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If you’ve read any of my articles, you know how much I absolutely love my budgeting software from YNAB (You Need A Budget). It might sound dramatic, but I can honestly say finding YNAB changed our lives. It has helped us reduce stress, improve communication, and spend money in a way that matches our priorities. YNAB helped us stop adding to our debt and showed us how we can focus on paying off our existing debt. Enter the giveaway to win a full year of YNAB!
WHAT IS YNAB?
At its core, YNAB (You Need A Budget) is budgeting software. It started as a spreadsheet and has grown into a full application with tons of features. But it’s not just an app. YNAB has an entire budgeting philosophy. The magic is in the method. Find out how it works in under 2 minutes:
YNAB helps you “stop living paycheck to paycheck, get out of debt, and save more money.” The YNAB method is the main reason we’ve finally been successful budgeting and managing our money. I’ve been “budgeting” for years, but we never made progress. We had never budgeted like this! There are just 4 rules. The rules are so simple yet so powerful!
RULE 1 – GIVE EVERY DOLLAR A JOB
You assign your money to categories/jobs based on your priorities. Then you follow your plan with confidence. You don’t stress over every spending decision because you’ve already made the decisions about your spending priorities. (YNAB is a Zero Based Budget!)
RULE 2 – EMBRACE YOUR TRUE EXPENSES
Take your large, less frequent expenses and turn them into manageable monthly expenses. Common examples are car insurance, birthdays, or holiday spending. This rule makes those expenses boring and predictable instead of suprise stress bombs.
RULE 3 – ROLL WITH THE PUNCHES
When you overspend in a category, just adjust your budget by moving money from another category. No guilt. You don’t need to be perfect. Plans and circumstances change, so just roll with it. They are your priorities to adjust as you see fit.
RULE 4 – AGE YOUR MONEY
To stop living paycheck to paycheck, work to get one month ahead. When your age of money is at least 30 days old, you’ll be able to use last month’s income to cover this month’s expenses. You don’t have to time your bills to your paychecks because you’ll have the whole month covered in advance.
- Great support
- Free training & education
- Fun supportive culture
- No category history
- No forecasting
- Multiple accounts are challenging
YNAB allows you to be connected to your budget at all times with their suite of apps. The main app is web based, and there are mobile apps for Android, iPhone, iPad, Apple Watch, and Alexa.
It’s easy to get started with sample categories provided for you. You can add, remove, and change categories as you see fit.
You can view your accounts and see all of your transactions, just like a checkbook. For up to date reconciliation, you can also sync to your bank!
As you are spending money and paying bills, your budget categories are adjusted to reflect your new available total. When you want to see how much money is left for groceries, you don’t look at your bank balance. You look at your groceries category balance. This shows you that you budgeted $200, spent $63.27, and still have $136.73 available!
YNAB MOBILE APP
The mobile app is a huge reason that we have been successful. We’re all busy, and it’s not always convenient to get to a computer to check your budget. Having your budget with you at all times eliminates that excuse and makes it super easy to check the budget before you spend! You can also complete your entire budget in the new mobile app if you prefer not to use a computer. This is a big benefit for lots of people!
This is the budget screen in my mobile app (for Android). I can quickly see that I have $136.73 available for groceries, $80.00 for transportation, and $0.00 available for rent! The categories are green when they are good to go. Colors other than green could mean you’ve overspent or are not meeting your goal for the category.
Now that I’ve checked my budget, I know that I can afford to stop for gas! The menu is at the bottom of the screen, and you click the middle icon to add a transaction. The add transaction screen is simple and allows you to record transactions very quickly. Recording transactions as you spend helps you remember to check your budget first and ensures that your budget categories are always up to date.
One of the super awesome features is that the app uses your location settings on your phone to remember places you’ve been. I entered this transaction on my phone before I left the gas station. The ONLY thing I had to fill in was the dollar amount. YNAB knew I was at Speedway and it remembered which category and account I used the last time I recorded a transaction at Speedway. Of course you can change any of the info if you need to, but this makes it SO EASY to record transactions that there’s no reason not to do it. It took me all of 10 seconds!
IS YNAB RIGHT FOR YOU?
YNAB is great for everyone because you can customize the categories for your specific priorities. Whether you are budgeting solo or with a partner, YNAB works. The mobile app makes it super easy to keep track of your money all the time. I love that it syncs with my husband’s app so we are always on the same page. A budget can improve your quality of life, and YNAB makes it easy!
Whether you have $100 or $10,000 to budget, YNAB works. Since you only budget the money you already HAVE, you just make a plan for what your money needs to do before more money comes in. If you are working with a small amount of money, it’s even more important to know where every dollar is going.
HOW MUCH DOES IT COST?
YNAB offers a free trial for 34 days. It’s truly free, and you don’t even have to enter a credit card for the trial. Having 34 days allows you to see how you transition to a new month while still on the trial!
After the free trial, the software costs $83.99 a year (as of November 2017), and it is WELL worth the money. That breaks down to about $6.99 per month. Who doesn’t have $7 a month? If you don’t, YNAB will help you find it during your free trial!
It’s truly a small price to pay to get control of your finances and eliminate your financial stress! You can even get a free month when you refer a friend.
YNAB also offers a 100% money back guarantee. If you decide it’s not for you, just ask for a refund.
YNAB has a student program that gives students an entire year for free after their free trial! After the one year, students then get a 10% discount on the annual plan!
I can say from personal experience that the YNAB support team is AMAZING. I emailed a few times when I first started, and I always received a friendly, prompt response from a real person. They didn’t recite a canned answer from a manual. They responded like a friend would respond.
