All opinions in this post are my own and based on my experience; this is not a sponsored post. That said, I believe YNAB is a great tool, so I have partnered with them to bring this special offer to Centsibly Rich readers.
A month ago, I received a powerful email from a reader. His lifelong struggles with “unconscious spending” had affected every facet of his life, including his relationships. He couldn’t fathom a “budget” helping him in any way but, on the advice of a trusted friend, he signed up for You Need a Budget (YNAB). The YNAB system completely transformed his life, financially and otherwise. Though he admits it was difficult to start the process of getting control of his finances, he reports a new, profound sense of freedom and control in his life.
Needless to say, this reader’s email grabbed my attention.
I’ve since heard from others how YNAB helped them gain control of their money. You may have read Linda’s Debt Free Story about how her and her husband started using YNAB and continue to use it faithfully to keep control over their finances.
Even though I wasn’t sure it could help me, I decided to start using YNAB myself. I had never previously used a “budget”, per se, because categories with spending restrictions just don’t work for me (just like diets!). So, needless to say, I was a bit hesitant about YNAB.
When I started using the system, I realized it isn’t a strict budget at all. It’s about tracking your spending, expenses, and income, and living within your means. YNAB is also flexible and can be tailored to your needs. So, though it has the word “budget” in it’s title, YNAB is actually more of a system for managing your money than it is a budget.
Who needs YNAB?
Anyone who needs to get their finances under control and stop living paycheck to paycheck will benefit from the YNAB system. After putting in the initial set-up time and then following through on regular updates on spending, expenses, and income, it will help you gain control over your money.
YNAB will only work for those willing to put forth the time and effort to get it started and maintain it. If you aren’t ready to take action and follow through on getting your financial ducks in a row, it won’t work for you (but, then, neither will anything else). For those of you ready to take action, but just aren’t sure where to start, YNAB provides the system and guidance for getting you started. Plus, if you are willing to put in some time and effort, you will be amazed at the results.
And it’s not just for those just getting started. I’ve been tracking my spending for more than a decade and feel like I have a good handle on my finances. Yet, YNAB is working and has really kicked in the accountability factor for me. Anyone who wants to have a system in place that accounts for every dollar going in and out of your life can benefit.
The positives
YNAB:
- Provides online classes, tutorials, a blog and so much more
- Makes linking accounts easy
- Helps you start living on last month’s income (no more paycheck to paycheck)
- Keeps you accountable
- Requires you to pay attention to your finances on a regular basis
- Allows you to set goals for larger expenses and break them down into manageable, monthly chunks
- Is flexible (there are no set limits on categories, you can move money from one category to another)
The negatives
- Getting started can be a bit confusing and time consuming (use the tutorials!)
- You have to use and maintain it on a fairly regular basis (not necessarily a bad thing, though)
- It costs a minimal fee (but they say you’ll save an average of $200 the first month)
Centsibly Rich readers can use this link to sign up for 3 months of YNAB for FREE!
Check out how it works on this video
My take on YNAB
In my opinion, YNAB is a fantastic personal finance tool that works, as long as you put in the time and effort. It’s a great way to break the paycheck to paycheck cycle and gain control over the money coming into and going out of your life.
For me, there was a bit of a learning curve to getting started. I made the mistake of not watching the videos and going through all of the tutorials at the very beginning. Now that I have went through a few tutorials and used the system about twice a week for over a month, I’m starting to really get the hang of it.
I do think you have to give YNAB more than a month to get a handle on how it works. You have to put in the time and effort to learn how to use it and get everything set up. But once you do that, and update it on a regular basis, it could literally change your life.
Cost
YNAB offers a free 34 day trial and the cost is $5/month or $50/year (but you can get 3 months free through this link). Remember they say you will get that much and more back if you continue to use the system regularly.
I’ve only heard of YNAB in passing before so I appreciate the overview. It definitely sounds like a helpful tool. I began taking my expenses about ten years ago myself (using spreadsheets in the beginning) and haven’t stopped since. I find it very insightful to know where my money is going and helps immensely in finding areas to cut back.
I couldn’t imagine being where I am today without having such a good handle on my financials.
YNAB is a great tool! But no matter how you choose to do it, tracking your spending/expenses is an absolute necessity for taking control of your money.
Like you, I started using YNAB when I already felt like I had a solid grasp on my finances. It still helped a lot. The biggest areas I found it to be helpful are:
1. It helps with planning for annual expenses (like holiday shopping!) that usually come as a shock to your bank account.
2. It is, in my opinion, the best tool for paying yourself first. You set aside money for specific long term goals and have to make a conscious decision to take the money out.
Thanks for sharing your experience with YNAB, Matt. Planning goals and large expenses is one of my absolute favorite things about YNAB. It really lays it all out there for you.
Thanks for the overview Amanda, sounds like a great tool! I think that tools like these make it so easy for people to get started down the path to financial security. You don’t have to be a money Nazi with so many great tools available!
Exactly, Jon! There are a ton of great tools out there for those that don’t want to create their own spreadsheets or just don’t know where to start. And, though I’m still pretty attached to my spreadsheet, I have found YNAB to be a helpful addition to my finances.
Yes, you know I love YNAB! I have the older version that you buy only once. I’ve heard mixed reviews on the newer version where you pay monthly, so I never upgraded. But I am sure it is still worth it. It just takes a few months to get used to. Now it is such a habit, I don’t make a single transaction without immediately entering it into the YNAB app on my phone. Highly recommend.
Yes, Linda! I love that you have gotten to the point that it’s a habit. It takes a while, but once you get to that point, it becomes almost effortless! And, I agree, it takes a little while to get accustomed to using it, but once you do, it’s so worth it.
YNAB is getting a loyal following in the UK, and from what I’ve read, it’s really life altering, especially for people who haven’t yet got a handle on their spending. I think it’s the ‘how old is your money’ stat that keeps people who are usually spenders, hanging on to their money for as long as they can so they can get up to at least a month. Increasing the age of your money is a much more positive goal than thinking about how much you can cut out of your budget. 🙂
Hi Sarah! That’s great to news – I’m so glad to hear it’s gaining traction in the UK. I really love “how old is your money” on YNAB. What great motivation to start living on last month’s money rather than anxiously depending on the very next paycheck!
I really would love to dig into this tool and just might make it a priority soon. I honestly would have checked it out a long time ago if they had an affiliate program. Would be nice if they added one!
Yes, DC, from my experience and what I’ve heard from others, I think it’s a really great tool. Agreed, it would be really nice if they had an affiliate program. 🙂
I don’t use it myself, but I’ve heard good things from people who do. I also have heard that YNAB is a great place to work. Their founder sounds like a really good person. YNAB allows it’s employees to live and work wherever they want, they believe in 40 hour weeks and have a minimum vacation policy. They also make new employees fill out a ‘bucket list’ when they join and YNAB helps you knock off a couple items off that list every year!
Thanks for sharing, Mrs. BITA! I think I remember reading the same thing about the company a while back. It’s great they treat their employees so well; that speaks a lot for their integrity. I love the “bucket list” idea!! 🙂
I was not aware of the 3 month free trial, the extra free time is pretty cool. Thanks for sharing.
I might give it a shot during the road trip, though without predictable income I’m not sure how useful it would be vs. Mint, unless it has more of a behavioral effect.
Interesting software! I’m a big fan of programs that take in your spending data and organize it for you. To do all of that stuff yourself would take way too long and be almost counterproductive. The cool thing about budgeting is that once you get a handle on how much money you’re spending, it later becomes intuitive – almost to the point where you no longer need it.