Why We Use YNAB

I often refer to myself as a “recovering Quicken user.” I couldn't escape the stranglehold of what I considered robust Quicken functionality. Since the first year out of college, Stacey and I have always used Quicken to track our personal budget and finances along with my business and the two rental properties we now manage.

Every three years I forked over another stack of Benjamins for an upgrade simply maintaining the privilege of importing transactions from my bank. Each time the upgrade loomed I’d leave no stone unturned searching for a less expensive, less demanding and yet simple interface to help us to make informed financial spending decisions. I had no luck with Mint.com or Mvelopes.com because of cost or lackluster features.

I heard about You Need A Budget (YNAB) last December, tried it through the 34 day free trial, loved it and immediately switched EVERYTHING over starting January 1.

Have you ever looked at your spending decisions in the rearview mirror and thought, “Wow, where did all our money go? We make too much money to feel this way!” This week you can change all that by simply implementing YNAB and a few key principles.

Here are the top reasons I love YNAB (you can check out the features here):

- Education: YNAB’s education and support share no equal. They actually care how you budget and that you win with your money. With a ton of free videos, webinars and stellar technical support, you never feel like you’re on your own.

- YNAB Methodology: More than a piece of software, this budgeting/tracking masterpiece is built around the Four Rules of the YNAB Methodology.

- Ease of Starting: The system is incredibly easy to get started, especially since it integrates the Four Rules from the moment you open the program.

- Buffer: YNAB employs a buffer system to live off last month’s income, which makes it the only budgeting system I’ve ever seen to build this in.

- Savings/Debt Built In: Savings goals as well as debt payments and balances are integrated into the standard budgeting functions giving an ultra clear picture of how your spending impacts savings and debt.

- “Non-Evil Upgrade Policy:” The software doesn’t require an upgrade to continue importing transactions after three years.

- Cloud Sync: The app for Android/iPhone gives a real-time picture of where we are in each category on the go through the magic of cloud sync.

Whether you decide to use YNAB or not, here are my top tips for budgeting:

- Stick with one system for at least 90 days, even if it’s a pain. The first 90 days are by far the hardest, and the 90 days gives you time to figure out the system for your situation.

- Update your transactions/spending at least weekly, especially at the beginning.

- Give yourself a break. Budgeting is hard if you’ve never tracked your spending before. You’ll overspend what you plan in some of your categories (especially food and entertainment). That’s ok. Make adjustments and move on.

- I’m a hardcore believer that all spending and saving should be tracked/budgeted for, but if both spouses hate the idea of tracking/categorizing transactions, at least track the top 5 categories where you are prone to later wish you’d demonstrated greater awareness and control (groceries, food, entertainment, fun money, etc.).

With YNAB you can make quality financial spending decisions, pay off debt ahead of schedule, save for your emergency/opportunity fund, and become a quality investor far more effectively than you ever thought possible. YNAB founder Jesse Mecham often says, “You’ve never budgeted like this before.” I agree.

I use YNAB myself and consider it the best tool for you to both establish and maintain a working budget. From that foundation you can grow even further.

Caleb Huftalin, CFP®