No one WANTS to be vulnerable.  It becomes a lot easier when you know your friend or loved one accepts you unconditionally.  Which is fine when you’re admitting to a less-than-ideal habit . . . but I have seen that when it comes to money, sometimes unconditional love can become conditional.  And judgmental.  Which begins the slow death of the intimate relationship.

Perhaps your spouse has been laid off.  This sets off your own fears about money and having enough.  So you proceed to try and micromanage every aspect of your spouse’s search for future work—mistakenly thinking that the key to your security is your partner’s employment.  Not only is your spouse trying to figure things out, s/he has the added pressure of feeling like s/he is disappointing you by getting laid off.  Or because s/he senses your judgment, starts to feel like they are getting a handout from you, that they don’t deserve to have you provide for the family during their unemployment.  Shame ensues.  Intimacy dies.

Or maybe you have separate bank accounts.  There is a lot to be said in favor of having separate bank accounts, but I am not sure that those things have anything to do with a stronger, more intimate marriage.  When it comes to money, the most vulnerable position is to merge completely—if you’re in it forever, it doesn’t make sense to keep things separate.  If two companies merge, they “phase in” merging all of the different aspects of their different entities—but neither would be allowed to say, “I am going to merge our physical assets, but I am going to keep this cash account separate over here for my own use.”  So even without the issue of intimacy, holding back is counter-intuitive to a business merger.  In both cases, you either trust the other, or you don’t.  And if you don’t trust, then should you really be in an intimate relationship?

The idea of giving up control in an intimate relationship never starts with money alone, but it often becomes the primary battlefield, simply because it is the most tangible issue, with real-world repercussions.   If you fear vulnerability with money in your relationship, chances are you need to examine your comfort level in other areas of your relationship as well.  It’s never JUST about the money.

As a “recovering” emotionally unavailable person, I know all of the tricks to discourage vulnerability in an intimate relationship.  If you DON’T do the following, you will be well on your way to having a stronger relationship with your partner about money:

Don’t Listen.  I was so convinced that my way was the only way to do things, I would tune out the other person—essentially waiting for them to be done flapping their lips so I could Jedi-mind trick them into doing it my way.  Now I know that the only way to have an intimate relationship is to listen and try to empathize with everything, regardless of how I perceive it in the context of solving a problem.

Insist on Everything Your Way.  I come from a long line of people who think they are the only ones who know how to do things.  Yikes, talk about ego issues!  What I discovered during my masters program is that everyone in a team has a role, and that collaboration and handpicking solutions from a number of different concepts always works better than my original, solitary solution.  This is how to approach anything you want to stand the test of time.

Try To Fix Them.  I have witnessed a long-term relationship where the two people are always complaining about the exact same fault of the other person, all of the time.  It breaks my heart to see what they have missed out by not simply accepting the other person and working within each other’s perceived character flaws.

Try To Be Right All Of The Time.  The Tribe of Right All Of The Time insists on bringing up old arguments whenever they find a new piece of information supporting their previously not-as-supported stance on a topic.  So the argument never dies.  It never morphs into collaboration, because being right all of the time is the death of a stronger relationship.  Do you want to be right, or happy (and stronger as a couple)?  It’s another way that lack of forgiveness blocks you not only from your best relationship, but also the best version of yourself.

Remember When They Were Wrong.  When you’re in a relationship with someone who is Right All Of The Time, that means that you are Wrong All Of The Time and get blamed for it.  Or, if you’re right about something, they don’t talk to you for three days until they forget that you were right.  But there is a list—maybe just mental—of all of the times you were wrong, in case they need evidence to manipulate you into doing things their way: “See? You were wrong about X, why don’t we just do this my way for now.”

Emotionally Detach When Things Don’t Go Your Way.  When you absolutely can’t force someone to take your viewpoint or follow your lead, shut down completely.  Say, “It doesn’t matter what I say because you’re just going to do what you want anyway.”  And then wait for things to Go Wrong so you can add it to your list for the future.

Vulnerability and money is hugely intimidating for me in my endeavor to try and become more emotionally available.  I wonder if my willingness to be vulnerable with my money will be my greatest obstacle to a successful relationship, or if I am willing, my greatest opportunity.

For others, I believe that your openness to vulnerability can happen in stages—it doesn’t have to be all at once.  As long as you pay consistent attention to your finances in partnership with your spouse or significant other, you can’t get too off track.  Or if you do get off track or temporarily abandon your good intentions, you can support each other instead of blame each other.  But the key—as with many relationship issues–is to listen and communicate regularly.  And to decide together what is right long term for your own intimate relationship.

Now it’s your turn:  What’s your greatest money vulnerability or opportunity with your significant other?

Merging Money.  Should you merge everything you have and earn into one joint account, or should you maintain individual accounts and open a joint one for household expenses?   Couples run into trouble not necessarily when they are not in agreement—but when they start reading into what the lack of agreement means.  There as many different ways to merge your finances as there are couples in the world, so don’t get thing up on how you believe things should happen.  It took awhile to become a couple, and it will take a while to “couple” your cash as well.

Dealing With Debt.  One of the worst things about coupling is feeling like you’re dragging down the relationship with debt—which can feel even worse if your partner comes into the union debt-free.  Whenever debt enters the relationship, it’s good to remember that no one is infallible—the debt is not a way to keep a “scorecard” in the relationship.  People in mature relationships accept that solving the debt as a team not only strengthens the relationship, but helps reduce the debt more quickly.  Cutting up your credit cards may be too drastic for some, but that can help too!

