Should There Be a Budget for ‘You Need a Budget’?

Do you need a budget? While this may seem like a typo (or some kind of vague Zen Koan), we’re just posing a question about an app called You Need a Budget, which we’re going to eliminate from here on YNAB (like they do). will ask to do. no illusions. YNAB does only one thing—helping you create a budget and stick to it—and it does it really well. But is it worth the relatively high annual fee? let’s take a look.

After setting up YNAB, you will be asked to link your banking and credit accounts if you wish. Doing so allows the app to pull in all your financial transactions which can then be assigned to different spending categories. If you’re not comfortable handing over this information, you can also enter transactions manually, although the company uses some serious encryption algorithms, so security doesn’t seem to be an issue.

In any event, you may initially assign a transaction to any of the five categories of the App: Immediate Liability; right expenses; Loan Payment; quality of life goals; And just for fun. While YNAB says these categories can let you budget quickly and effectively, you also have the ability to change the name of any category as well as add new ones.

Once your transactions are recorded (or imported), YNAB will help guide you through their four-pronged approach to managing your money wisely. The main driver of the app is that it will require you to “give every dollar a job”. This means that for every deposit you make, you have to specify each percentage of it in one of your categories. The second principle the app uses is the idea that you should “embracing your expenses,” which means that not only should you cover regular monthly bills like utilities, but you also need to cover long-term expenses like property. For this, a little savings should also be made every month. do.

The third YNAB principle is “roll with the punch,” which basically means you’re allowed to take your money out of the ranges you put it in, should unexpected expenses arise. For example, if you need a car repair, you may need to take some money out of your “life goals” or “just for fun” categories. Ultimately, YNAB will guide you through the “age of your money” so that if you live paycheck to paycheck, you’ll be able to start moving forward from having enough in your account to cover your expenses. before this you get paid.

In addition to helping you split your money this way, YNAB also offers an extensive library of video lessons, has tons of question-and-answer opportunities, and even lets you meet with a personal coach. to help you understand and use the app.

So it’s pretty clear that YNAB has the right tools and strategies to help you take control of your spending and work towards your financial goals. Its color-coded charts and graphs and easy-to-access interface (available for all major desktop and mobile platforms) transforms even what seems to be a monotonous task into an entertaining game-like endeavor. But… is it worth its price?

The answer is, it depends.

If you purchase YNAB on a monthly basis, each payment will be $11.99. Sign up on an annual basis and you’ll save some cash, but you’ll end up paying $84 per year. Clearly if you are someone who struggles to budget, save or hold on to your spending then you can definitely make up for that cost by using YNAB to improve your financial picture. According to the company, people who are new to budgeting save an average of $600 in their first two months and $6000 after one year. If you were to see similar results, the app’s fee is a no-brainer.

But when you consider that other apps like Mint also offer you a way to track, categorize, and budget your spending for free, you might do your best to try them first.

Still, YNAB is an active app, helping you decide where money is going before you spend it, rather than tracking it after the fact like Mint does, so there’s some value there.

Perhaps the best idea is to take advantage of YNAB’s 34-day free trial. This will let you get acquainted with the program, learn a thing or two, and find out if it will actually help you save. No credit card is required for sign-up, so it’s very easy to finish your trial, which is another reason why the software is easy to recommend.

Download YNAB here.

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