You Need a Budget (YNAB) personal budget software has a very catchy title and claims to be a proven way to manage your money that gets results.
Claims of YNAB
YNAB is based on four principles (called rules) of cash flow management. Here is YNAB’s explanation of what they are.
- Stop Living Paycheck to Paycheck – YNAB will help you start living on last month’s income
- Give Every Dollar a Job – YNAB will help you allocate every dollar of your take home pay so you know where your money is/should be going
- Prepare for Rain – YNAB let’s you set aside your dollars so it can be accumulated for larger, infrequent expenses.
- Roll with the Punches – YNAB will make adjustments to categories that you overspend, forcing you to fix those mistakes as the next month rolls on.
Versions of YNAB
There are basically two versions of You Need a Budget:
- YNAB – This is the original spreadsheet format that the system comes in. It can be opened in Excel or OpenOffice, so any operating system is supported (Windows, Mac, Linux etc)
- YNAB Pro – The newer update was released for Windows users. Instead of running on spreadsheets, it now has a full graphical user interface.
Seeing YNAB in Action
Alright. We all know why budgets are important and YNAB certainly has big claims. How does it do what it says it does?
Register Your Expenses with YNAB
In this section, you enter your expenses as in any other budget software. The key is to enter every single expense and be accurate with your data entry. Otherwise, you are not only cheating the software but cheating yourself.
Budgeting in YNAB
Budgeting is at the heart of the program. The uniqueness of YNAB is that the budget balances actually carry over from month to month. Overspent in January? You will have less to spend with in February. If you underspend however, you can buy more in the following month.
Do I Need the YNAB Pro?
For those that don’t have Windows, YNAB Pro is automatically out of the question as it only works in that platform (as of writing). Those that want a simple, straight forward budgeting system and those that hate installing software (me being one of them) would also welcome the spreadsheet version. However, the pro version offers…
Scheduling in YNAB (Pro Only)
In the pro version of YNAB, you can setup recurring expenses so you don’t have to manually re-enter them every month. Things that work well here are expenses like mortgages, TV bills etc as it saves a lot of time and effort.
YNAB Reports (Pro Only)
If you are into reporting and love graphs and charts, YNAB Pro can give pretty nice looking ones for your viewing pleasure. Why the spreadsheet version doesn’t have it is beyond me as spreadsheets can give pretty graphs as well, but maybe that’s how they get you to buy the more expensive version.
Split Transactions in YNAB (Pro Only)
When you enter expenses in YNAB, the pro version allows you to drill down and break each transaction into different lines for its correct categories. If you want to do the same thing in the spreadsheet version, you may need to enter them as different transactions (totally doable by the way).
Is YNAB Worth It?
As with everything that cost money, it’s a personal decision. As of writing, the pro version is $49.95 and the spreadsheet version is $24.95. If you are seriously going to use the software, either version will help you and potentially save you many times more than your investment. However, if you are just going to buy the software and not put any effort in using it, you will waste your money.
If you are on the fence with this software, know that they provide a 60 day money back guarantee so there’s basically no risk in trying it. If you are serious about budgeting and is ready to try a well thought-out but simple program, YNAB is worth a try.
You Need a Budget Giveaway
YNAB was nice enough to allow me to give away one copy of the pro version of its budget software to a lucky winner! The rules are simple – just leave a comment at the bottom with a reason why you need a budget. To qualify the comment should start with “You need a budget because ” followed by your reason! The winner will be announced on Feb 28th. Good luck to all who enter.
Update: The giveaway ended and thank you for joining! Make sure you subscribe to the blog so you don’t miss out on ways to get free stuff in the future!
You Need a Budget
{ 23 comments… read them below or add one }
You need a budget because without one you cannot manage your money.
You need a budget because, “If you aim at nothing, you will hit it every time.” -Zig Ziglar
You need a budget so that you can build discipline, stop living paycheck
to paycheck and start organizing your financial life.
You need a budget otherwise you are pissing away your money
you need a budget because you are about to pay off your last credit card and you need to make sure you start saving more.
You need a budget because without a budget you are spending just to spend.