Managing Spending.  In many relationships, one gets labeled the “saver” and the other gets labeled the “spender.”  Labels and categories can do real injustice to an in-depth, multi-layered relationship, and they never serve to make you feel closer to your partner.  And it may not even be true:  traditionally, women usually take care of most of the family’s daily expenses: the groceries, the bills, clothes for the family, while men spend on large purchases like plasma TVs, cars or computers.  The spending amounts to roughly the same, it just played out differently based on the person.  They key here is to remember that you’re simply trying to avoid surprises, which a budget goes a long way toward fixing.

Investing Wisely.  Over many years, various studies show that men are more willing to take financial risk than women.  However, investments are a secondary argument.  The biggest issue is achieving agreement and understanding of how specific buckets of money will be used in varying timeframe—or how I like to ask, “which money will be used for what–?”  Once a discussion of goals and timeframes are clarified for different accounts and sums of money, it becomes much easier for couples to align themselves with common goals and objectives.

Keeping Money Secrets.  Let’s face it; most of us have trouble not lying to ourselves, let alone other people.  Lies about what we ate, what we spent . . . this is one of the fundamental challenges of a relationship, to be vulnerable and transparent in all areas  (and not letting your own shame and money secrets degrade to such a point they damage you and the people around you!).  If you knew that lying about how many books you downloaded on Kindle, even once, would lead to a less authentic, open relationship with your spouse, would you do it?  Probably not.   Each partner must keep in mind that most relationships aren’t destroyed by one dramatic act, but a series of small, even individually inconsequential acts that chip away at your foundation of love and trust.

Emergency Planning.  Just like couples vary on the degree of risk they are willing to take, they also vary on the level of reserves they need to feel safe.   They key here is to find the commonality; both partners typically agree that some level of cash reserves makes sense, so where is the middle ground?  Once a budget is clarified, issues of emergency savings become secondary, since some level of savings has already been allocated within the spending plan.  It helps to remember if there actually is an emergency, you’ll be distracted with supporting one another—and NOT worrying about how to spend the reserve!

Sometimes it’s hard to forgive money mistakes—yours, your partners—so the key is to get ahead of them before they happen!  With honesty, open communication and a willingness to look at your finances objectively, couples can avoid becoming victim to the top money arguments, and move forward as a cohesive team.

Love is a choice and an intention–not only an emotion, but also a behavior.  When we choose to love our cat even though she scratched us, that’s love.  Or when we choose to help our child solve a problem with all of our patience, resources and energy—even though we might be running low on all of those qualities—that’s love too.

We know we’ve invested our love in the right way when our relationships continue to improve.  And, our relationships with money will continue to improve too, as long as we honor it in the same 15 ways that we honor the other important relationships in our lives:

Pay Attention To It.  When your loved one comes into the room, you acknowledge him or her.  Even if you don’t have time or your hands our full, you still pay attention.  You would never roll your eyes and tell them, “I’ll deal with you later!”

Make Time For It.  Date night for couples is every bit as important as setting a date to make time for money in your life.  You respect what you inspect.  This is how you improve your competency.

Prioritize It.  As we get older and our lives get fuller, we must choose how we spend our time.  Whether this is conscious or unconscious, our priorities create our value system.  If you want to place more value on money in your life, you have to make a conscious choice to prioritize it.

Celebrate The Good.  When a kid achieves something, you put the medal, certificate or piece of art on the fridge.  When you feel like you’ve made some progress with your money relationship, you must allow yourself the same moment of recognition.  You’d never tell your kid, “Well, I guess that’s okay, but I expect a lot more from you in the future!”

Forgive The Bad.  When a loved one makes a mistake, you don’t flip out on them (I hope you don’t!); you acknowledge they did their best, forgive them and move on.  When money doesn’t come soon enough, or you find yourself earning less than you hoped for, you need to remember that this is one blip in a relationship that lasts a lifetime . . . and move on.

Keep A Sense of Humor.  Have you noticed that it’s more fun to be with someone when they are willing to laugh at themselves?  Those characteristics of self awareness and the willingness to not take themselves so seriously is a killer combination for successful relationships.  Money doesn’t have to be super serious; in fact, it’s better when it’s not.

Respect It.  With loved ones, you don’t simply take their voice or presence for granted—or if you do, you’re not going to get the kind of relationship you want.  You money is always trying to tell you something, so you need to pay attention and look for the clues. 

Don’t Manipulate It or Try Power Plays.   With people and things you really love, you don’t really think about the balance of power.  And if you love someone, you’d never want them to do something just because you manipulated them into doing it (unless you’re money codependent).  If you’re hoping to get money from someone who you perceive to be in a power struggle with you, it will come very slowly.  Eliminate the ideas of power from your thoughts about money and it will flow much more easily.

Don’t Blame It For Your Bad Mood.  Money is never the reason you’re in a bad mood; it’s your perception of the situation that causes you fear and pain.  When you think you’re mad at money, you need to pull back the lens and try to understand how your thinking got you to this place.  You can’t heal your emotional life with intellectual thought, but you can start to understand your triggers.

No Quid Pro Quo.  Quid Pro Quo means a more-or-less equal exchange or substitution of goods or services—you scratch my back, I’ll scratch yours.  Can you imagine setting up this kind of arrangement with a loved one?  With a monetary situation, this kind of dynamic is bound to make you feel like you got the short end of the deal, regardless of the arrangement.

