I had used Quicken for many years before stumbling on YNAB (it stands for “You Need A Budget”). The YNAB concept is very different from Quicken or other Quicken-like tools. Primarily, it is not an accounting software telling you in which accounts your money can be found, but rather it is a true budgeting software that helps you manage where your budgeted money is.
YNAB operates under 4 rules, which are explained very well via the website and free periodic webinars held by the YNAB team:
- Give every dollar a job
- Save for a rainy day
- Roll with the punches
- Live on last month’s income
By shifting how you think about budgets from “how much do I have in checking” to “how much do I have in my entertainment budget”, you can really see where you are spending your money, as the budgets roll from month to month. With Quicken, if you go over/under in certain categories for a month, you just tell yourself you will try and do better next month, but the behavior never truly changes.
The initial investment of $60 may feel steep to some when compared to Quicken ($40-50), but the savings you’ll soon gain will more than compensate for the upfront cost. There is also an iOS/Android app, which syncs wirelessly to the cloud (using Dropbox) and allows your budget to be fully up-to-date, whether you check it on your iPhone, your significant other’s Android, or your home PC. You can enter your information immediately at the time of purchase and assign the purchase to the appropriate budget category.
All in all, I couldn’t be more pleased with YNAB. I have a full picture of where each of my dollars are budgeted, and it has changed my spending behavior to be more in-line with my financial goals.