You/I need a budget because im a 20 year old who is trying to get his life together so he can start his life with his future bride.
You need a budget because you can’t get ahead if you have no clue where your money is going.
You need a budget because you need to get your money working for you instead of against you. With a budget, you take the first step toward knowing what your money is doing.
You need a budget because I wish I would’ve had one years ago! I could be much further along in life if I had had a budget years ago to keep control over my money.
(Note: I’m not entering the contest. I already own the Excel version and love it. I use Excel because I use an Apple computer at home, and a Windows machine at work. I keep the budget on a flash drive, and I can enter transactions wherever I make them; I pay bills at work on payday.)
You need a budget because you want to enjoy life! Budgeting isn’t just about restricting the use of your money, it’s about knowing what’s really important to you and going for it!
You need a budget because you want to experience living with true freedom.
You need a budget becasuse you are an unorganized wreck that spends too much money on eating out!
You need a budget for three profound reasons that Yogi Berra said best:
1. “A nickel aint worth a dime anymore.”
2. “Baseball [budgeting] is ninety percent mental. The other half is physical.”
3. “When you come to a fork in the road, take it.”
On Mr. Berra’s first point, it seems like my neighbors and friends around me are spending money on items that help to keep them up with the Jones’. Leasing a nice, brand new car, buying the maximum amount of home that they were approved for, and having more big toys that end up sitting in their garage. It’s as if we Americans have gotten so used to over-extending ourselves, we no longer know what it means to value the money we work so hard to earn….all the while watching good people we know losing their jobs and losing their incomes. It’s like we take money for granted. So many people think they know how much they are spending every month, but without a sound budget and monitoring mechanism, we are deceived.
On Mr. Berra’s second point, budgeting, like baseball, is 90% mental and the other half is physical. Budgeting allows me to take care of both the mental and physical components of my family’s finances. Mentally, I need to be aware of the inflows and outflows of my family’s finances if I want to build a comfortable and independent retirement. Physically, I need to practice sound spending and saving habits now while I am still young.
On Mr. Berra’s third point, my wife and I have been married for almost 4 years now. Issues over family finances and spending habits are at the top of the charts as causes of family tensions and divorce. My wife and I have decided that self-reliance not only builds a nest egg and rainy day savings fund, but also that it creates peace in our hearts and in our home. We came to a fork in the road early in our marriage — what direction were we going to head together in managing our finances? We determined that sacrifice now brings the greatest surety of peace, happiness, and comfort for us and our children. That is success. I love to use any tool that can help us in this journey.
You need a budget because if you don’t tell your money where to go, you will be asking where it went. Secondly, living on a budget helps build discipline and without discipline you will never succeed financially
Because….
We don’t plan to fail we fail to plan.
I need a budget because I am less than satisfied with Quicken’s budgeting features.
YNAB seems pretty straightforward in its budgeting approach. Furthermore, when you get to the point where you have followed the YNAB philosophy diligently, you have the money there waiting for you. It also has a built-in safety cushion that serves as an emergency fund and overdraft protection.
What I’m really desiring is a simple approach. I’m hoping to get that from YNAB.
You need a budget because the United States along with the rest of the world have entered a new economic era, one of which many alive today have never seen. In years past we had things good, very good and didn’t realize how good we had it let alone how important a budget is. The rapid advances we have made in technology can be compared to how important the basic skills of budgeting are in a sense to a Captain on a ship; today you set a few switches and the ship will sail itself, however should all your electronics go out unless you’re a Captain who can sail your ship by nothing but a star and the sun all the electronics in the world aren’t going to help you; never take the basics for granted. Here I am making a point for how important that basic’s are and not to rely completely on technology while competing for a piece of software and that leads me to the next most important the needed in life; a sense of humor
You need a budget because letting the big, bad credit card companies suck you dry is getting old.
You need a budget to save for the future and pay for braces for 2 kids.
You need a budget because you can’t afford not to have one.
You need a budget because you need a game plan for living within your means.
You need a budget because Quicken has less than optimal budgeting capabilities.
(Sorry for the dual post. I just realized that the rules said that I need to start my comment with “You Need a Budget because …”