Seek To Understand.  When something happens in your family or friendships that you weren’t expecting, you find out all of the details before moving forward.  When something happens with your money, you need to devote the same attention to understanding the dynamic before jumping to the wrong conclusion.  You may find your knee-jerk initial response to the situation is wrong, once you review the facts calmly.

Don’t Lose Yourself.  This is a tip from conscious spending; you need to know exactly how you feel about all of the different ways your money leaves your accounts.  If you’re not happy about any one of them, you need to stop.  If you’re unconscious about your money, then your relationship is on the decline.  Another name for this is money fog.

Recognize Difference Between Want and Need.   You WANT your child to be an NBA superstar, but you need him to be kind, thoughtful and compassionate person.  If this is a romantic relationship, one is a deal breaker and one isn’t.  With your money, you WANT to go on an African safari, but you need to meet all of your expenses.  There is room for Wants, but they need to be in alignment with your current life and not just driven from your ego.

Seek Clarity.  If you’re not clear about what is happening in a relationship with someone or something else, chances are they don’t know either.  You always have the choice to let a situation remain ambiguous or to choose clarity.  The results of clarity may not be pretty (and you may have to move past some shame-filled thoughts), but it’s far better to be clear about the ugly truth than to be uncertain about an attractive ambiguity.

Have Faith In Long Term Vision.  Relationships are seasonal; sometimes they are exciting, and other times they just quietly exist in the background.  Nothing is static.  The same is true of your relationship with money—it can’t be all rainbows and parades.  That’s when you must make the choice to love it anyway.

Bottom line, if you haven’t made a choice about how you feel about your financial life, it’s the same as when you put off making a decision about whether or not your current beau should stay or go.  You think you’re on the fence because of something external, when in reality, it’s you, refusing to accumulate the data needed so that you can make an informed choice.  Change can be painful—but on the other side of the pain is a money relationship full of love and freedom; it’s only waiting for you to decide.

Load Structure.  When mutual funds first became popular in the 1980s, you had to go through a broker to purchase them.  You paid the broker through a front or rear load on the mutual fund so that s/he would service the account and help you from time to time.  Although there are many great fund families where you still pay a load, as well as many great brokers and planners whom you compensate by investing with them in a loaded fund, the do-it-yourselfers of the world don’t need to mess with loaded funds because there are plenty of no-load options that still provide great long-term performance.  Therefore you need to verify exactly what you are paying, and decide what your “load philosophy” is going forward. 

An easy way to do this is to simply look up your mutual fund using its’ ticker symbol at a site like Morningstar—in this example, I looked up AGTHX, American Growth Fund of America so you can see where to tell if the fund is loaded (you’ll see in the photo that it has a 5.75% front load—meaning of every $100 you invest, $5.75 goes to paying the person who sold you the fund).

Internal Fund Expenses.  In addition to the load you might be paying, you’re also paying internal expenses that go toward the operation and management of the specific mutual fund.  Without going into all of the different types of mutual funds, the general principle is that you tend to pay more for an active portfolio manager monitoring a mutual fund, and you tend to pay less for a fund with a passive investing strategy, such as an index fund.  One type isn’t necessarily better than the other, but again, I believe that a general guideline for what you’re willing to pay is reasonable—for example, most of my clients tend to stay at 1% or below.  You can check and see how much your mutual fund is charging you, typically under the heading of “Expenses” on the fund fact sheet.

Asset Class.  Asset class simply refers to what “flavor” of mutual fund you’re purchasing, and all of them are initially categorized by the size of the company and phase of growth.  Ideally, small, medium and large companies would move differently—if one class is up, another would be down, and so on.  We can’t control that, but diversification is still important, which is why I encourage people to make sure they spread out their investments over multiple asset classes, which they can check for by looking at the individual fund’s style box.

One mistake I see often is that someone has invested in multiple mutual funds—perhaps in their 401(k)—but the underlying holdings are identical.  Every fund will tell you what their Top Holdings are, so you need to compare and make sure your funds aren’t in 3 different funds with identical holdings!  You’ll see below I compared two American Funds, and both of them have Apple and tobacco companies, so they may not be the best funds to hold together if you’re looking for diversification.

Benchmark.  The final checkpoint for evaluating your mutual fund is to compare it to other similar entities—every single asset class has a corresponding index, which you can use to see how the overall asset class is performing, and then see how your individual mutual fund is holding up against that benchmark.  Often when you pull up your mutual fund’s information, a benchmark is already provided for comparison.  The question they are answering with the below chart is, if you invested $10,000, how has the benchmark and your mutual fund performed over the same timeframe?

As you can see, this specific mutual fund (blue) did better than its benchmark (orange) during the 10-year timeframe.  Although, if it even simply held even with the benchmark, I would still be satisfied . . . it’s only when you can see consistent performance below the benchmark that you need to look at making a change.

When it comes to mutual fund investing and evaluating performance, the multitude of criteria can become very confusing very quickly–and there is A LOT here that I haven’t mentioned that sophisticated investors may factor into their evaluation process.  However, many people lose sight of what they are trying to accomplish when confronted with too much data and become paralyzed!  With these four simple guidelines, you can get started on the road to understanding your mutual fund investments more easily, while maintaining your forward long-term investing momentum.

Blaming someone else (or blaming yourself) about any frustrations over money has to do with the basic thought that your survival is being compromised.   The perception is that this other person has the power to make or break your financial life, depending on what they do.  It’s very difficult to like, much less love, someone on whom you believe that your survival depends.  So when you are engaged in the blame game, you may forget that you are every bit as responsible for the relationship dynamic as the other person.

