***This is not a sponsored post, I don’t work for YNAB nor are they compensating me at all for writing this. I wouldn’t even bring it up, let alone write this entire post about it, if I didn’t absolutely LOVE it!
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I am a sucker for apps. My iPhone and computer are full of them. I have one for just about everything you can think of. However, when it came to finance and budget apps I was sorely disappointed.
After trying to keep up with our finances and budget for years, using every program that looked worth trying, and then trying to create my own system, I was at a loss. So I did some serious research for some kind of software/app that would help me stay on top of this mess, because seriously, that’s what it felt like. One. Big. Mess.
I had heard of YNAB (You Need a Budget) a while back and the philosophy of living on last month’s income. It was appealing so I looked it up. Lucky for me they had a free month trial so I downloaded it.
This is no joke folks. This software has changed my life! Actually, it’s not merely just a software. It’s a whole new philosophy and approach to budgeting for me.
Here are 5 reasons why I can’t stop talking about it:
1. Easy to Use Categories
I once got it in my head, after reading about it on a finance blog, that I needed to have 7 different bank accounts. Maybe you are familiar with this concept. Let me tell you, it didn’t take long to realize that was way too much for me to handle. I’m a simple girl and want a simple plan and although it didn’t sound too bad when I read about it, implementing it was entirely different. YNAB makes it easy to categorize your expenses but keep all the money in one account. You can easily set up additional accounts and additional budgets but for most families, one main account and budget is sufficient. You don’t have to take out cash and divide it up between categories represented by envelopes (which was also WAY too much work for me…how do you get the right amount in each category unless you’re using multiples of 20?) All the money that you budget, stays in your account but on your YNAB screen you can see exactly where every dollar belongs. However, don’t think you’re cemented into your plan once it’s made, you can easily borrow and transfer money between categories.
The relief of knowing where every single dollar goes and of course, still having the flexibility to change it up, is so nice. I don’t care how much money is in my account anymore (although it also makes that easy to follow with a sort of built in check register), I care about how much money I have budgeted in each particular category.
2. Budgeting with Real Money
Instead of setting up a budget for the entire month with anticipated income, as I have miserably failed at for my entire adult life, YNAB encourages you to only budget when you get money. Since I have always lived paycheck to paycheck anyway, this really works for me.
Obviously, the goal is to get away from paycheck to paycheck kind of living and eventually be able to create a budget for next month, with income that is already in your bank account from last month. I can’t tell you how badly I want to be able to do that.
For now, I only have to follow my budget paycheck to paycheck. For us, that’s every week. It takes me about 5 minutes to go in and budget out every dollar we received today by way of a paycheck. Then, I just use the app on my phone to make sure I stay within that limit, just for the week. If I don’t use that money I budgeted towards clothes, it still stays in that category and I can keep adding to it to use later (hello guiltless impulse shopping!), or I can move it to another category that takes priority right now.
3. Provides Peace of Mind
You know when you map out a great budget and think, “YES! I’m really going to do it this time. This is my budget for the month and I’m sticking to it.” Then halfway through the month you remember you have to register your car this month, or your son ruins his only pair of church pants so you need to buy another pair, or maybe that STUPID Disney Movie Club sent you another featured title because you forgot to decline it in time and they took $40 out of your account automatically. This kind of stuff happens to the best of us but that may be $150 you didn’t budget for this month! YNAB helps you to plan for these things and helps you get a jumpstart on quarterly or annual expenses that we inevitably forget about. After budgeting all the expenses I have to pay for this week with our weekly check, I use whatever is left over and divide it among upcoming rainy day funds (such as car registration, putting our garden in, Christmas, etc.) Of course, there’s also the Buffer savings category to help us work toward the goal of saving until we can live on last month’s income. I can’t wait for the day when I can budget once a month, with money I already have, and not worry about it the rest of the month. Talk about peace of mind!!!
