YNAB stands for You Need a Budget. It is a software package that acts as a management console for your finances. And it’s awesome.
You can download a trial here.
The usual software costs $60, but you can get a discounted (secure) steam key for $29 here.
Principle 1: Every euro/dollar needs a job
YNAB divides your financial life in categories (which you can define yourself). When new money comes in, you are expected to give every but of it a job, for example:
- 30 euros will be “phone cost euros”
- 200 euros will be “food euros”
- 400 euros will be “savings euros”
By giving money a job like this, you will be far less likely to spend money without having budgeted for it. Personally I for example have categories for:
- Toys (technology/upgrades)
- Guilt free money (monthly ‘whatever I want’ budget)
- Getaway find (saving up for holidays)
Principle 2: you don’t need to be obsessed with budgeting
The people who made YNAB (and the free course that comes with it) understand one important thing: you are human.
You want to live life, and not think about money all day. This is fine.
YNAB is made so that it can function on half an hour a month of budgeting. Because you make this plan for the month, you don’t need to think about the purchases you make. And when in doubt, you just check your budget. For example through their mobile app.
Principle 3: Live off of last month’s paycheck
This is really powerful and has changed many peoples lives. Many people have too little in their bank account to survive the next month if their salary doesn’t come in (or comes in late).
The YNAB intro course gives you s strategy to start giving off of last month’s income. The psychological freedom of this is really powerful.
Basically what YNAB sells is not just a piece of software. They give you the tools to live your life without any money anxiety. And that is definitely worth 30 of your euros.