If you often feel like someone has more control over your money than you do, then you’re probably engaging in one or more of the archetypes of survival.  These don’t deal exclusively with money, but since money is a survival issue for many of us, we find ourselves acting in ways that make us feel LESS empowered about money—usually at the moment when we most need to feel secure.  Here are the 5 archetypes that are most common with money and survival issues.

Victim.  The Victim feels helpless to get his needs met and believes s/he has to struggle for everything.  Patterns include focusing on the “lack” or absence of what they want and avoiding doing things that are new, different or perceived as risky.  To move out of a victim mentality, you must start owning your role and acknowledging how you have been an equal partner in creating the situation, with the power to affect alternate outcomes. 

Martyr.  The Martyr gives too much out of a desire to receive love, attention and approval from others.  They might appear to be selfless, but what is given comes from a self-righteous place—if they don’t get back what they hoped to receive by giving, they become resentful.   Martyrs often believe deep down that they are not worthy of having what they want.  The solution for Martyrs is to start giving to themselves first.  This isn’t selfish, any more than it’s selfish to affix your oxygen mask before helping others in the airplane scenario.  Once Martyrs start putting themselves first, they start to believe in their own deserving and worthiness to receive.

Servant-Child.  The Servant-Child abdicates power, responsibility and control to others.   They don’t want the burden of deciding what to do for themselves because it paralyzes them.  Since the servant gives up control and power when trying get what they want, they often become inflexible, manipulative or “attached” to the outcome.  Servant-Children should trust themselves to take on more responsibility to prove that they can handle it.  Once they build confidence that they can deal with situations on their own, they feel less and less like they have to manipulate everything in their environment, and own their power outright.

Prostitute.  The Prostitute is willing to barter self and integrity in return for external trappings, material possessions and security.  They believe that they have to pretend to be someone they are not or that they will be judged.  They are overly sensitive to what other people think, and often search for “proof” of the love and approval in their lives.  To heal, Prostitutes must prioritize their inner world over their outer world until they get a better sense of who they are, what they care about and how they want to “be” in the world.  Prostitutes’ primary journey is one of self love and self forgiveness, so that they can eventually understand that they are “good enough” to get everything they need on their own, without compromise.

Saboteur.  The Saboteur repeats self- defeating patterns in order to stay safe within their comfort zones.  Saboteurs’ low self-esteem causes them to make choices that block empowerment and success—they think that they can’t have, or don’t deserve to have everything they want.  They may even be sabotaging themselves so that they don’t appear as successful as a mate or someone else close to them.  Saboteurs may engage in other archetypal behaviors to assist them in their self sabotage.  Saboteurs must keep in mind the famous Marianne Williamson quote (abridged): 

“Our deepest fear is not that we are inadequate. Our deepest fear is that we are powerful beyond measure. It is our light, not our darkness that most frightens us. Your playing small does not serve the world. There is nothing enlightened about shrinking so that other people won’t feel insecure around you. “

Blaming someone else provides a focal point for your frustration, but it doesn’t solve the core issue of giving you more control over your money.  You may not even be aware that you have been playing the blame game, but you may be wondering why you are not as successful with your money as you want to be. 

Even if you don’t think these archetypes apply to you, think about how you interact with the people in your lives, both in the past and present. Sometimes it helps to pretend you’re complaining to them, or yelling at them . . . in that situation, what would you say that you’re not saying to them directly?  With regard to this person or entity (like an employer), ask yourself these 5 questions:

1. Do I feel helpless? Do I feel that I have little or no control over the situation or events?
2. Is there an imbalance of energy? Do I feel that I may be giving more than I am receiving?
3. Am I waiting for someone else to handle this? Do I feel that there is someone else who has the power?
4. Have I been willing to make a trade? Have I been willing to give up something important so that I can to get something else that I think I need?
5. Is this a repeating pattern? Have I experienced this (or something very similar to this) before?

After you gain clarity around what archetypes you’re engaging in (and honestly, it could be ALL of them playing out in different areas of your life), it’s difficult to continue the dynamic.  Not because there is any need to end the relationship; that person will respond to you differently when you start to think differently about yourself.  Even without taking specific action, your new-found self awareness will help you change to healthier relationship interactions.   And the result from that will be a healthier, more powerful, conscious and peaceful relationship with your money.

For employed people, I advocate the Zero-Based Personal Budget method, which means money in equals money out, every month.  Since you can reasonably predict what you’ll be receiving, there are rarely surprises with this method.

For self-employed business owners, like myself, I try to apply the Zero-Base Personal Budget using an average income from the prior 6 months; if income goes down, you have to adjust your personal budget down as well.  If income goes up, you hold the excess until you have another 6 months of evidence that your income has stabilized upwards.  It can get more complicated, but you get the gist.

Some of you know that I use Mint to track if I am going over in one of the areas of my personal budget.  I have alerts for my overspending “danger zones” which are eating out, coffee, coffee and coffee.  I think I have finally conquered books as an overspending item!  But because some months I have extra cash above my personal budget, I know that I have a little breathing room if I want to spend extra on something.

So, this last month I did.   I had WAY too many meals out, in addition to special holiday grocery purchases.  And somehow, I was so hypnotized by Starbucks pretty red holiday cups that I had a Peppermint Mocha in my hand more times than not. 

