I tend to resist budgeting apps and software (especially after my EveryDollar experience) because I’m a bit of an Excel nerd and a control freak. I have this intense need to account for every penny and I literally can’t sleep at night otherwise!
Needless to say, I’m a budgeting spreadsheet convert and have been for at least 15 years now (ever since my mom taught me how to budget!).
But so many people recommend YNAB (You Need a Budget) that I knew I had to try it! Just so I could say my spreadsheet was better. 😂
Confession: It wasn’t love at first sight.
(I know, that’s not how you expected this You Need a Budget review to go, right?)
It actually took me a couple weeks to totally understand the system because I was trying to jam my years of one budgeting mindset into the YNAB software, instead of letting the app work for me.
But once I stopped micromanaging everything and pretended I was a new user who had never budgeted before, it suddenly made perfect sense.
And the best part is that YNAB allows Joseph to team up with me in managing our finances—and with very little maintenance for either of us! Shared budget app for the win!
Now I’m 10 months into using it and I can’t recommend it enough. Truly! I’ve said goodbye to my spreadsheet for good, which (even with its spiffy formulas and all) only made me work harder, not smarter.
If you want to get your spouse excited about budgeting and turn managing your finances into less of a chore, YNAB might be exactly what you need to shake things up in the best way possible.
Let’s dive into how it works!
The Best Shared Budget App: YNAB
What it is: You Need a Budget is an online budgeting software accessible from both your desktop and via an app on your mobile device (and your spouse’s!). You can easily connect your bank accounts and credit cards, and the software will import your transactions automatically.
Cost: An annual subscription rings in at $84/year. But don’t click away just yet! While this sounds a little pricey (it made me hesitate, too), YNAB is less expensive than the pro version of EveryDollar…and WAY better than even the free Mint!
Think of it like this: At around $7/month, YNAB costs less than a monthly Netflix subscription. So for the same price you shell out each month to be able to sit on the couch binge-watching the latest series (no judgment here!), you can take charge of your money and put your earnings toward things and experiences that you truly value.
How to Set Up Your YNAB Account
When you sign into YNAB for the first time, it’s easy to get overwhelmed with all the options! But don’t stress. The following three-step process will get you and your spouse up and running in under 30 minutes.
Create/edit budget categories according to the structure that works for you. You can have both main categories and sub-categories based on how detailed you want to organize everything. Yay!
I have mine sorted into:
- Monthly Bills (expenses that come due every month, like utilities and our self-pay Health Insurance)
- Living Expenses (Groceries, Pet Care, Eating Out, Gas, etc)
- Sinking Funds (Savings like Fun Stuff, Home Maintenance, etc.)
- Quarterly & Annual Expenses (subscriptions and memberships, etc.)
Pro Tip: I always recommend you start with as few categories to maintain as possible. Otherwise, you can get lost in the details and focus more on the setup versus maintaining the actual budget. You can always add more categories later if needed.
Plus, there’s a “Stuff You Forgot to Budget For” category that comes in handy too. 😉
Connect your bank accounts and credit cards (it might take a couple of days for all transactions to import). Every dollar in your bank account should be automatically added to the “To Be Budgeted” Category. You’ll distribute this money to all of your budget categories until you are left with $0.00 to assign.
This is one of the things I love most about YNAB. You don’t budget based on what you expect to receive; you budget with the money you have…right now. This structure forces you to be realistic and gives you a real-time look at your finances.
Lost? If you’re not sure how to create a budget, what categories to use, or how much money to assign to each category, bookmark my Budgeting 101 series for an in-depth overview.
As you spend money, each transaction will import into YNAB automatically based on the account you use to pay for it: Checking Account, Credit Card, etc.
Again, this usually takes a day or two, but if you or your spouse want to stay on top of everything in real time, you can track expenses as you spend by adding them into YNAB yourself. The software will then catch the “duplicates” by syncing your bank account transactions to the one you added; all you have to do is approve it.
You can even split a transaction among multiple categories if you want!
Here’s an example of the account register for my Chase Credit Card:
Going forward, any time you receive income—from your paycheck, birthday money, or odd jobs here and there—you’ll add it to the “To Be Budgeted” portion of your budget and deposit the money into any category you want.
