YNAB 4 – Should I Or Shouldn’t I

YNAB

stressed womanIf you are searching for budgeting software but are unsure which one to get, let me give you the skinny on YNAB (You Need A Budget) software. Compared to other software packages, YNAB is what you would call a “living” budget instead of a “static” budget. In other words, instead of just helping you budget the funds you have now, YNAB also helps you manage future spending and learn to save for unexpected expenses and eventually achieve the level where you are living off last month’s income. That is real budgeting power! Another great point is that the mobile apps are now offered free for their customers and for those trying out YNAB in the trial version.

But in all fairness, there is no such thing as a perfect system. There are pros and cons with YNAB as with anything else. With that in mind, here are some of the benefits and drawbacks for this software.

Benefits

v  YNAB will actually teach you how to budget very effectively as you use it.

v  A strong support with options for getting help right away, including online classes and an active user forum help you get going quickly and stay the course.

v  They offer a free 34 day trial.

v  YNAB keeps you very close to your spending so you know where your money goes because you have to “give every dollar a job”, that is, assign a category to all spending.

v  This budgeting software prepares you to eventually live on last month’s income.

v  The iPhone, Android and Kindle apps let you enter transactions and check your budget on your mobile device – and now they are free!

Drawbacks

v  YNAB 4 does not do automatic transaction downloads. You must use the online banking site for each financial institution to download transactions. However, YNAB does a great job of importing those transactions.

v  If you need features like investment support, financial planners for college, retirement or other life events, or advanced debt reduction planning, you may need to get extra help. However, the YNAB team is always trying to keep up with their customer’s needs so you might check their blogging website to view the latest articles that may help with these matters.

v  Can be slow to load when you first start it up and when moving between the Budget, Reports, and Accounts sections of the software.

The drawbacks are very minimal compared to what you get with the software. I personally think YNAB is one of the best budgeting packages out there. If you are considering budgeting software, give them a chance to impress you with YNAB4 – you won’t be disappointed.

The Methodology of YNAB- What Is The Difference

YNAB

ynab reviewsThere is a lot of budgeting software on the market. They all boast how their software will help you get back from living paycheck to paycheck. Many have a lot of bells and whistles which look impressive but really don’t do much for the average person just looking to budget the income to pay the outgo.

YNAB is budgeting software that does just one thing; budgeting – and does it well. It has a lot of features to help you stay on your budget and new features are being added all the time. The main difference between YNAB and other software packages is its methodology. The creators of YNAB produced a product that actually helps people stop over-spending, start saving, and build up excess income that eventually provides a buffer system of one month’s income in advance. That is software with a purpose!

YNAB’s Methodology

The methodology of YNAB resembles the old envelope budgeting system. Instead of setting aside money into actual envelops, you use virtual “categories” that you assign your income dollars. Of course, there is more to it than that. The crux behind YNAB methodology is based on four rules.

  • Rule 1: Give Every Dollar a Job – Instead of deciding to buy something based on the big (or small) pile of money in your checking account balance, you’ll decide based on a category balance. By using categories, your hard-earned dollars are divided up into the amounts needs to pay in-coming bills. Extra funds are distributed into extra categories like entertainment or mad money.
  • Rule 2: Save For a Rainy Day – By using rule 2, you to look at the larger, less-frequent expenses (car insurance, life insurance, Christmas) and break them down into monthly, manageable amounts. Then you budget for them over time with no worries. This gives peace of mind.
  • Rule 3: Roll With the Punches – Be flexible and address over-spending before moving on to the next month. Rule 3 helps you do this. If you overspend in a category, look through your budget and move some money around. However, remember that the goal is to stay on budget. If you get off budget, reality sets in.
  • Rule 4: Live on Last Month’s Income – To be perfectly frank, YNAB wants you spending this month bills with what you earned last month. This rule is something to strive for, and likely isn’t something you can implement right away. However, with the help of the other three rules, you will eventually get there.

YNAB’s methodology is the key that makes this software ahead of the others. Check it out and see for yourself.

 

The Difference Between YNAB And Quicken

YNAB

home budget softwareThere are many people who use YNAB and there are those who use Quicken for their budgeting needs. You might say “so what is the difference? Isn’t all budgeting software about the same overall?” While there are definitely some areas where all budgeting software is alike, there are differences in each program that may appeal to different people. Those who are not really literate in the computer field may find one more usable than another.

However, the one main difference between YNAB and Quicken is that Quicken helps you know where your money went while YNAB helps you know where your money is going to go. One is based on what happened in the past, the other is based on what will happen in the future.

Quicken

Quicken is a full-fledged personal finance package. Its reporting features are excellent and it will track numerous types of financial transactions. Its weakness is in its budgeting and spending planner. The problems are some bugs in the program as well as that by default, things are too hard in Quicken. However, with a LOT of work, you can set up a near approximate zero-based budget like what YNAB uses. But the bugs are still there in the program and you can’t enter certain things as a negative in order to make this type of budget work. However, Quicken is great for investments and gives out nice reports.

YNAB

YNAB does one thing – budgets and planning and it does it extremely well. It be used to reconcile a checkbook and it can be used to get some level of expense reporting. But does it have the strong reports, graphs and options that Quicken has. Also, it won’t handle investments or transactions like that. But if you are looking for budgeting software, no other comes close to the ease of YNAB. You don’t have the bug issues for a budget that you do with Quicken, and even the methodology is easier to understand and appreciate.

The four rules of YNAB are valuable tools for anyone to use in budgeting. They provide goals, methods to achieve those goals, and tips to help you change your way to thinking when it comes to budgeting. They offer great support and have tutorials and forums to help with questions.

However, for many people, both packages have their place and many people use both Quicken and YNAB for their financial needs. But the bottom line, YNAB is definitely the winner if you are looking for ease and success in your budgeting strategy.

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