And, you know what?  I didn’t care.  I am now aware enough of my spending that I CONSCIOUSLY went over budget—plus, the Mint alerts kept reminding me!  I didn’t care because I have come so far from that crazy, clueless financial planner of my twenties that for her, my spending wouldn’t even register.  Yes, my overspending may have prevented several hundred dollars from making it to my cash reserve this month, but there will always be setbacks.  As J.D. Roth of Get Rich Slowly says, “Perfect is the enemy of good.”   I know exactly what I need to do to get back on track.

Sometimes people let the personal budget abandonment go on for more than a month.  Maybe they aren’t as conscious, or maybe they hate the tracking system they have set up (for budgeting software options, you can find alternatives to Mint here).   Whatever the reason, recovering your personal budget and recommitting to following it is an easy first step for the new year.

Think of it like getting back on track with your health after a month or more of overindulgence.  If you can commit to this next month of performing some basic routines and engaging in healthier behavior, you’ll not only set yourself up for a healthy 2012, you’ll replace the regret of the past month of overeating with pride over your new accomplishment.

Here are 6 steps to get your personal budget back on track:

Confirm average income.  The quickest way for people to become ineffective with their personal budgets (as I can well attest) is letting raises and excess cash merge and mingle with existing fundswithout accounting for them.  Know exactly what is coming into your household from month to month.

Confirm your expenses.  Knowing the amount of your fixed expenses is easy; it’s the lifestyle expenses that tend to creep up without you noticing.  If you’re using budgeting software, go back and get an average of the past 6 months for different categories.  If you’re NOT using budgeting software, this is a perfect time to start.  But you might want to review bank statements and credit card statements to get an average to start with—the good news about budgeting software is that you’ll never be in this situation again!

Identify the excess income.  Hopefully, you have found that Income – Expenses = Excess Cash.  At some level.  Then you get to decide where the excess cash should be allocated—toward cash reserves, goals, etc.  This will be the new normal for you, so you can have it auto-pull out of your account every month or every paycheck.  If there is NO excess income, or you’re at a deficit, there are really only two solutions to correct this: Spend Less or Earn More.   I really encourage people to understand and tweak the expense side of things first, because clearing up the ambiguity with spending often frees people emotionally to have the energy to earn more.

Create your new “normal.”  You’ll find that you’ll alter your behavior to spend less, and I can tell you, the next month for me is all about meal planning for efficient grocery shopping.  Inviting friends to my home to eat together more cost effectively.  Those steps, and going back to my regular drip coffee (which I am actually glad to get back to!).   In your budgeting software system, set up alerts to notify you when you go over budget in a category.

Review weekly.  As you get into this new personal budget implementation, I recommend you review your budgeting software weekly, so you remain on top of all of your spending.  Eventually, you’ll be able to look at it less frequently, but for now, you respect what you inspect.  Reviewing often will reinforce new behaviors.

Find a buddy.  Find someone you trust to review your spending and give you a reality check.  This buddy can also make a spending pact with you, so you’re both cutting back on certain expenses and together finding new interests to fill that gap in your life.  Just like having a workout partner, having a “budget buddy” will make the personal budget easier to follow.

There are many parallels between reaching your financial goals and reaching your health and fitness goals.  Both are a marathon, versus a sprint.  You’ll never be able to stay 100% on track.  However, if you are able to remain consistent, forgive yourself for mistakes and take a long term view, you’ll be surprised at the improvements you’ll make over the next year!

When it comes to tracking your spending, my goal is that everyone does it, regardless of their financial situation.  You can’t make conscious decisions without that data.  My personal favorite budgeting software option is Mint.  I recommend it to everyone I work with, because it fit my personal criteria:

• Simple to use.  From the moment I started setting up Mint, I could intuitively click and get to where I needed to go.  I never was stuck trying to understand what report I needed to run, like some other programs I have used in the past.
• Minimal set up time.  Setting up my bank accounts in Mint the first time took all of 30 minutes.  I have a different way of doing things than a lot of people when it comes to budgeting, so it might take some as much as an hour.  Still would be a record for me at an hour!
• Minimal maintenance.  I can stay up-to-date with Mint using their iPhone app, but mostly I just check in every 10 days or so to monitor trends and check categorization.
• Free to use.  Mint has affiliate partners making offers—which is what keeps it free—but it’s easy to ignore them and focus on your finances.  I have never been irritated or distracted by an offer.

I don’t use Mint to track investments or set goals, but it has that functionality.  Mint has worked so well that I have maintained it for almost 5 years now, which is a record for me!   That may be because it’s an online program, and there is never anything to update . . . plus, there was zero upfront commitment to purchase, unlike desktop versions of software.

Having said that, I also understand that people operate in different ways, and Mint might not please everyone.  Therefore, I have compiled a list of 11 other budgeting software programs that might suit you, although I have not personally tried them.  But if someone finds it easier to execute their tracking on one of these programs, they are that much closer to engaging in conscious spending.

