We spend decades saving, investing, and building a nest egg, and then we get to the point where we’re supposed to enjoy it, and we can’t. Sound familiar?
Jesse Mecham, founder of the beloved budgeting app YNAB (You Need A Budget) and author of the new book Never Worry About Money Again, joined Jean Chatzky on the HerMoney podcast to talk about why having money in the bank isn’t always enough to quell the money anxiety and what it actually takes to stop worrying about it.
The Worry Isn’t Really About the Money In The Bank
A recent Allianz survey found that 67% of Americans worry more about running out of money than they worry about death. Mecham isn’t surprised, but he does think most people are misreading what’s actually going on.
“Money can’t buy happiness, but it can steal it,” he said. He’s seen it over and over: people in their 40s earning more than their 27-year-old selves could have imagined, and who are still just as anxious.
“We are carrying around this worry that is just flat out unnecessary. We don’t need to earn more. We don’t need to spend less,” he said. “The issue is that we spend so much time acquiring money that when the spending starts, it feels like losing control.”
This is what Mecham calls RAMS: Random Attacks of Money Stress. The name came from a YNAB user who wrote in about the experience, and Mecham found it immediately recognizable. It’s the little ping of doubt at the grocery store. The mental math at dinner. The hesitation before booking a trip you can absolutely afford. The size of the purchase often has nothing to do with it.
“It’s just this little devil on your shoulder casting some doubt, casting some concern,” Mecham said.
The Hardest Part: Spending What You’ve Saved
Behavioral finance has done a remarkable job of bubble-wrapping the saving and investing process; automating contributions, removing friction, making it easy to do the right thing. But no one has done that for spending. There’s no equivalent system for figuring out how to actually spend the money you’ve built up in the bank.
Mecham’s advice is to start with what’s real and what’s in front of you. “We always start with the money you have on hand. Never with what money you will earn later,” he said.
From there, the work is simply asking — category by category, dollar by dollar — what it is for. Some examples are healthcare, housing, long-term care, travel, legacy. Work the list until you genuinely can’t think of anything else. And often, he says, retirees who do this exercise find that even after accounting for everything they care about, there’s still money left.
“That’s where you have to kind of press them: ‘Well, now what?'” he said.
What Money In The Bank Is For, in the End
At the close of the conversation, Jean turned the book’s central question back on its author: What is money for to you?
Mecham talked about beauty, being drawn, more and more in recent years, to beautiful things, whether that’s a well-made piece of furniture, a family trip to somewhere worth seeing, or the garden boxes in his backyard, lined up just so.
And he talked about legacy.
“When I’m long gone, I want my kids to be honest, faith-filled, and hardworking. And if you check those, they’ll figure out the rest of it. They’ll know how to answer what the money’s for. It won’t be a source of worry for them,” he said.
MORE ON HERMONEY:
- Do We Have Enough? Four Women Honest About Retirement Planning, Financial Peace, and the Money We Leave Behind
- The Financial “Invisible Labor” Women Carry — And What It’s Costing Us
- I Have No Retirement Savings. Now What?
