Make YNAB your new financial best friend

Do you have trouble making the money from your last check make it until your next check? If Something on your car broke, would you be able to cover the bill, or would you have to charge it? If you answered yes to either of those questions, I have the answer for you and it's called You Need A Budget, or YNAB for short. 

As long as I have been on my own, I've been the guy living paycheck-to-paycheck. This year I began a change in my life, and finances was one of the areas in need of immediate improvement. Sure I had a system of paying bills, buying groceries, all the mundane stuff that comes with money. The only problem I had was not being able to set aside any money for a rainy day, or a date night with the lady, or the bills that won't go away. Money was tight and we could never get ahead.

Follow me past the break to see how YNAB changed my financial life.  

I shouldn't say it changed my financial life, because it has actually changed my entire life. I love video games, and will play any game once, especially the free ones. I have a Steam account because of its free selection games, as well as software. This is where I came across YNAB, and no I'm not trying to get you to sign up for a Steam Account. At least not yet anyways. 

I watched the video and decided the 34 day demo was worth a shot, because there was no way in hell, I was going to shell out $60 for the full version. Wait!!! Don't run away just yet. I know that price is scary, but let's see if it's worth it with the demo version. Right off the bat I was amazed at how beautifully simple YNAB is to use.

When you open YNAB for the first time you are presented with this screen:

Clean and simple, just the way it should be. As you can see I have three options to choose from. When you try the demo for the first time, you should only have the two options on the bottom, "Open Another Budget" and "Create a New Budget". They will also be on top of each other in the middle of the screen. I have the third option because I already have a budget started, but removed for this review. You don't need to know how broke I am, It's sad. 

Assuming this is your first time using YNAB, let's pick the "Create a New Budget' button, and your screen should look like this:

Here you will need to give your budget a name, decide if you want it to sync with Dropbox, set the category and choose the currency and date format. I highly recommend using the Dropbox feature, it will help get it to the smartphone later in the review. Once you have made your selections here click the "Create a Budget" button and you then you should see this screen:

This is the main page of YNAB and you will see it every time you open it up. In the top left, you have; Budget, Reports, and All Accounts. There is also a yellow bubble floating on the page for you to take the tutorial. The tutorial will walk you through everything YNAB has to offer. I am just giving a quick run-through here. Adding accounts to your budget helps to fund your budget. You will have the option whether the account affects your budget or if it should be considered an off budget account. Here is a look at the create a account page followed by the budget screen: 

Here is the budget screen:

Here we can see a long list of things that eat at our money. They are divided into categories, i.e. monthly bills, everyday expenses, rainy day expenses, and so on. Each category is editable and each sub-category is too. At the top you will see a bar with the year on it and then each month following it. The grayed out months are the ones already passed or yet to pass, and the blue months are the four that you can see open on the page. Each month should have an amount in it, depending on the accounts you set up earlier, and whether they have funds in them or not. If they do have money in them then your first month should be in the green.

Under each month is three columns, Budget, Outflows, and Balance. Assuming that you have added accounts with money to your budget, start spending it within your budget, under the budget column. Cover all your regular bills, rent, car insurance, car payment, things like that. Don't forget to think about the little things. YNAB already has some ideas for you like the rainy day fund, or car maintenance as these are usually the expenses that creep up on you. Keep spending your money until the balance in the current month is $0.00. If it is in the red, you have spent too much and should go over your budget again. Making sure you correct your overture but still leaving yourself  a safety net.

If your starting YNAB in the middle of the month and have already paid some of your bills for the month, that's fine. YNAB is all about this day forward, and keeping track of what you have to pay with the money you have now. After you have everything set up, you now have to do the hardest part to YNAB, LIVING BY YOUR BUDGET! Only spend money on the things you put in your budget. If it wasn't accounted for in the budget, add it to the next budget. 

Once you have your budget set up, you need to keep track of spending for every transaction, and from which account it was spent from. If you bought lunch with cash from your wallet, record it down to the penny. Did you swipe the debit card for the groceries? If you did you need to record that too. If you do this regularly YNAB will begin to build a data base of your spending habits. You can find this information in the Reports section which we will get to shortly.

If you have added some transactions already, return to the budget screen and you can see that some things have changed in the columns. If you paid a bill that you had budgeted for, its row now shows an entry in the Outflow column and the Balance should now be zeroed out. This should be true for every transaction you have made, with the exception of accounts that have more money budgeted then spent. 

Like I was saying earlier, after you have used YNAB for some time, (this is a 34 day demo so that is short but) you can check the reports section and you will see this screen with the exception that yours should have more on it:

At the top you can see five tabs: Spending by Category, Spending by Payee, Spending Trends, Income v. Expenses, and Net Worth. If you are viewing this right away yours will be just as empty as mine. For best results you should look at this about three weeks into using YNAB. Each tab gives a breakdown of your finances based on the correlating tab. I personally like Income v. Expenses, because it helps me see the big picture of how much is going out v.s. how much is coming in.

Now like I promised earlier, there is an app for YNAB in the Google Play Store. It is free, but completely useless without the PC version. Trust me,  it is better this way because doing everything we just did on your phone would take forever. There are also some limitations of the app.

I find that I use the desktop version more anyways, only using the app for reference instead of actual entries. However if you should want or need to enter them on the go, the app does a perfect job at it.

I didn't cover the app much because it is very easy to use and as long as you opted for the cloud sync, one you sign into Dropbox from the app, there is nothing to set up or do, because it has already been done on the PC. I have included some screenshots from the Play Store of the app, and YNAB's Epiphany video for you below. It was two weeks into using YNAB that I fell in love with it and decided that the $59.99 price tag may be a little high, but the services and benefits of it were justified. 

I hope this review has at least swayed you to try YNAB. The only risk you take is a 34-day demo and no credit card is needed for it either. YNAB has taught me so much in just a short period of time, maybe it can teach you a few things too.

Also let me know what you think in the comments below. Is YNAB right for you, or are you a natural when it comes to money?

 

You Need A Budget Steam

You Need A Budget Trial

You Need A Budget Paid

Google Play Store Download