We also decided that we’re done stressing about Christmas money in December. It’s going to have to come from money we’ve saved throughout the year. It’s so easy to set that money aside in a category in YNAB and just add a few extra dollars when I have some left over. I don’t have to deal with a million separate accounts or take out cash or use envelopes. I just depend on my budget set up in YNAB to know where all the money in my account actually belongs. It creates this buffer where you never have to worry about your checking account going in the red as long as you are always reconciling those red numbers in your budget, borrowing and transferring between categories. The math is all done for you so there’s really little room for error.
I hate dealing with money. I like to spend it on fun stuff, but the whole financial world is mostly a mystery to me. I hate having to constantly keep track of where everything goes and pay for things like insurance and rent. However, I realize that it’s a part of life that will never go away. So anything that makes it easier and is moving me toward less stress in the future, I’m on it.
4. Helps Me Prioritize
I’m writing this post because I know how bad it sucks to have to think about your finances and try to tame the beast. It’s even harder when you’re married and the two of you are trying to work it out together. There’s always differences of opinion or one of you (or in my case, maybe both of you) who consistently fail at following the budget. That’s why I love this program so much. If I go a little over, I borrow from another category. This helps keep me accountable because I’m using only the real money that is currently in my account and I know I can’t overspend and hope to make it up later. If I overspend, I know I have to take the money from somewhere so it helps me prioritize. Again, it’s like a game, transferring money between categories until all the red numbers are gone.
For example, I REALLY want a water softener for our house. I had a guy from Culligan come down and give us our options. We decided that in our situation, renting for a year and possibly buying it out at the end was our best bet. It’s only $130 to install it and for two months now I keep thinking I should be able to come up with it. The old Lacie would have just scheduled to have it done and worried about how to make up that $130 later. The new Lacie with the YNAB software has looked, with every paycheck, and realized we’re still catching up from Christmas. Hopefully, we’ll be able to get on top of this soon (and it’s looking that way) so that I can finally get my water softener.
5. Super Efficient
I used the program and its accompanying app for a month and bought the software. It’s not complicated like other software that I’ve tried to use in the past. It’s meant for people like me who hate to budget and need to get on top of it. I watched the hour long getting started tutorial and I’m so glad I did. It lays it all out and it’s actually super easy and intuitive but watching the video helped. I love that I can make a budget and use my main checking account for our family’s finances and just as easily make a separate one for business. The app makes it easy to stay on top of each category and real time syncing means my husband can use it on his phone too so we’re always on the same page. No more text messages “I need gas, how much is left in our budget?” Now he can check the app and see if I got gas that day too and how much is left over.
I used to think the best way to handle finances in a marriage was to split it up. However, I much prefer working together on it and since we both have savings goals we really want to meet, uh hum…buy a house, we are more willing to work with each other and agree how much money is going where.
It’s easy to set up your categories and automate payments and things as recurring transactions. The more you use it, the easier it is to use. Not only that but the website has amazing tutorials on all kinds of things like how to categorize cash, how to handle credit card debt with the software, and how to use all the great features the program has to offer. Even if you never watched any of those videos, the program is totally functional.
The icing on the cake is…the price. One time, I spent an entire week working on an excel spreadsheet that I called “Our Family Budget.” I don’t know how many hours I spent on it, but I would venture as to say some 12 hours or so. It was several workbooks in one excel document including one for income, one for expenses, a calendar, a list of debts, etc. So let’s say I was paid $10 an hour (which is pretty reasonable for that kind of work I think). That means I spent $120 of my life working on that budget. I bought YNAB for half that, $60 after a free month.
If your budget needs a facelift, or you need to start one from scratch, try the free trial. There’s no credit card required to try it, you only put in your payment information when you’re ready to buy it. When you are ready, you can save $6 by using this link: http://ynab.refr.cc/KDPC652. So you’re only paying $54 after a month of using it and it’s yours for life, including the app.
I can’t praise it enough and although everybody is different when it comes to dealing with money, I feel like this program is the simplest and most flexible for most people.
How do you tame the budget beast?