I’m using YNAB and I’m determined to succeed!

Rick & I are going to actually manage our money this year, instead of letting it abuse us. There’s no reason we should be struggling like we are. The money’s there, it’s just draining away with no set course. 2013 is the year we are going to get back in control!

I’ve had plans to fix things before, and none of them have worked. I’ve tried different programs & systems and either haven’t been able to get them to work, or haven’t been able to actually stick to them. My last failure was Mint.com. It seemed like the perfect solution on the surface. You can link your bank account to automatically import your transactions in real time. You can tell it which category to put certain expenditures into. You can access it from both Mac & PC, as well as mobile. It is free. Well, after a year of mostly ignoring our finances because Mint was doing all the work (even though it really wasn’t) I sat down to give it another shot. I decided that since we had a full year of transactions in Mint categorized that I could look at our actual expenses to build a budget. It seemed so obvious to me that a program that tracked all your money in and out could just generate a simple budget sheet for the year. Even just a list, something like You spent $xx.xx in Category A, You spent $xx.xx in Category B, etc. but if Mint can do that it’s not intuitive to find it. And I couldn’t find anyplace to tell it to automatically fill in a budget with those numbers so I could then start evaluating and tweaking our spending. I wanted to add some categories to the budget, but I found that Mint doesn’t allow you to modify the master categories at all, you can only add and subtract sub-categories. I was getting frustrated because I knew we needed a budget, but I’ve never actually sat down and done one. This program that people are always saying is awesome should be able to help me!

So, I turned to the place that knows everything, Google. One program kept turning up in articles I would read: You Need A Budget (YNAB.) I went to the site to check it out and almost left right away because the software costs $60. I couldn’t imagine paying $60 for a program that probably wouldn’t work. And of course it wouldn’t work for us, nothing else ever had! But it had a free trial, and the site looked like it had some good advice, so I downloaded it. I’m only 9 days into the 34 day trial and I’m already sold!

This is going to be more work than the “Use Mint and ignore it” method, but it should do something that one didn’t – WORK!

Here are some of the things I love about it already:

~ The trial period is 34 days! I love that it’s 34 instead of the standard 30. This way I can not only take the time to see if I like it, but no matter what day I start the program on I’ll be guaranteed one month to month transition before the trial runs out.
~ They write everything in simple straight-forward language because the goal is to make it as usable and understandable as possible.
~ YNAB is focused on deciding where to spend your money BEFORE you spend it, rather than focusing on where it went.
~ There is a free ebook you can read online that lays out the basics of YNAB.
~ It may be $60 to purchase it, but that is for the license. I’ll be able to use it on my Mac & my iPhone, and Rick will be able to put it on his PC and his Android phone. They all sync with each other in real time using Dropbox.
~ You have to either manually enter all your transactions, or download them from your bank in .QFX format and import them. It doesn’t fill itself automatically like Mint does. ┬áThis seems like it would be a strike against the program, but I’ll tell you why it’s a good thing for me in a minute.
~ There are only 4 basic rules for the system, and if I can implement them we will be able to build up a financial buffer for emergencies. 1. Give every dollar a job. 2. Save for a rainy day. 3. Roll with the punches 4. Live on last month’s income.

It’s going to be tough, but if we can do the system and stick with it we’ll see a world of improvement in our finances and how they’re handled. And this looks like it’s a system I’ll be able to stick with.

One of the things I read on the YNAB site was about the reason they force you to manually enter your data: “Manually entering your data keeps you close to your money and leads to a much greater awareness. Awareness is your greatest ally when it comes to money management… Importing transactions is quick and it serves as a great way to make sure that you didn’t miss anything. However, because of its ease, it does remove you from your money to some degree and that can impact awareness negatively.”

As soon as I read that it just clicked that everything I’d been doing the last few years had been distancing me from my finances and the last time I had a really strong grasp of both our income and our expenses was way back when I was manually entering every transaction into the register and physically producing checks for the payments. I want that security of knowing my bills are getting paid back.

2013 is a new year, and I may not make New Year Resolutions, but it’s time for change and this will be my year!