With Mint no longer an option as a budgeting app, you might wonder what financial advisors recommend as an alternative solution. Our advisors recommend YNAB! Check out our blog below and the podcast on YNAB:
If you’re currently using a budgeting software that you love. Great! If not, and you are looking for another option, we recommend YNAB to our clients, family, and friends. Do you have reduced income right now due to the Conronavirus? Do you need a new way to budget right now? We highly recommend YNAB, which is an acronym for “You Need A Budget.” YNAB states that, “On average, new budgeters save $600 by month two and more than $6,000 their first year.” If this claim is true, then investing in it would be a no brainer, right? Recently, Tim Goodwin, president and founder of Goodwin Investment Advisory started using this app himself and this is what he has to say about it. “It takes about 3 weeks to get used to it, but once you do it is so worth it.” Joanna Howard, Director of Client Services is now using it as well and the rest of the staff is following suit. Tim even loves it so much he is now providing the paid service as a benefit to the entire team.
What makes YNAB different. Well to be upfront, you have to pay for it… $83.99 a year, but the company promises it is worth it, declaring– “that is how much better it is!” (FYI – this is cheaper than everydollar) They even say, “you don’t hear that mint.com changed my life.” – meaning that YNAB will do just that – change your life. *(If you’re a college student you can get YNAB 4 for free for 12 months – you can simply email email@example.com with proof of registration)
YNAB’s mission is “to help you gain total control of your money, stop living paycheck-to-paycheck, get out of debt, and save more money.” They claim that their award-winning software really works and is a time-tested proven method. The budgeting tool teaches you how to truly manage your money and pay your bills directly when they come in. YNAB allows you to have complete and total control of your money, teaching you how to spend smarter. (your budget doesn’t have to become more restrictive) But, it does require some work and it does take some getting used to.
Check out this video on YouTube to learn more about why you should use the app.
YNAB teaches you how to budget together by providing access to real-time information, from any device at any time, which makes it extremely easy to share your finances with your partner and not accidentally overspend at Target, Best Buy, or Amazon. The goal tracking component is helpful to create, set, and reach your budgeting goals. Budgeting isn’t about being restrictive, but it is about meeting your goals each month and then setting new, and bigger goals and doing it again every single month. According to their website, “YNAB teaches you how to prioritize and plan, so that you have money for the things that are most important to you.” They provide you with charts and graphs so that you can visually watch your progress. We all have a little nerd in all of us and love to track our growth and improvement. Plus, YNAB provides excellent customer support and is truly invested in your success. The staff is even available by live chat. Or, you can check out some of the free online workshops that they offer to help you.
Our reasons for choosing YNAB:
Tim found that learning to use this system can be a bit tricky and a little confusing at first, but once you learn how to do it you’ll be hooked and it will really affect your finances in a positive way. You will discover why he believes it is hands down the best budgeting tool available today.
- It’s proactive and not reactive
- It creates intentionality about how you spend every single dollar – prioritizing
- You are in control of your finances – you make your own decisions and learn how to make better ones.
- The focus is on what is in front of you and what you can still have the ability to influence and change
How does it actually work?
The four rules:
- Give every dollar a job.
- Get some dollars
- Prioritize those dollars – meaning assign them all a job
- Follow your plan
- Embrace your true expenses
- Find a big, infrequent expense
- Create a goal to fund it monthly
- When that expense arrives, just pay it!
- Roll with the punches
- Choose a category with overspending
- Move funds from another category to cover it
- Move on with your life – no guilt
- Age your money
- Be purposeful in your spending
- Consistently spend less than you earn
- Watch that age of money grow.
Some helpful hints before you get started:
- Depending on your learning style you can watch the video course, or learn with a live person on one of 10 different workshops offered, or you can download a readable guide, the “Ultimate Getting Started Guide.”
- You won’t be forecasting, but instead allocating the dollars you have in your bank account right now. This will take some getting used to, but once you do, you will love it.
- Use a budget template – https://www.youneedabudget.com/how-to-create-a-budget-template/
- The month is going to roll-over and with a new month you will notice changes in your budget. Your overspending disappears – YNAB automatically deducts the overspent amount from the “To be budgeted” in the new month. Watch this video on how to manage your monthly roll-over.
- You will fill out your budget each month. Go down the list – category by category in order of priority until your budget gets to $0.00. Once you have more history (at least 4 months) then you can try out the “average budgeted” or the “average spent” in Quick Budget.
- Make sure your budget matches your account balances.
- Direct import allows you to see all your transactions in YNAB. This sometimes takes up to 2 days to clear your bank. So, it is best for you to keep track of your spending right away. Once the transactions actually import, then it will match up with the ones you physically entered.
- We hate debt: Make sure you reserve money to pay off that debt (any amount you have put on credit cards) Watch this video on how credit card work in YNAB https://youtu.be/AgHsmo-MLwQ
- Savings – Make sure you allocate a portion of your budget to go to savings. And, create sub categories of this savings for vacation, new car, job loss, marriage course, etc.)
Here is a video we thought was actually more helpful to learn how to use the app once we started using it ourselves. Follow Nick True on YouTube and watch his videos.
Try YNAB for free for 34 days.