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You Need a Budget Review

by Ryan Guina

You Need a Budget, also affectionately known as YNAB, is one of the leading budgeting tools. I was recently given the opportunity to try the You Need a Budget budgeting software program, and let me tell you – I am impressed! YNAB is incredibly easy to use, powerful, and accurate.

What YNAB is and is not

You Need a Budget is a budgeting software program that will help you manage your money and cash flow. It uses a zero based budgeting system, which means budgeting every dollar of income that you receive. That doesn’t mean you need to spend all your money, it just means you need to give every dollar a job. If you have money left over at the end of the month, you can use it to pay down debt, apply it to your emergency fund, save it for a long term goal like a vacation, or anything else you want to do – you just need to give it a job.

You Need a Budget is not a full money management program like Quicken or MS Money. YNAB is great for setting budgets, tracking expenses, setting goals, and understanding where your money goes, but it is not designed for advanced money management like tracking investments, managing small business expenses, or detailing your rental property information, like some versions of Quicken are designed to do. But that’s OK, these software programs are designed for different demographics and one or the other may be perfect for your situation, while the other just isn’t right.

The YNAB Methodology

You Need a Budget simplifies budgeting down to a simple 4 step process:

  1. Stop living paycheck to paycheck
  2. Give every dollar a job
  3. Prepare for rain
  4. Roll with the punches

These four principles are all you need to get your financial house in order. The first step, stop living paycheck to paycheck, is one of the most important steps you can take. This is similar to what Dave Ramsey advocates in his 7 Baby Steps. The most important thing to do is to get current on your bills, then start getting ahead.

In the second step, Give every dollar a job, YNAB users are instructed to use each dollar of income. As I mentioned earlier, that could mean spending it, saving it, paying down debt, or something else. Just make it productive.

Step three, Prepare for Rain, is designed to spread out large, occasional expenses which can be anticipated. An example of this would be saving for your property taxes, a new set of tires, or an annual insurance payment. You know these expenses are coming, and they are much more manageable if you save a few dollars here and there instead of trying to make a huge payment all at once.

Finally, you’ve got to roll with the punches. Life does not always follow a script, and to pretend that you can prepare for every expense that will come your way is paramount to setting a date with disappointment. It can be as simple as spending too much on groceries, or it can be an unexpected expense such as a flat tire. Whatever the unexpected sends your way, you need a way to deal with it. Step Four is a way to pay yourself back for unexpected expenses and replenish your emergency fund or other savings.

You Need a Budget Software Options: YNAB and YNAB Pro

You Need a Budget offers two versions of its software – a standard version, YNAB, and YNAB Pro, a more advanced version. Both of these software programs follow the same methodology and offer a lot of value to users. Here is a little more information about the two versions:

YNAB. The standard version of YNAB is a spreadsheet based budgeting system that is compatible with Excel (Windows or Mac), Open Office, or Neo Office (Mac). YNAB is very capable and automates many of the functions in the spreadsheets to make your job much easier and more efficient than creating your own spreadsheet based budget. The biggest downfall is a lot of manual data entry. Thankfully, YNAB Pro eliminates most of those problems.

YNAB Price: $24.95 Buy it now!

Save 10% with coupon code: cashmoneylife

ynab-proYNAB Pro. YNAB Pro is the big brother to YNAB, and offers users much more in terms of automation and flexibility. It allows users to import information from their bank, set up recurring expenses, offers unlimited user created categories, a variety of charts, graphs, and other reports, and more. The biggest advantage to YNAB pro is the automation – it eliminates much of the repetitive data entry. The biggest downfall to YNAB Pro is that it is not currently available for Macs, though you can run it on an emulator (YNAB 3 will be compatible with Macs – see below).

YNAB Pro Price: $49.95 Buy it now!

Save 10% with coupon code: cashmoneylife

Introducing YNAB 3 – now compatible with Macs

YNAB 3 is the next generation of You Need a Budget Software, which is being developed on the Adobe AIR platform, which means the same program is compatible with Windows and Macs! The new YNAB software will allow you to seamlessly import your data from previous versions of YNAB. YNAB 3 will also include updated features, including enhanced reporting, register searches, customizable fields, budgeting accounts vs. other accounts, and more. Overall it is a much more flexible version of You Need a Budget. Look for its release in mid – 2009.

