You Need A Budget 3

You Need A Budget 3 Review (YNAB) – Ultimate Personal Budgeting Software


You Need A Budget 3

Creating a budget is essential for keeping on top of your finances, but drawing up your own often creates too much headache and not enough results.  We all know that budgeting is important, but actually sitting down and taking the time to write one is another story.  Fortunately, you don’t have to if you sign up for You Need a Budget (YNAB), because this budgeting software does the hard work for you.

What Is It?

YNAB uses what it calls the “Four Rules of Cash Flow” to help you manage your cash. These are fully explained in the introduction to the software, but here is some brief information on the four rules.

Rule One – Stop Living From Paycheck to Paycheck. Not having a good handle on your money can create tremendous stress, and this rule is intended to develop crucial budgeting skills to avoid this.

Rule Two – Give Every Dollar a Job. Once you’ve set financial goals, you want to reach them as quickly as possible and this rule helps you to do this. Every single dollar has a role, whether it’s paying bills, building an emergency fund or being set aside for irregular bills that need to be budgeted for.

Rule Three – Prepare For The Rain. Emergencies will crop up and this will often be when you’re least prepared. Creating an emergency fund is the best way to deal with these unexpected and unwelcome setbacks.

Rule Four – Roll With The Punches. Things won’t always go according to plan, but this doesn’t mean that your financial goals have to be compromised. If you happen to overspend one month, that amount will be taken out of the following month’s available income.

Let’s look at an example to see how this works in practice. Imagine that you’ve allocated $1,000 as your budget each month, but unexpected circumstances caused you to actually spend $1,100. The extra $100 that you didn’t intend to spend will be taken out of the next month’s budget, and you’ll thus have only $900 to play with. You can choose which areas to cut back on to make up the difference. This feature isn’t present in most other budgeting programs, so it makes YNAB pretty unique.

How It Works

1. Add the accounts that you’ll be tracking

To add accounts, you’ll need to include the following information:

  • Name (for example, checking account’)
  • Current balance
  • The date on which the current balance was correct
  • The type of account (for example, checking/savings/investment account)

2. Add Transactions

You can add multiple transactions to track how much money is going out of your various accounts and a running total is kept at the bottom to show how much is left from your monthly income. You can schedule future transactions as well as ones that are more imminent. Once transactions have been added, your account balance is altered to reflect how much is really in your account once this money has gone out.

3. Create your budget

There are pre-determined categories that you can use (such as food, housing and insurance), but the interface is completely customizable and you can add your own categories as well.

4. View reports

See your spending patterns at a glance with handy and informative charts. This helps to make your budget look and feel real.

Key Features

  • Because it’s based on money principles and rules, YNAB teaches financial discipline and helps you to manage your money wisely
  • Encourages the building of an emergency fund and living within your means


  • A simple way to track your spending and assess where you can make changes
  • Saves time and effort
  • Installation is simple and quick
  • Can import bank activity to avoid endless typing and this doesn’t involve giving your bank account details to YNAB


  • Doesn’t contain any exciting tools or features, because simplicity is the name of the game and this won’t suit everyone
  • To get the most out of YNAB, you need to have at least one month’s income saved, because the YNAB rules advocate living on last month’s income (not this month’s)
  • At $59.95 for the full version, it’s on the pricier side. However, you can quickly and easily make back the purchase price in savings as a result of using the tool

Final Thoughts

One of my favorite things about using YNAB is its simplicity. If you like your budgeting software to have all the bells and whistles, this probably isn’t right for you. But as someone who wants to keep the budgeting process as simple as possible, it suits my needs perfectly.

If you want to try out YNAB before you buy, you can take a free 7-day trial when you initially download the software from the YNAB website. This is what I did, and I found that week to be enough time to play around with the features and decide whether or not the software was worth upgrading.

Get your budget and finances in order. Download a free 7-day trial of the budgeting software: You Need a Budget (YNAB)

Comments Disclosure: The below responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

  • Alan

    I thought I had my budget under control when I was just using Excel to do my budget, but once I got YNAB I realized that some things were slipping through the cracks. YNAB has been worth the cost!

    Another thing I wanted to mention is that it’s best if you can go it to the YNAB process with a month’s income saved, but if you are living paycheck to paycheck it will help you keep track of the money you have left at the end of the month as a buffer. Once your buffer is equal to your monthly income, you can spend the buffer and allocate your earnings from this month to spend next month so you aren’t living paycheck to paycheck. It may sound a bit quirky but it works!

