YNAB - You Need a Budget

2026-03-26 Tags: software

I've been using YNAB, "You Need a Budget", since 2014. It's a digital implementation of the "envelope" budgeting method. Originally, you would cash out your paycheck, and then divide it up into envelopes labeled "rent", "groceries", etc. That way you knew you had money set aside for rent, and if you want to go out to eat but don't have money in the "eating out" envelope, you have to make an explicit decision to take money from a different envelope.

You're expected to change plans and adjust your envelopes, it just forces you to be mindful about where you want your money going. This works super well compared to traditional budgets, where you set goals and then later chastise yourself for not sticking to them.

But cash is fiddly and not compatible with our modern era, so YNAB provides digital buckets or categories to replicate this idea. It can sync with most banks and credits cards to import your transactions, just requiring you to confirm or adjust which category each transaction is spending from, but I don't really trust giving software access to my bank accounts (more banks should support read-only api tokens) and just manually type in my transactions three or four times a month.

It started as a one time purchase and transitioned to a subscription model a long while ago. I still think using it will absolutely save you far more than the 9 bucks a month (paid yearly), but you could probably replicate it in google sheets if you're handy with spreadsheets. I'm pretty bought in and like having 12 years of data in my charts and tables, all in one place.

I got a ton of value out of it when I started really focusing on saving a decade ago, but still find it helpful to keep an eye on how often I eat out or buy snacks, and make sure I'm not spending too much on electric scooters, squat racks or steamdecks (recommendation posts pending).

Minor gripes

They changed how credit cards work to more accurately reflect reality - when you pay with a credit card, it moves that amount of money from your category into a "set aside to pay off your credit card" category. In the original version, it would pretend that that money was just immediately gone from your accounts, assuming you will only buy things on credit you already have the money to pay for, and will always pay your credit card bills in full.

This is probably much better for people paying off credit card debt or managing cashflow, but if you already have some savings it overcomplicates things.

Recommendation

Students with a .edu email address can get a free year's trial, which is great. If you do try it, I think you really need to commit to learning it and using it for a couple months - it isn't zero friction, but the friction is kind of the point, because it makes you think about if your spending in the moment lines up with your priorities.

If you sign up, ask a friend for a referral code for a month off, and sign up anywhere but on iphone to avoid paying Apple 30% unnecessarily.

If you're the kind of person that finds thinking about spending and budgets painful, YNAB might be a big hurdle up front, but I think thinking in terms of how you want to prioritize your dollars will be way less stressful than 1. not knowing, or 2. using a regular budget and feeling unhappy that you're overspending.