In addition to their support reps, they have a WEALTH of information and training available for FREE. You don’t have to sign up or pay for anything to get access to their educational materials. They even offer you customized info based on how much time you have! You can read instructions, watch videos, take classes, and follow the blog and weekly newsletter. It’s not just buying software. You develop a relationship with YNAB and they support you every step of the way!
The videos are great, but sometimes personal interaction helps! The classes are free and run by a live person. You are able to ask questions and get an answer on the spot. They even offer virtual “Office Hours” for users to drop in with questions.
I LOVE the personal aspect of YNAB. The founder (Jesse Mecham) is a real dude with a real sense of humor. YNAB started in 2004 when Jesse started selling his budgeting spreadsheet to make rent. He wanted to make enough to allow his wife to stop working when their first child was born. You can’t get more real than that.
I don’t know how, but YNAB makes budgeting fun. The first time the web app told me to “Refresh for the new hotness,” I was hooked. (That was the YNAB way of telling me there was an update to the web app.) YNAB helps reduce your stress and anxiety even further by throwing in corny lines or movie quotes here and there. Of course that’s not critical for the software, but it is great for our mindset.
It’s hard for me to think of anything negative because YNAB has helped us so much. If I look at it objectively, there are a few things that could be improved.
When you move money from one budget category to another, there’s no paper trail to show you what you’ve done. I have been guilty of moving money and then trying to remember why I did it or where I moved it to. This isn’t a deal breaker, but it would be nice.
I suspect it’s not a feature because ultimately it doesn’t matter. If your priorities change and you need to move money, you do it. Most people probably wouldn’t go back and look at the history. I have an accounting background and I like detail, but I also like the simplicity of YNAB. Perhaps too much detail would make it overwhelming?
There’s no option within YNAB to forecast/plan for the whole month. You ONLY budget money you have. While this makes total sense, I also like to have a plan of attack for all my expected expenses. I have a spreadsheet for my plan, but it would be nice to have the option in YNAB. I suppose once I’m living on last month’s income (rule 4), this won’t be as important because I’ll be able to budget the entire month at once!
Only budgeting money you have on hand is a change in mindset for most people because we’ve always been taught to budget for an entire month. If you’re living paycheck to paycheck, you’re essentially already doing this. When you figure out what your money needs to do before your next paycheck, that’s budgeting!
Multiple accounts are a little harder to keep straight because it’s hard to balance. I used to struggle getting my YNAB totals to match my bank totals because I couldn’t remember which YNAB category went to which bank account. This actually worked out to be a positive for us because it allowed us to simplify and reduce the number of accounts we use.
You don’t need 5 savings accounts for 5 different savings goals. Your goals can be handled by your categories, allowing you to have all your money in one place. When you select multiple categories, the total of the selected categories displays on the right. There are 13 categories selected. Would you ever have 13 savings accounts? I certainly wouldn’t, but I could easily have 13 savings goals!
I love being able to see SPECIFICALLY what my money is reserved for. If I had just one big category called “Savings” with a balance of $3,000, I would be way more tempted to use it. Knowing I would have to take away from another priority makes it easier not to touch the money unless my priorities change.
I took a survey of fellow YNABers in the Facebook Group to give you a broader perspective, but most people love YNAB just as much as I do! The only complaints were related to the mobile app that was recently updated. Change is hard!
WHAT USERS LOVE:
- Wes: financial control & no stress
- Kathryn: easy to track spending
- Kate: shows you what you can do, not what’s already happened; total game changer
- Allie: choice, control, flexibility
- Esther: works how my brain works
- Lee: understands money and expenses for the first time ever
- Laura: complete control of money, no spending guilt
- Jessica: security, becoming debt free
- Dorothee: accountable to goals while working on priorities
- Miriam: no longer anxious about money, YNAB IS MAGIC
- Ilona: no stress, helping to cure a spendaholic
If you want to see what else is out there before you commit to YNAB, there are a few similar web based products. Of course I think YNAB is the best, but it’s good to know your options.
Mvelopes is a budgeting software described as a digital envelope system. Their basic plan is $4/month or $40/year, but you don’t have access to the Learning Center with the basic plan. You have to upgrade to the $19/month plan to use the Learning Center. This bugs me since YNAB gives you SO much training and education for free! Mvelopes also offers mobile apps for managing your budget on the go.
EveryDollar is Dave Ramsey’s budgeting app, so it is attractive to people following his baby steps. Just like YNAB, this tool suggests that you give a job to every dollar. The basic app is free, but it does not include importing transactions from your bank. EveryDollar Plus is the premium plan that includes bank import, call back support and coaching calls for $99/year. You can try the premium version free for 15 days. EveryDollar also offers mobile apps for managing your budget on the go.
Mint is the online software from Intuit, the folks behind Quicken and QuickBooks. Mint is well known for being free and automated. In order to keep the service free, you may deal with advertising. Fans of Mint rave about the automation, but automation can also lead to not being connected to your budget. Critics of Mint suggest that it tells you what already happened instead of helping you plan for what will happen in the future. Mint also offers mobile apps for managing your budget on the go.
You already know that I love YNAB to death. It’s not JUST a budgeting app. It is that, but it’s also so much more. The YNAB philosophy is life changing. I see stories almost daily in the Facebook group from people who have improved their finances and their lives once they started using YNAB. Why not give it a try? Don’t forget to enter the giveaway for your chance to win YNAB free for 1 year!
What do you think of YNAB? Share your thoughts in the comments below!