Weekly and Monthly Maintenance
With everything being so automated inside a shared budget app, it’s easy to just “set it and forget it.” But you still have to stay on top of everything to be successful financially, which means checking in on a regular basis.
Thankfully, YNAB makes the process much less time-consuming!
Choose a day of the week to update YNAB. I do this every Friday. I’ll approve transactions that have come in, assign other transactions if needed, and distribute any deposits we’ve made into our account.
When you transition to a new month, there are a few things to keep in mind.
1. Categories that still have money in them roll over to the next month. You can zero out those categories and start over or let them build. I usually zero out my Living Expenses and transfer that money into savings (which inspires me to spend less in those areas!). But we let our Sinking Funds build over time.
2. Categories where you’ve overspent turn one of two colors: Orange OR Red.
The credit card payment “holding” account is actually my FAVORITE feature of YNAB. I’ve always been a proponent of responsible credit card use. Part of that mentality is treating your card like cash and YNAB makes this super easy to do!
However, when you go over budget using a credit card, you MUST find money elsewhere and add it to your credit card account before the month rolls over. Otherwise, YNAB will just reset your negative account to zero, but leave your credit card payment account lacking the right funds.
This is the one part I don’t like. I did not realize YNAB did this for a few months and wondered why my credit card accounts never matched the money YNAB sets aside for payment. Yikes!
RED: If you overspend in a category using a debit card, the color of your negative balance will turn red. If left untouched, the balance will roll over as negative to the next month and also show negative in your “To Be Budgeted” category until you take care of it.
Bottom line: You must take care of all negative accounts before transitioning to a new month. But the best part is you can cover any overspending with a click of a button: the Inflow button.
3. Lastly, reconcile your accounts every so often to make sure you’re not missing a transaction anywhere. While YNAB does a great job at importing everything, sometimes there is human error too (like if you add a transaction to a wrong account…ahem).
Pros & Cons:
As with everything, there are always pros and cons to consider.
Pros of You Need a Budget:
- Assigning categories is FUN (no math, no manual transaction tracking and no searching for $.10 because of a calculation error!)
- Accessible anywhere with the mobile app
- Allows you to treat your credit card like cash
- Automates budgeting so you (and your spouse!) always know where you are financially
Cons of You Need a Budget:
- Sometimes the bank and credit cards will disconnect and you need to reconnect them.
- Transactions can take 2-3 days to process (so if you’re on a really strict budget, put it in right away and then transaction duplication will turn on).
- The cost. It may seem cliche to say it pays for itself, and the truth is, it may not if you’re already a seasoned budgeter. But it’s super convenient! And if you and your spouse are brand new to budgeting, the ease of learning to use YNAB means you won’t ever have to try another budgeting tool.
With You Need a Budget, I not only know where every penny is going, but instead of dreading the day when I need to update my spreadsheet with weekly purchases, I actually look forward to opening up the app and assigning all the transactions that come in…automatically.
It’s one of my favorite things now. I never EVER miss a transaction!
Joseph is especially grateful, because there were always a few receipts of his missing from our Receipt Jar. Now he just has to tell me what he spent the money on or he can enter it in himself. This makes YNAB the perfect shared budget app between couples.
You’ll be more conscious about your spending. Overspent categories turn red or orange (ick!), but when you see green (aka positive balances!) while scrolling through the app, it will inspire you to come in under budget every time.
I especially love transferring that extra money elsewhere, (like our Rize Savings Account) to fund our financial goals.
One last reminder: To make YNAB work, you must get rid of all other budgeting mindsets and approach this method with an open mind. But once you start, I promise you’ll be hooked! YNAB has the potential to change the way you view your finances forever.
And who knows? You might just find you become a budgeting nerd like me. 🤓
Let’s chat about budgeting apps:
Have you ever tried a budgeting app before? Do you have any questions about how YNAB works or anything I need to clarify further to help you make the best decision for your finances?
Disclosure: Some of the links in the post above are affiliate links. This means if you click on the link and purchase the item, I will receive an affiliate commission. Regardless, I only recommend products or services I use personally and believe will add value to my readers. Read my full disclosure policy here.