You really do need a budget
Just in case you missed my post from yesterday…I don’t want this to feel like an ad, so I’ll tell you that while I’m going through this series, some of the links will have referral bonuses (usually for both of us). I’m not being paid to write any of these reviews, and their selection was purely based on my own criteria (stuff I think is awesome). I hope you like them!
Today’s post is about my budgeting software!
You Need A Budget
Two and a half years ago, I started keeping track of all of my spending. I used an app and a spreadsheet to track everything I spent, and was able to cut back in areas where I was overspending. I’ve also been using a checking account app for years to keep track of my bank account balances. I got really good at all the tracking, but I wasn’t great about actually creating or sticking to a budget. I usually would write out all of my bills, then when it came to my other expenses, like gas and food, I just pulled from what was leftover. It was hard to make good decisions in the moment whether we could afford to do something or not, just looking at that one bigger number. In April, I discovered You Need A Budget (YNAB) and it’s replaced all of my systems, as well as helped me keep track of and actually stick to a budget.
YNAB isn’t really just a software, they have a lot of training and a whole system built around four rules. One of their rules is that every dollar has a place. When you get paid, that money goes right into an amount called “To Be Budgeted.” You create categories as detailed or general as you want (for instance, you can have a category for food, or split that into two categories called groceries and dining out). Then you take the money in your to be budgeted category and put every penny into a category. For instance, when I get paid I might put money into my rent category, daycare, bills, groceries, dining out, ect. Then every penny is accounted for, and I know exactly how much I have to spend in each category.
If you overspend in one category, you have to pull funds from another. I find this method super effective, because I’m not looking very often at the big number in my bank account, I’m looking at a specific category to see if we can afford to eat out. If we have $12.30 in dining out, I know it’s probably going to be burgers over sushi. If I do overspend, I have to pull money out of our vacation fund, so I’m less likely to do it.
If you don’t spend all of the money in the account for that month, it rolls over. You can set spending goals, so if you know you need $100 for an expense in February, it will divide up how much you need to save per month until then and keep track of how much you’ve put back. This has helped me move a lot of things over to annual payments and save money. I can also keep up with big expenses by building up mini emergency funds. I can put a certain amount in a car repair fund each month and forget about it. When the car breaks down, I’m ready for it. I won’t get into every detail, because they explain it all way better on their website, but the software is set up to help you prepare for all kinds of scenarios.
I think this software would also work great to help couples stay on the same page with their spending and goals. There is even an Alexa skill that allows you to check how much money you have left to spend in any category. I’ve been using this to help Cash track his spending money. All he has to do is ask “Alexa, how much money is in Cash’s allowance?” and she’ll tell him his running balance.
I love this software for a few reasons. For one, it’s the whole package. I never thought I’d give up my trusty checkbook app, or the budgeting spreadsheet I’ve been using for 5 years, but the truth is this software took what I was already doing and did it better. Also, the concept of budgeting every penny into a category really works for me, psychologically. Their help section and FAQ is one of the best I’ve ever seen. They take something that can feel very overwhelming (and often emotional) and break it down with fun graphics and great copy. They also have a blog that you can go to for tips and inspiration.
They regularly update their software (with release notes), and their app works great. This is really important to me, as I use my money apps every single day. They also keep track of your spending and create some awesome reports about your trends over time, which is really helpful data to track.
If you’re interested in trying it out, they offer a full month trial. They only take annual payments ($84), but that includes full use of the website and the app. Plus, as I mentioned above, I’m getting to be a fan of annual payments. They save you time and money, and YNAB makes it easy to budget them in.
If you’re interested in a free trial, you can use my link here, and I’ll get a month free if you sign up. Let me know what you think!