My husband and I have used a number of budgeting techniques and programs over the years. The one which we used for the longest was a cash envelope system combined with bi-weekly budgeting and an excel spreadsheet. We kept a standard budget on an excel worksheet but because my husband’s income fluctuates we would do another budget up with each paycheque down to the dollar.
This worked fairly well but we kept running into the same issues each month. We were budgeting our money but not tracking our spending which would sometimes cause as to question where the money went. Furthermore, forgetting to take cash with us when going shopping then caused an issue as did keeping a large amount of cash in our home. Becuase we were taking large amounts of cash out every two weeks to divide amongst our 20+ envelopes (everything from food, gas, vehicle maintenance to kids recreation, yearly family pictures, kids school fees etc) we kept a low balance in our chequing account. This would result in constant stress to make sure that payments came in on time so that and that pre-authorized debits such as our mortgage would go through ok.
We had tried software like Mint.com before but I didn’t like how it was connected to our bank account and it didn’t seem to have the categories that we wanted. I started to hear about You Need A Budget (YNAB) early last year however, I was unsure about paying for a software. I spent some time going through their website and reading reviews of the software by people who were actually using it. The reviews seemed to be overwhelmingly positive so last October I downloaded the free trial and we gave it a go.
And I loved it!
YNAB has been the solution to our budgeting concerns. I can now keep money in the bank yet have it all earmarked in the categories that I want. It’s not connected to our bank account which makes me feel more secure. Entering debits, credit and transfers into the software is easy and straightforward. I love the split category option so if I spend from multi categories in a single shopping trip I can accurately record it. I also really like that I can check how much I have left in a category on my phone and know immediately if a purchase will stay within our budget. I can also go back and see just how, where and when the money from each category has been spent.
The charts are helpful to figuring out our spending trends for the month or the year. And the zero-based budget means that every dollar has a job and if you go over in one category you have to take from another. This provides more accountability and prevents overspending for the month.
The principal of living on last months income has been a major stress reliever for me. I no longer have to check the bank account multiple times a week to make sure that the money for pre-authorized bills is available. I know that this not an option for everyone starting out but we decided to take the money from our savings account so that we could start this principal right away. This has also allowed us to better budget my husband’s fluctuating income and has taken a lot of the guess work out of it.
Just like any software or method though YNAB does take work to keep up with. My husband doesn’t have a personal cell phone which means that any time he buys something he brings the receipt home to me and I enter it in. This can grow to be a problem if you don’t keep up with entering information as soon as possible.
At the beginning of this year YNAB had an update and changed it’s payment format. It is no longer a software that you buy one time but a program with a monthly or yearly subscription cost. I was extremely disappointed to learn this. Even though $5 US may seem like a small amount to pay monthly with our low Canadian dollar it equates to more. All money that could be put to better usage elsewhere.
The good news though is that the older versions are still available for purchase (I use YNAB 4). However, there will no longer be any updates to these programs.
Have you tried YNAB? What did you think about it?