Here are 11 personal finance programs if you don’t care for Mint:

Desktop Versions

1. AceMoney is a desktop app that offers all the features you’d expect: downloadable transactions, budgeting, investment tracking, and more. AceMoney costs $40, but a free “lite” version is available.  With my initial inspection, there just wasn’t enough going on to engage me visually.  iPhone app available.
2. Quicken is perhaps the most popular personal-finance software available today. It’s fairly comprehensive and well-supported, but not without problems. Old versions are “sunset-ed” at regular intervals, forcing users to upgrade if they want to continue using certain features.  Desktop software costs $60.
3. Moneydance. The Washington Post said Moneydance manages to replicate much of Quicken’s functionality — but in some cases a bit more elegantly.  It’s available for Mac, Windows, and Linux. If you’d just like to try out Moneydance, you can download it for free–the only limitation is a maximum of 100 manually entered transactions.  Full-use license costs $50. iPhone and iPad apps available.
4. YNAB stands for You Need A Budget (YNAB) and it’s fairly impressive with its free, live classes, but it does NOT import your transactions, because they believe it kills awareness. Even though that would be a deal breaker for me, I agree with their budget methodology.  Desktop for Mac or PC is $60. iPhone app available.

Online Versions

1. Budgetpulse is a free online program that offers standard budgeting and tracking features. One of this program’s stated goals is simplicity; it doesn’t try to do a whole lot other than track your core accounts.
2. Buxfer started as an online tool for tracking debts and has grown into a more comprehensive financial management tool.  It goes from a free, basic membership to a $5 premium membership.  iPhone app available.
3. ClearCheckbook has a free online program as well as a paid, premium program.  Many old users of Microsoft Money moved to this program for its simple yet robust reporting tools.  iPhone app available.
4. Moneystrands.  Based in part on a financial management tool from Spain, moneystrands offers all of the features you’d expect. One issue that made me nervous was the mention that they are reconfiguring account aggregation so you may have to manually upload data for some accounts—that would be the death of my tracking!  iPhone app available.
5. Mvelopes is a web-based version of the envelope budgeting system that’s been around for over ten years. Though I can’t refute ten years of success, I DID go a little crazy trying to figure out potential usage costs by looking at the site (they imply there are transactions costs).  iPhone app available.
6. Pocketsmith.  Pocketsmith is a web-based program that you pay for on a monthly basis ($10), although a free version is available as well.  The program takes a unique approach to the budgeting interface by utilizing a calendar to forecast your future cash position.
7. Yodlee is the granddaddy of free online money-management software. It’s the platform on which many account aggregation tools are based. But Yodlee also offers its own personal-finance product called MoneyCenter. As you’d expect, it provides the same account-tracking functionality that most of these applications have, but it doesn’t feature budgeting as prominently.  iPhone and iPad apps available.

There may be others out there that I missed–if you have one you like, I’d love to hear about it and why you like it!

Bottom line, the programs offer very similar features, so you need to decide what speaks to you personally and your method of staying financially organized.   The best way to get started is to choose one and jump in—if you decide you hate it, jump in and choose another.  Some people might start with ALL of them, and then only maintain the easiest; each person needs to decide what will work for them.  The key is to get started and make this the year that you finally get precise and clear about your spending!

This doesn’t have to be a laborious process; just becoming more aware should give you a lot of data in a few weeks.  To begin, you should start using Mint (the best comprehensive tracking software I have used).  Mint gives you a great overview and long-term tool.  Along with Mint, I recommend taking a week or two to keep a journal with your daily spending, so you understand on-the-spot how you’re feeling before and after each purchase.

I have identified four types of spending that cover virtually every single dollar that leaves your bank account:

Avoidance Spending.  You’re spending money on something to avoid worry, fear, pain or doubt.  This might be your belief that you need to spend thousands of dollars on programs with experts to help your business grow; or that you can’t start working out until you buy an elliptical machine. 

The truth is, it never works that way.  Whenever you start to see one thing or person as the end-all solution to your problems, you need to go deeper and examine what you hope this expense will “fix” in your life.  Once you acknowledge the thought, it often becomes less urgent.

Automatic Spending. This includes most of your spending month in and month out; stuff like rent or mortgage, gas, groceries, etc.  Where people get into trouble is over-buying things that they know they can afford, such as take-out food, books or coffee (read my previous posts if you aren’t yet familiar with my addictions). 

The goal here isn’t to completely eliminate spending, but to simply be as conscious about it as possible, and to get the best use out of every dollar you spend.  This means you have to be aware of exactly how much you spend.  Once you’re aware, you can set up a Mint alert to let you know when you’re spending more than you’d like in a particular area.

Impulse Spending.  You spend money on something that wasn’t a priority until you were in the store (or online), standing in front of it.  There was a time that I couldn’t go into a store like Target or Costco without suddenly realizing that I needed ALL OF THIS STUFF around me. 

What I noticed was the less I went into stores, the less I spent.  Then, when I was going through a particularly lean time, I learned that if I just stuck to the list, I was fine.  Some people just bring the cash they plan on spending.  The point is, you never need to impulse buy.  If you really decide you want it, you can go back for it after thinking it through. 

Occasional Spending.  I am not even sure if this is the best term for this sort of spending; this is spending that falls outside the normal budget, usually for something special that you don’t buy all of the time, like (for me) clothes or furniture.  Some people have a problem because they hesitate, or never get around to buying the thing, while others have issues because they spend too much.

The reason for why some people put off buying or that some people overspend is that they have placed too much emotional importance in the object. Or, it may be that they haven’t clarified for themselves exactly what will make them happy.  I have been at both ends of the scale; when I was less aware of my cash flow, I used to spend hundreds (if not thousands) on home décor because I was trying to achieve a certain feeling in my home, and always thinking the NEXT thing would make it perfect.  Now, after having my own lean times and currently VERY aware of my spending, I actually hesitate from buying a lot of things, because I know the item itself won’t give me any lasting feeling.  I tend to take a VERY long time to invest in new furniture, because I want to make sure it’s not just a passing fancy.  I also haven’t bought new glasses in a very long time because I place so much (too much) importance in how they will make me feel; I can’t believe any one pair is going to look so great on me that it’ll be worth having them, yet I cringe in embarrassment at the thought of having to wear my old glasses out in the real world if I should have some sort of contact lens emergency.  So crazy cuts both ways!

