You Need a Budget or YNAB has been one of the most popular budgeting apps for years. And it’s no wonder: YNAB is awesome! In this YNAB review we go over all the ins and outs of this incredible app so you can see how it can completely transform the way you manage your money.
However, YNAB does take some getting used to. That’s why YNAB offers a 34-day free trial, because you need just over a month to get the hang of it. Once you do, YNAB is life-changing!
This budgeting app is 100% worth it’s pricetag. YNAB is far and above superior to any other budgeting software out there, including some of the most popular apps like Mint. Read on in this YNAB review to hear about why this might be the only tool you need to manage your money!
I’ve been using this app for more than 2 years now so I feel confident giving a solid YNAB Review.
You should be aware that getting the hang of You Need a Budget will take some time and be a little uncomfortable. You might even get frustrated and tempted to switch to a simpler expense tracker. But I promise you, if you stick with YNAB, you’ll love it.
The YNAB Budget
YNAB is more than just a budgeting app, it’s budgeting a method. While this is why You Need a Budget is such a great tool, it also makes for a steep learning curve compared to other apps out there.
The Four Rules of YNAB
YNAB operates on four specific rules for your budget:
1. Give Every Dollar a Job. Every dollar that comes into your bank account gets assigned to something. Whether it’s paying bills or going towards retirement savings, no dollar is off duty!
2. Embrace your True expenses. True expenses are infrequent but expected expenses. Things like your once-a-year property taxes or Amazon Prime fee fall into this category. You usually forget about them until they happen. Not with YNAB!
3. Roll With Punches. This is about keeping flexibility in your budgets. If you go over in one spending category, you just move money from another to cover it. The only rule is you can’t spend more money than you have!
4. Age Your Money. Aging your money is about breaking the paycheck-to-paycheck cycle. Essentially what the app is trying to get you to do is get your money in your bank account and sit there. And sit and sit and sit. Once your money sits for 30 days before you spend it, you’re a month ahead on all your expenses and can breathe easy knowing you have comfortable cashflow for upcoming expenses.
Using a budgeting app that has its own “Rules” that don’t even make that much sense at first glance can seem weird. But they are integral to the YNAB method and you’ll find yourself a fan once you put them to work!
How to Use YNAB
Getting started with YNAB is easy, but you should definitely allocate some time to get it set up the way you want to. Carve out a nice Sunday morning and brew a big cup of coffee and sit down to do your budget!
Below is a step by step guide to setting up YNAB:
Import your bank data
Once you sign up for YNAB, you can add accounts manually or you can elect to have the app scrape your bank accounts to pull transactions in automatically. Depending on how many bank accounts and credit cards you want to track, this can take anywhere from 1 to 3 hours.
Like I said, setting YNAB up properly is a serious time investment but it’s the only way to access the power of this tool to manage your money.
Create your YNAB budget
You can create your own budget from scratch, or use YNAB’s “quick budget” feature which will use the most common budgeting categories most people have.
I’m still married to the Money After Graduation Budget, so I set it up my core 5 categories in YNAB: Housing, Transportation, Savings, Debt, and Life (which I further broke down into Food and Variable Expenses).
YNAB also includes “Credit Card Payments” as a category, because it’s not really debt and it’s not really spending either. If you’re a regular credit card user, you’ll appreciate the YNAB makes you pay off everything you charge to your credit card. You can’t get away with using plastic like free money this way!
You can set up your YNAB budget according to the 50/30/20 Budget Rule or another method, or you can just use the template YNAB provides and modify it as needed.
Track your spending
If you have YNAB connected to your bank accounts and credit cards, it will automatically pull your transactions as you make them. Otherwise, you can manually enter them throughout the month as you go along.
YNAB gets smarter the more you use it, so as you enter regular shopping destinations it will remember the categories they belong to and auto-categorize them going forward.
You can edit the categorizations if they’re imported wrong, or you can even split transactions if you spend in multiple categories at a single store. As someone that regularly picks up Baby Clothes while I buy Groceries at my local supermarket, I appreciate the ability to split up my spending into the appropriate categories.
YNAB will let you easily set your financial goals directly in the app. Whether you’re looking to pay off debt or save money, there’s options to set up your financial goals to reach a certain balance or contribute a certain amount each month or year.
I personally set a goal to contribute at least $2,500 to my daughter’s RESP each year, and I usually try to hit this target before her August birthday. YNAB lets me know know every step of the way if I’m on track to hit my target based on my monthly budget allocations to this savings goal.
You can customize YNAB as much or as little as you like, but there some simple hacks to make the tool more useful and easier to use.
Put due dates next to the names of your expenses
This is such a simple but wholly transformative task of managing your expenses in YNAB. Next to the names of recurring regular monthly payments, type in the due date the bill is paid from your account.
I find being able to see bill due dates next to my expenses helps keep me from thinking I have more money than I actually do! If I wonder, “why is there so much extra cash allocated here?” I can just open the category and see what bills haven’t come due yet.
Connect YNAB to Undebt it
If one of your main financial goals is paying off debt, you may already be using the incredible free app Undebt it. You can connect YNAB directly to Undebt it to have your debt balances automatically update as you pay them off.
You might wonder why you need Undebt it on top of YNAB. Isn’t one app enough? While it’s true YNAB comes with plenty of its own functionality to help you pay off debt, Undebt it is a unique tool that provides more robust calculations to compare debt repayment methods and get to debt-free faster.
YNAB costs $104/year for Canadians and $84/year for Americans.
You might balk at that price tag when there are so many free apps out there, but the average YNAB user saves $600 within 2 months of using the app. Talk about a return on investment!
You can download YNAB directly from the Apple App Store, and your membership will be charged directly to your Apple ID. Likewise, it’s available for Android on Google Play. You can also use the YNAB web-based app, which is my preferred way to access the platform.
Is YNAB worth the price?
Yes, YNAB is absolutely worth it’s price! I feel like I can’t say this enough times because I am so in love with the app.
If you’re not sure if YNAB is worth it, just try it out.
YNAB vs Mint
If you’re looking for a good budgeting app, there’s no doubt Mint has crossed your path. Mint is a tempting choice because it has a lot of functionality and is absolutely free to use.
Where YNAB and Mint fundamentally differ is Mint is really just a spending tracker, whereas YNAB is a budgeting method.
Both apps will track and categorize all your spending, but YNAB will get you to optimize your money and Mint will just let you look at it.
From a purely technical standpoint, YNAB is seamless and Mint seems to never work out its glitches. Seriously. I haven’t used Mint in 10 years and in that entire decade they still haven’t seemed to resolve all their issues synching to bank accounts!
Final thoughts on this YNAB Review
At the very least, YNAB is worth a try! After all, you get 34 days to see if it really changes your behavior and brings you closer to your financial goals.