YNAB (You Need A Budget) is a personal finance and budgeting software, so freelancers and self-employed individuals can use it to plan income and expenses. It lets you allot money for incoming expenses and shows you the funding status of each expense item. You may also account for inflows as they are deposited into your savings account. YNAB costs $14.99 per month, and you can try it free for 34 days.
YNAB Alternatives
Best for: Simple budgeting | Best for: Complex budgeting using sophisticated projection methods | Best for: Detailed budgeting |
Cost starts at: $30 per month | Cost starts at: $99 per month | Cost starts at: $70 per month |
Why We Like YNAB
Throughout our YNAB review, we’ll emphasize that it’s truly a good budgeting software for freelancers and self-employed individuals. The personal finance app lets you plan out future expenses and fund them within the platform. Since it uses a zero-based budgeting approach, users need to always plan their projected monthly expenses from scratch, which enables them to be more aware of their spending.
Its funding feature assigns money to each expense, so you’ll know how much will be left after allocating money for expenses. However, YNAB doesn’t deduct money automatically from your bank account when expenses are funded—you still have to pay for the expense on the due date.
YNAB Pricing
The YNAB pricing page shows that a monthly subscription costs $14.99 and that you can save more by getting an annual subscription for $99. You can select the 34-day free trial before subscribing.
YNAB Features
YNAB’s features focus on managing your finances. Freelancers can use YNAB to budget expenses per month and fund them as they receive income. Let’s learn more about YNAB’s features.
After you sign up, YNAB will redirect you immediately to the budgeting window, where you need to budget all default accounts. You may also add more accounts and categories during the process.
When you click an account (see the account with blue highlight), budget details will appear on the right side of the screen. There are two major fields to fill out: target type and the amount needed. The target type drop-down (see image below) lists the nature of spending. You can select different target types per budget line item.
- Needed For Spending: Use this for expenses with due dates or consumables, such as groceries and food expenses. By choosing this, you can select to fund expenses on a daily, weekly, or monthly basis.
- Savings Balance: If you’re planning for large expenses with no definite date—such as vacation and holiday expenses—then you can budget these expenses using the savings balance target as it enables you to fund a savings balance target as you go. It doesn’t require specific amounts and dates to allot money.
- Monthly Savings Builder: You should use a monthly savings target for budgeting expensive items like a new vehicle or house. You can use this target to set aside a specific amount every month.
- Monthly Debt Payment: This is best for existing monthly amortization of loans and mortgages.
On YNAB, you can add bank accounts and credit cards. You also have the option to link them, but you can still use YNAB without a live bank feed connection. If you choose the latter, you’ll have to reconcile your accounts every month and review monthly bank statements.
The image below shows how to add an unlinked bank account. You need to refer to your latest bank statement to get your updated bank balance.
After you budget expenses and add at least one account, your budget dashboard is good to go.
There are color-coded bars in the budget:
- Yellow means that you haven’t fully funded the expense.
- Green indicates that it is fully funded.
- Gray means that you haven’t funded a single dollar to the expense.
One of YNAB’s best features is that it lets you fund expenses. Funding can be based on a specific period, such as daily, weekly, or monthly, or indefinitely if the expense doesn’t have a due date.
The image below shows the funding status of the rent or mortgage expense. You’ll see on the right side that the target amount for rent or mortgage is $2,500 by the end of the month. Below, the target figure is a bar that visually shows the level of funding.
In our example above, rent is 30% funded. Freelancers will like this feature since it helps them plan large cash outflows by allotting money in advance.
Inflows from freelance income or compensation won’t appear in the budget dashboard. Instead, you’ll have to enter it in the bank account registered in YNAB.
Cash inflows will increase the balance of your account. If your account is linked to YNAB, it’ll record cash inflows automatically through a bank feed connection. YNAB recommends that you record income only when it is received. In this way, your bank balance will always reflect the actual cash in the bank.
YNAB Ease of Use
We find YNAB easy to use, even for individuals who haven’t tried budgeting software. If you’ve been budgeting income and expenses using spreadsheets, using YNAB will be a breeze since it comes with budget line items automatically—and you can create new line items for specific spending activities.
Busy freelancers will find YNAB easy to navigate and understand right out of the box. It will be easier if you connect a bank account or credit card.
YNAB Reviews From Users
Those who left a YNAB review highlighted that it is a great tool to track financials monthly. They said that it helped them stay stress-free in managing their bills. One user mentioned that it helped them manage their hard-earned money as a freelancer since income from freelancing is fluctuating. Overall, users like its fund concept since they get to fund expenses before they are paid.
On the flip side, reviewers with comments that lean negative mentioned that its learning curve is steep and that it requires a lot of manual entry. Some also noted that the pricing can be lowered at a more affordable rate.
Here are the scores of YNAB in popular user review websites:
- Trustpilot1: 4.6 out of 5 stars based on more than 850 reviews
- G22: 4.6 out of 5 stars based on nearly 30 reviews
Frequently Asked Questions (FAQs)
YNAB uses a zero-based budgeting method. Under this method, users have to create entirely new budgets per month. It means that YNAB can’t copy previous months’ budgets and carry them to the current month. However, users can still do that manually.
No—you can only budget funds monthly. For freelancers and individuals, budgeting monthly can help them see where their money is going.
Bottom Line
YNAB offers a comfortable budgeting solution to users wanting simple budgeting software, and freelancers needing to track income and expenses will benefit from YNAB. The ability to plan monthly expenses will help them assess if freelancing income sources are enough to cover expenses. Regardless, individuals just seeking to track their finances will find YNAB a great tool for managing their resources.
User review sources:
1Trustpilot
2G2