All of these spending categories and their distinctions could fall under the traditional term of “impulse spending,” yet you need to find the impetus behind the impulse; otherwise, you’ll never understand the core story you’re holding onto with say, eating out in restaurants versus paying for a personal trainer.

I believe that all expenses can be valid, and everyone deserves to spend money on things that make them happy.  The key is, once you start paying attention to the type of spending you’re engaging in, you will not only start spending more strategically–and in alignment with a budget that reflects your goals–you become happier in the process.

Spousonomics shows that this just isn’t true!  The book, by Paula Szuchman and Jenny Anderson, offers a hilarious and valid twist to standard marriage advice by showing how economics—yes, economics—is the key to a happy marriage.  What it also showed me is that married people aren’t 100% honest with each other, especially not about money.

In what the call their Exhaustive, Groundbreaking and Very Expensive Marriage Survey, Szuchman and Anderson discovered that based on economics, there are actually incentives for spouses to lie to one other.  One such principle is Asymmetrical Information.  This means that if you’re totally honest about a topic you might be penalized, so consequently, you withhold information when communicating.  For example, you might fudge on the amount of time it takes you to complete a task you were asked to perform by your spouse because you want to build in enough time to goof off before you actually do it.  So you lie about it instead of being nagged by your spouse or assigned additional tasks.  By withholding information, you get what you want from the spousal transaction.

This also starts to get into another principle: Moral Hazard, the idea that if there are no perceived consequences to an action, we slack off.  We all need “skin in the game” to perform at our best.  For example, if we didn’t have deductibles and coinsurance amounts associated with our homeowner’s insurance, we might leave lit cigarettes hanging around, because the total cost of home replacement would be on the insurance company.  The insurance company knows this, so they created a way to ensure a consistent level of responsibility and participation.

In their survey, Szuchman and Anderson found that communication changed over the years; 42% of respondents regretted being too honest more than not being honest enough (35% regretted not being more honest).  The reasons 42% withheld important info:

• 89% – so as to not upset their spouses
• 72% – to avoid a disproportionate reaction
• 67% – to avoid a lengthy discussion
• 48% – to avoid embarrassment
• 43% – to avoid having to compromise

Spousonomics isn’t focusing specifically on money conversations, but I can’t help thinking that if the survey DID focus solely on money and marriages, the results might be even more disturbing.  Does this mean that total money transparency is unrealistic?  Maybe it is.

When I talk to couples about money, I believe that each individual needs to control a certain level of discretionary spending.  Simplistically, this means that each spouse somehow has their own stash of money that they are allowed to spend however they please.  How this gets divided and decided is too much for this post; but the result is that if Eve wants to spend $40 on a manicure, Adam doesn’t have a whole lot to say about it.  And honestly, may never even notice.

The problem comes up when one spouse wants to exceed an agreed-upon spending level, or if spending is pooled, starts to spend more than the agreed-upon amount.  For example, if Adam usually takes $40 out per week for work-day lunches, but starts to take out $80 weekly, this is a moral hazard.  Eve can’t actually stop him from doing this without some agreed upon consequences.

Spouses need to maintain the mindset that they are on the same team; otherwise consequences just turn into angry retaliations and war tactics.  But if they can maintain the “we’re-all-in-this-together” attitude, couples can take five steps to navigate the hazards they encounter:

1. Identify incentives to behave.  If one spouse doesn’t hold up their end of the bargain, then the consequence is that the other spouse doesn’t have to do something either.  In Spousonomics, regular sex was a powerful incentive for men to behave in many examples.  Another incentive might be if Eve spends too much at Amazon, Adam gets to eliminate their eating out budget for a month, but redirect the balance of it for his personal spending.
2. Set limits.   If spending in any area is perceived to be a problem by either spouse, then both spouses have to talk about it.  If one spouse is spending money on something without regard to what the other spouse is spending, then there needs to be a conversation about that item’s perceived value, and agreement about how to limit, balance or offset that expense somewhere else in the overall spending.
3. Identify perceived values.   For Adam, lunch out every day with colleagues might be his most valued discretionary expense.  For Eve, Pilates sessions might be the most important.  This means that even if the monetary values are different, the intrinsic value is the same.  Understanding how your spouse perceives the importance of spending in different areas will also help you negotiate with each other how to best use every dollar that is spent.
4. Forgive mistakes and don’t hold grudges.  A cooperative bargain identifies in advance the incentives associated with certain expenses and situations, but what if someone just goes completely nuts, spending on something not covered by prior conversations?  Unfortunately, their anticipation of their spouse’s yelling, nit-picking, grudge-holding or silent treatment won’t incent them to come clean about their mistake.  Therefore, there has to be an agreement that honesty is only awarded by calm, open conversation.  The other spouse might have to take some time alone to work through the issue prior to having this discussion, or speak to someone (who can be productive, not negative) to help them sort it through.
5. Negotiate quarterly.  Even if the spending bargains are working perfectly, couples still need to review them 3-4 times per year to make sure that relative values for certain items have not changed.  For example, if Eve becomes pregnant, Pilates might cease to be an incentive for her.  If she’s overspending on baby stuff and Adam and she have never talked about values and consequences, Adam is going to be frustrated because there is no incentive to help her focus.

