Archive for September, 2012

September 28th, 2012

The Secrets Behind YNAB

ynabYNAB is a leading personal financial software budgeting tool that helps people to develop a proactive plan which will ultimately pull them out of the drudgery of living paycheck to paycheck.  And this personal budgeting tool, named for the acronym of “You Need A Budget” (YNAB) is claiming exactly that is happening for those who use their tool.

What’s even more incredible is that these financial improvements are taking place while YNAB users are reporting they are spending less time managing their money.

The YNAB claims make it worth a closer look.  What exactly are they doing that can make this possible?  A deeper dive reveals the core difference; YNAB uses a “buffer” fund.  This fund is made up of savings that is equal to a month’s worth of personal expenses.

The concept is actually genius.  YNAB turn people’s focus towards employing each dollar to do what is most important for that dollar to do instead of just asking “do I have enough?”  The mentality causes a fundamental change in the mind.  The concept is significant enough that the software company reports that after using YNAB for one month, median increase in net worth is $200.  YNAB reports that after 9 months, that number increases to $3,300.  That is compelling.  Maybe there is something to the YNAB belief that the old school approach of living off estimated income is what is holding people back from realizing their financial goals.

Don’t currently have savings equal to one month in expenses?  No problem.  YNAB helps you get there.

YNABDoes it sound too good to be true?  Perhaps it does.  But YNAB has a 4 step methodology to show the way, and it accounts for the very common and very human behavior of over spending (see Rule 3).

•    Rule One: Give Every Dollar a Job (Change your mindset)
•    Rule Two: Save for a Rainy Day (Plan for the unexpected)
•    Rule Three: Roll with the Punches (Reality check)
•    Rule Four: Live on Last Month’s Income (Final state)

It is nice to discover YNAB’s claims are backed by a legitimate plan.  Still, does it really work?  What about one of the over 100 other budgeting tools out there?  Is YNAB the one to use?

Thank you information age.  Go check out to find one of the few places that documents an in-depth review (beyond the standard 1 or 2 paragraphs).  It’s a good spot to see how YNAB stacks up.  Also, find out what actual YNAB users think by interacting with them YNAB’s forum located on their site.

With the sort of results that YNAB is claiming can be yours, you’d be crazy not to.