You Need a Budget FREE Bonus Software

Right now, YNAB is offering 5 FREE bonus spreadsheets to people who purchase YNAB or YNAB Pro. The free spreadsheets cover a variety of personal finance topics and are a great value! The free bonus software includes:

  • YNAB Debt Snowball. The debt snowball is a concept made popular by Dave Ramsey. This is a quick and proven way to get out of debt quickly.
  • 2009 Income tax forecaster. This is a great tool to help you predetermine your income taxes for next year.
  • YNAB Retirement Planner. The YNAB Retirement Planner spreadsheet can help you make investment decisions that will help you meet your retirement goals. You can also do “what-if” scenarios to investigate different investment and retirement options.
  • YNAB Mortgage Analyzer. This will help you determine how long it will take to pay off your mortgage, and you can change the variables to see how much more quickly you can pay it off by refinancing to a lower rate or making additional payments.
  • YNAB Car Maintenance Schedule. This will help you keep track of all your scheduled maintenance such as oil changes, tire rotations, filter changes, and other scheduled maintenance actions. A well-maintained vehicle can save you thousands of dollars and last years longer than a car that hasn’t been well maintained.

In my opinion the bonus software alone is worth the cost of the standard version of YNAB. $24.94 for 6 professionally built financial spreadsheets is a great deal. YNAB Pro is an even better deal because it automates much of the process for you, making your job easier in the long run.

Using YNAB Pro

Setting up YNAB Pro was quick and easy. The first step is to register your expenses in your YNAB software, or import a spreadsheet from YNAB. Be sure to enter this information accurately, or you will be cheating yourself and the software won’t have the correct information to work with.

The next step is to set up your bank account information if you want to link your data. Since this program runs on your desktop, there is no danger of your information going anywhere. Once you set up your basic budget, it is easy to import information from your banks, schedule payments and tasks, create charts, graphs, and other reports, and organize your finances.

YNAB Support

One of the things that most impressed me about YNAB is the level of support they offer.  YNAB offers online tutorials, a wiki, a user forum, an online user manual, a FAQ section, and even FREE online coaching via webinars. YNAB is passionate about budgeting!

Free YNAB trial and a 60 day guarantee

YNAB is so sure of their product that they offer a 60 day free trial version of YNAB Pro and they also offer a 60 day money back guarantee. That’s not an offer you would get from Quicken or MS Money!

YNAB Coupon Code – save 10% on YNAB and YNAB Pro!

The folks over at YNAB were kind enough to offer Cash Money Life readers a 10% off coupon code for both YNAB and YNAB Pro. All you need to do to take advantage of this special offer is to visit the YNAB website and enter in the coupon code “cashmoneylife“.

This coupon code is only good for 3 days, and expires at midnight on March 5, 2009. So act quickly to take advantage of this great offer!


Published or updated May 18, 2011.
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{ 8 comments… read them below or add one }

1 Kristen

Ryan, your post is helping to save my morning!! I was out of the office yesterday. I have to do a TV interview in an hour about budgeting at home, and they want to know about software. This is a perfect product to mention, and I wasn’t aware of it until right now. Thank you!

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2 Ryan

Excellent! Good luck on the tv interview! :)

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3 Neal Frankle

Thanks Ryan.

Would you recommend this over Quicken? If so, why?

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4 Jesse

Hi Kristen,
I’m the owner of YouNeedABudget.com — you certainly piqued my interest about mentioning it on a TV interview! I’d love to get in touch with you and find out how it went.

Also Ryan, thanks for the great review!

And to Neal, I would recommend it over Quicken ;) It’s a different approach to your money, focused much more on activities that deliver results, instead of activities that are done for their own sake… I’d encourage you to take the 10-day course and give it a test drive!

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5 Sandra Kristjanson

It looks like a great program. Sign me up for the giveaway. Thanks

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6 Jason Unger

I think the biggest step you can take when budgeting is realizing that every penny has a purpose.

When you’re able to track all the money that comes in and all the money that comes out, you can get that zero-based system where all your money is doing something.

Great review.

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7 Ryan

Neil: I wrote an article as a follow-up to the e-mail I sent you in response to your question: Battle of the Money Management Tools: Comparing YNAB Pro and Quicken.

The quick and dirty answer is that it depends on your needs. I know that doesn’t tell you much, so go check out the article! :)

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8 Save Money Hound

I am also interested to hear about the difference between YNAB Pro and Quicken. Thanks for the link Ryan.

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