It would be great if we were all mature enough to not need a system of checks and balances to negotiate our money relationships with our loved ones, but economic theory says we’re not.  Spousonomics gave me an understanding of how to negotiate conflict in relationships and apply it to money conversations, and I highly recommend it to anyone who wants to improve their conflict resolution, married or single.

OWS doesn’t have an official website, just an unofficial de facto online resource (as it calls itself).  It describes itself as leaderless resistance movement. Occupy Wall Street states it is composed of the We Are The 99%, and that they will no longer tolerate the greed and corruption of the 1%.  On its website, it states they are using the revolutionary Arab Spring tactics and encourage the use of nonviolence to maximize the safety of all participants (Hmmm . . . ).

It’s exciting to see Occupy Wall Street all over the country deliver a message that transcends government and party politics.  I am interested to see how OWS takes part in the conversation of change.  Yet I can’t help but wonder if the language that is being used in OWS isn’t what got us into this mess in the first place. 

There is no place to go and see the accomplishments of OWS to date, which makes it similar to our experience with war in Iraq; is anything really getting done, or are we being swept away by propaganda?  There is a lot of talk, but what kind of results or payoff can we identify? Is our most effective target for occupation really Wall Street, or is something else?  

OWS primarily makes me concerned with people getting arrested and injured unnecessarily for civil disobedience (or just assembling), but it also makes me sorry for the police, who may feel like the 99% but can’t act in any significant way.   Or who are forced to make decisions so quickly in the heat of the moment that often, they are the wrong decisions.  Why does trying to understand the effects of a leaderless revolution feel so much like trying to understand the results of the Iraq War?

War and its language have a way of polarizing positions much more immediately than conflicts that don’t use the language of war.  I do, however, agree that our last war did an amazing job of humanizing our troops and keeping them out of the argument of right and wrong.  I was amazed during the Iraq War how Support Our Troops (no matter what happens) gave us compassion for the men and women fighting there—if not for the actual fight itself.  What would happen if compassion was integral to the conversation, instead of simply dispensed from the sidelines?

The language of war is more the world of men than women, as is Wall Street.  Rules, structure, boundaries and achievement dominate over compassion, humanity and the group dynamic.  Ask yourself why we have a financial services industry in the first place:  because we’re afraid we’ll screw it up on our own.  FEAR.  Wall Street controls us by making us afraid.  So does the IRS.  Does OWS?  OWS may well be polarizing people to believe that either you revolt or you don’t get your needs met.  Fight or flight.  And it’s impossible to enter an intelligent discussion and be truly empowered if you’re in fight or flight mode.

When we think of power and money, we think of gaining control and influence over someone or something outside of ourselves.  That’s also describing the male archetype of being an alpha male.  When we think of empowerment, the desire tends to be a softer, more feminine-based internal mastery of oneself that makes us more effective with working with the external world.  Which of these concepts is more conducive to helping the 99%?  In helping ourselves?

The world of men is about competition and risk-taking, but it may be less rational.  A recent British study used the saliva of male traders to track natural variations of testosterone and the level of profits they earned for the firm on a daily basis.

“We found that a trader’s morning testosterone level predicts his day’s profitability,” reported the study, published last year in The Proceedings of the National Academy of Sciences. Higher testosterone meant more risk-taking and, usually, more money.

Men have an advantage over women on the trading floor, but the study also suggested that elevated testosterone levels “may shift risk preferences and even affect a trader’s ability to engage in rational choice.” In other words: when male traders crash . . . they crash hard.  When police try to control an unruly crowd, they pepper-spray people indiscriminately.

Bringing more feminine qualities to OWS (and Wall Street) could prevent the me-versus-you mentality and maintain a more even, rational approach.  After all, when we gave women the ability to vote, we also saw some unexpected gains.

Skeptics note that the first president elected after women got the national vote was Warren Harding — an embarrassment to female voters ever since. Yet a study published recently in The Quarterly Journal of Economics by Grant Miller of Stanford University indicates that female voters did have a profound and positive impact.

Where women won the vote before national enfranchisement, politicians there quickly began behaving differently — in particular, devoting about 35% more money to new public health programs. These programs were seen as a priority for women, and the politicians wanted to curry favor with them.

The same happened at the national level:  the 19th Amendment of 1920 was followed a year later by the Sheppard-Towner Act, a landmark public health measure, because members of Congress believed that was what women wanted.  The upshot of all this was a sharp decline in child mortality, with the study attributing 20,000 fewer deaths nationally each year to the impact of women’s suffrage.

There are great male qualities that can integrate with the feminine sensibilities to achieve a more financially balanced ecosystem and government.  But all of the choices start with how the individual perceives his or her own situation.  Are you at war with your finances?  What does all of this mean for your choices of power and empowerment around your own, personal stash of money?  Who are you resisting or revolting against in your financial life? 

Albert Einstein gave us perspective on so many issues, not least of all the issue of peace.  He said, “Peace cannot be kept by force. It can only be achieved by understanding.”

Therefore, for peace of mind over our money, economy and our political choices, we need to first have peace over ourselves and our own situation.  And that won’t come from revolution, resistance and protest; it can only come from compassion, balance and humanity.

What about you?  How have you achieved more peace, balance and empowerment in your finances?