A budget is essential if you have no idea where your money is going. You Need A Budget (abbreviated YNAB) is a mobile application that helps you “give every dollar a job” and put your money to good use.
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You don’t think you need a budget, do you? Try again. Sixty-six percent of Americans don’t have an emergency fund, and thus they’d have difficulties coming up with $1,000 if they needed it, according to the Associated Press-NORC Center for Public Affairs Research.
Families earning over $100,000 still struggle to save $1,000 in case of an emergency, according to the survey.
Why You Need A Budget (YNAB)?
Using YNAB, you may set up an automated budgeting system. If you want a system that is dedicated to budgeting and nothing else, this is the way to go.
Managing your debt and prioritizing your spending and savings can be accomplished with YNAB.
If you stick to the “YNAB Guidelines,” your spending habits will improve, you’ll have more money left over each month, and you’ll be prepared to start saving. The objective is to use last month’s revenue to offset costs this month.
Money must be at least 30 days old (a process known as “aging your money”) before it can be spent.
How Does It Work?
The cornerstone of YNAB’s ability to help you stay within your means is the Four Rules. You can stop living paycheck to paycheck and start saving effectively if you follow these guidelines.
- The first rule is, “Put a dollar to work.” Every dollar has its designated use. You will be more organized and orderly with your spending rather than spending on everything that comes your way.
- As for the second guideline, it is imperative that you “Accept Your Real Expenses.” Most people, when asked about their financial difficulties, will point to “unexpected” expenditures as the cause. But, expenses like travel, parties, and presents may and should be budgeted for in advance. Thus, YNAB advises allocating a regular sum each month to meet these commitments.
- In case something unexpected happens, rule number three is to “roll with the punches.” You may be unprepared for some costs. There will inevitably be months where your spending exceeds your income. When these events occur, YNAB suggests simply redistributing the affected funds to another account. Don’t let temporary obstacles derail your progress; instead, use them to fuel your determination.
- Four, let your money mature. You can carry over this month’s earnings into the next 30 days by spending the money you earned the previous month. When there are interruptions in your financial flow, you won’t worry. For “money aging” to work, you need to spend cash that is at least 30 days old.
Members can access a variety of live, interactive online courses on the YNAB website, such as tutorials and blog pieces on topics like making life changes, arranging for the future, and conquering debt. Here’s a deeper dive into YNAB’s functionality and most notable features.
Getting started with a budget is easy with YNAB; all you have to do is link your accounts. There is no need to worry about your financial future so long as you know how much money you have right now and how you intend to spend it until your next paycheck arrives.
Category Customization
In addition to automating your budgeting and spending, YNAB also allows you complete control over the titles and order in which your categories appear. Adding data manually and making new groupings of categories is simple.
Safely linking your accounts in YNAB makes it simple to import your transactions. By linking your accounts, YNAB can learn your spending patterns and make educated guesses about which categories to assign your purchases to. If a transaction is highlighted in bold, it is new and has not yet been placed in a specific category.
Unlike Mint, which simply sorts your transactions into predetermined buckets, YNAB suggests new buckets that you can then approve or reject. The situation compels you to become financially literate. And if you do see any suspicious behavior on your accounts, you may quickly and easily report it.
Overspending in a single area may indicate that you need to allocate more funds to that area next year. You can transfer funds across categories if you have spare change. Save it aside for fun, put it toward debt, or carry it over to the next month.
To that end, Target allows you to make multiple transactions if you’re purchasing a large number of things that don’t all fit into the same category. All of your purchases at Target may be broken down into their respective categories, whether you were there for groceries, power tools, or cosmetics.
Accurate Starting Balance
You can begin using the software with any funds you have on hand right now, regardless of whether you want to use it manually or link it to your accounts. If your starting bank balance is $225, then it is the amount from which you will deduct all of your monthly bills.
It will display a red line if your budget requests more funds than you currently have available.
You can use YNAB to securely link your bank and credit card accounts, or you can enter your transactions into the program manually. The final step is to import your transactions into the appropriate budget categories.
You Need a Budget is actually only built to work out of the box with bank accounts, so keep that in mind. Technically, YNAB offers two alternatives for keeping track of investments, but doing so requires significant effort with either method. Check out one of these portfolios monitors as an alternative if you want a more streamlined approach.
Set Up Sinking Funds
Whenever a large expense arises, you may simply transfer the funds from your sinking fund into your emergency fund in YNAB. What exactly is a sinking fund? It’s like putting money away for a “rainy day,” only you’re saving up for a substantial bill in the future.
The $258 annual cost of vehicle registration is only one example of a tiny expense that could be accounted for with a sinking fund. Including $21.50 per month in a new line item for vehicle registration is all that’s required.
Auto Assign
With “Auto Assign,” your new monthly budget can be easily filled out. Underfunded, Assigned Last Month, Spent Last Month, Average Assigned, and Average Spent are the alternatives available for the automatic allocation of cash.
YNAB isn’t just accessible online; there’s also an iOS and Android app you can download. The same credentials that you use on your computer can be used here. In addition, mobile apps offer the full complement of features found in the web interface.
You can use YNAB on your phone, iPad, Apple Watch, and even an Amazon Echo to access your budget.
How Much Does It Cost?
Whether you choose to pay $14.99 monthly or $98.99 per year, you can rest assured that you will experience a significant return on investment by using YNAB. For those who want to test out YNAB before committing, there is a free version available for 34 days. And the best part? Credit card details aren’t even requested.
The college student version of YNAB is presently free for a full year. Providing “evidence of student-hood,” such as a student ID, tuition statement, or transcript, is all that is required to receive your free academic year. There is a time limit on this free membership offer for students. If you like YNAB and want to keep using it after the first year is up for free, you can save 10% on the yearly plan for a limited time.
How Do I Open An Account?
Simply go to YNAB’s website and click the prominent “CHECK IT OUT” button to begin using the program. Creating an account is as simple as entering your email address and creating a password. As an alternative, you can sign up for YNAB using your existing Apple or Google account.
When it comes to safety, YNAB is a serious business. The program and app use numerous cycles of a key derivative function to encrypt data, so you can rest easy knowing that your financial information is safe. If you cancel your account, all of your information will be permanently deleted from their servers.
Is It Worth It?
The YNAB software can help you become more financially savvy and get back on track if you’ve been having problems sticking to a budget and as a result are deep in debt with little savings.
Most people lack the self-control required to maintain a budget without some outside intervention. Make the most of the risk-free introductory period of 34 days and give it a fair shot. We guarantee you won’t be let down.
