Like most people, I’ve struggled with finances my entire life. I always felt behind, trying to make ends meet. But I can tell you now, that’s all changed! Let me introduce you to the best budgeting app out there: You Need a Budget (YNAB). It single-handedly helped me stop living paycheck-to-paycheck. Now I’m on top of my finances, my stress level is way down, and I’ve started saving for the things I want in life. I cannot recommend it enough!
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Aren’t there a bunch of budgeting apps out there?
Yes, there are a ton of available options. I’ve tried lots of them. What I’ve found is that most of these apps are reactive. You categorize transactions after they occur, so you can see how you’re generally spending your money.
And though this did help me realize that I spend way too much money on energy drinks, I still found myself doing a lot of financial planning in my head and never really saw improvement in my financial situation. I still had bills that surprised me and spent a lot of energy mentally “setting aside” money for things like rent and groceries.
How is YNAB different?
Turns out, that’s the key! YNAB is different because you’re proactive about your finances, instead of reactive. When you get a paycheck, you immediately assign every dollar a job. You move $200 from that paycheck into your Rent category, you give it the job of “Rent”. If you do that out of every weekly paycheck, then you’ll have you $800 in rent set aside when rent is due at the end of the month.
And it gets better! You set the categories. So you have your classics like Rent, Groceries, Phone Bill, Dining Out, but I also have categories like Homestead Supplies, Chickens, Hunting, and YNAB. Yes, I have a category to set aside money for my yearly YNAB subscription. At just $2 per week, I have the money saved up long before it’s due! Granted you don’t have to worry about that just yet because you can start with a free trial here, but let me sell you on it a little more…
Payday with YNAB
Here’s what payday looks like for me with YNAB. I’m going to skip some of the more technical aspects of how the program works. They have wonderful tutorials on their website.
Every payday, or anytime I receive money in my account really, I go into YNAB to give each dollar a job. I first look at upcoming bills. If that bill is coming before my next paycheck, then I make sure to assign enough money to cover it. I do this all the way down the line, for all upcoming bills.
After that, I look at some of the regular expenditures that aren’t necessarily bills.
- Am I going to fill my transit card this paycheck?
- Are we getting groceries this paycheck?
- Will I need to fill my gas tank?
- Will I need to eat out for lunch or dinner?
This is the kind of planning that really helps you realize where you do and don’t have money to spend. Maybe I will need to fill my gas tank this week, so that means I don’t have money to budget for dining out. Before YNAB, these kinds of situations would surprise me! I’d eat out and then realize later in the week that I needed to fill my gas tank, but the money wouldn’t be there. By thinking ahead, you can responsibly plan your finances.
Once you’ve covered your bills and other upcoming non-bill expenses, the pool of money you’re left with is your wiggle room. The key here is to keeping assign every last dollar a job.
Here’s where I might add money to my Gift category because saving a little bit out of each paycheck means I’ll have enough money set aside come Christmas. Plus, I can’t tell you how nice it’s been to have that money ready for surprise birthday gifts. It becomes guilt-free, instead of scrambling to find the money.
You might also add some money to your Auto Maintenance category because those expenses do pop up from time to time. I also set aside a little money from each paycheck for hunting season, my retirement, and supplies to build a chicken coop…to name a few.
If you really do need a little pool of money for unforeseen expenditures, they do recommend a Stuff I Forgot to Budget For category. Though you should keep this small and really work on planning ahead. Give every dollar a job.
The Flexibility to Adapt
So, say you’ve assigned every dollar a job. You’re mid-paycheck cycle and you spent more than you were supposed to on groceries or you had a spontaneous night out with friends. You didn’t have that money set aside, so what do you do?
Well, that money is already gone. It’s spent and out the door, but it has to come from somewhere. I would first use anything you have in the Stuff I Forgot to Budget For category. If that’s not enough, you’ll have to start pulling from other categories.
Say you have $300 set aside for gifts, but no big gift expenses coming for months. Maybe you can afford to siphon off $40 to pay for the extra groceries?
Here’s where you prioritize what’s important. We are building our chicken coop very soon, so I’m not willing to move any money out of that category. However, I’m very willing to reallocate money from our Dining Out category to cover other unforeseen expenses. That just means won’t eat out this week. We’re all human and stuff like that happens, but having the ability to adapt and move my finances around has really taken an incredible weight off my shoulders.
You Really Won’t Regret It!
Budgeting is now fun instead of terrifying. I can buy things with confidence, knowing that the money is there. Also, I can’t tell you the last time my bank account was anywhere near zero!
It’s an incredible feeling, being on top of your finances. YNAB was highly recommended to me by my family. It changed their financial situations too! I’ve recently gotten Jerry started with YNAB and he loves it! As a small business owner, it’s powerful for him in planning business expenses and setting aside taxes.
Give it a Try!
Hopefully, I’ve convinced you enough that YNAB is worth a try! Using my referral link will start you with a 34-day free trial. Stick with it! I found the concepts a little challenging to wrap my head around in the beginning. It’s a new way to think about budgeting, so it takes a little time. You’ll get the hang of it!
If you love it as much as I do, sign up for their yearly subscription at $83.99/year. Budgeting just $7 a month will get you there!
If you do subscribe to their yearly service using any of the links on this page, we’ll both receive one month free!
I really can’t recommend YNAB enough! It’s an incredible budgeting app that, no joke, has changed my life. Do yourself a favor and give it a try today.