    • Sally Aquire

      It’s good to hear from someone else who has used YNAB, and I like your buffer advice for having a month’s income saved up – even if it sounds a bit ‘quirky’, it’s definitely sensible!

  • Elizabeth I

    I have tremendous success with excel, so I cannot imagine paying for another budgeting system.

    I do use excel two ways, I have monthly spreadsheets which track every $1. Then I have a different spreadsheets which chart my clothes spending and other categories. There is one total $$ per month, and I can quickly see a snap shot of how much I have spent to date and how much is remaining for the year. This works on the “roll with the punches” concept. I have a set amount of $$$ for a year for a category, I can spend it all in January or all in December or I can choose not to spend the entire amount.

    • Em D

      That’s an interesting way of setting it up. There’s so many things that you don’t buy monthly but may be a significant expense a few times a year (like my weakness, end of season sales). I may have to give this a try.

  • Mac

    I too use YNAB, but am having a tough time letting go of Microsoft Money (awesome tool for balancing accts)…so I put my expenses in both! That’s going to have to change soon, but probably not for another few months…plus I hope that’ll give me some extra time to increase my meager buffer.

  • gina

    I too use Excel to keep track of my expenses. YNAB looks really interesting, and the 7 day trial is enticing, but I do hate to spend money when I can do it on my own!

  • Mac

    If anyone is on the fence about YNAB, you may want to check out their free webinars. They have a few every week and cover different topics on how to use their software. It’s a live session and questions can be asked. Very professional and helpful.

    And in the next month or two they’ll have an iphone app, so trx can be entered as they are incurred. Exciting for those with such a phone!

  • Gilbert

    I’ve been using YNAB for 2.5 years and really love it. It’s a one time cost, no annual renewel. This software is strictly for planning how you will spend your money and not how you spent your money. You have to assign every dollar into a category. Most americans don’t have enough money to worry about buying software to track investments. If you don’t have 3 to 6 months living expenses that can quickly be liquidated, you should not be investing.

    If your lucky enough to have money left over after budgeting all your expenses, then saving for a future expense such as a car is a snap. You simply create another category “New Car” and assign any left over money.

    Not only do you track how you will spend your money, you can track the history of any category and see how much you’ve spent and then budget an avg amount (ie. car maint).

    Since every expense has to be deducted from a category, you will quickly begin changing your spending habits and start saving far more than you thought possible.

    Americans are constantly bombarded with ways to part with their money. Knowing what money is actually available will empowere you to say NO.

  • Jerry

    Hi, Failed at manual spreadsheets. Does anyone have any current budgeting software that uses my bank account activity? YNAB doesn’t fit my needs.
    I hate budgeting but feel I am spending more than making.

  • Nik

    YNAB’s a great tool if your finances are relatively straightforward. I downloaded the trial a few months ago, and I’ve been happily using it since. You could probably set up something along the same lines in Excel and save yourself 60 bucks, but honestly… this program has made dealing with my expenses and budget such a relief. Gilbert’s right- it’s an easy way to see what leftover money you have each month or, conversely, where you should change your spending habits. I don’t exactly stick to my budget per se so I like an easy way to keep track of where my money will be going for the month.

    I wouldn’t buy this if you’re looking for a new toy. It’s too simple for that (but like everyone said, in a good way).

  • Jerry

    Thanks. Found my software and it’s 15 bucks!
    YNAB was too expensive.
    Thanks for the suggestion though.

    • Curious

      what was the software you found?

  • Difwiz

    I believe YNAB has lengthened its free trial to more than 30 days so people can try it for a full month cycle before buying. We have been using it for years and love how easy the budgeting process is.

  • Stefano

    I personally use Buddi, it’s free and available for Win and Mac. The only thing it doesn’t do as compared to YNAB is work strictly by their 4 step method. However, I think the first step is to actually start recording Income, Expenses and what I like to call sundry or misc. expenses that are those items you buy from time to time for anything from $2.00 – $80. We’ve all spent those amounts every now and then, but with a budgeting software if you track every single transaction, after a few months you’ll realize how much those little misc. purchases add up and how big of a whole they can make in your overall budget. I don’t think $60 is too much and YNAB seems to be a profession and legitimate company. However, if you want to go it alone and perhaps use YNAB free seminars and other information available on the net, you could try Buddi, it’s easy to use and if you like it you can send a donation to the author, but it is not compulsory. There is also Gnucash, which is also free, but it is much more elaborate. Anyhow, these are just my $0.02 worth. :)