YNAB 4 was released earlier this year and it’s about time I shared my thoughts on the new version with everyone.
Just to recap, I started using YNAB almost two years ago by accident (YNAB 3 review). I set out to write a series of money management software review articles. Software is a passion of mine since I’m a technology project manager by day. I enjoy the mixture of personal finance and technology (two big passions of mine).
YNAB was one of the products I wanted to review so I downloaded a free trial version. After about 20 minutes of looking at the software I was wondering why I wasn’t using it myself. I told my wife the next day that we needed to try it. I was particular interested in the YNAB budgeting method (YNAB isn’t just software). I read the YNAB book that week and the rest is really history.
YNAB 4 was a major release which included a lot of UI changes, an overhaul to reporting and the official cloud integration with Dropbox. I had already been keeping my YNAB budget file in Dropbox so it was available to me wherever I had YNAB installed, but this release brought in the long awaited mobile integration with Dropbox. It also provided for a mobile lite application that doesn’t have all the bells and whistles of the premium app, but serves as a nice bonus to users who need minimal functionality on the go.
Fortunately, the YNAB methodology remains with YNAB 4. No changes there as the 4 rules continue to provide the foundation and method for using YNAB. Here’s a brief reminder: 1) Give every dollar a job; 2) Save for a rainy day; Roll with the punches; 4) Live on last month’s income. The YNAB team continues to offer awesome training on using the product (it’s free) and they cover the 4 rules.
Alright, my YNAB 4 review will cover some of the features that are new to the product as well as some features that are carried over from version 3 that I’ve come to lean heavily on in my budgeting.
UI Improvements
The UI changes included some color modifications that make the application much easier on the eyes. Whoever is doing the design over there is doing a great job, in my opinion. I love the colors, graphics and over feel of the application. You can check out the YNAB website to also see this unique design. They also increased font size in the application which makes it easier when looking at your budget and spending transactions. Overall, there are nice changes here that gave the software a more professional look and feel and has improved the usability of the tool for me.
Cloud Sync
This functionality was much needed and helps YNAB compete with the features of the web based software out there. Most people need access to their transactions and budget while on the move and cloud sync enables this now that the mobile apps are integrated. I used the premium mobile app and have found that I can now do all my transaction entry on the go with ease. When I want to use the desktop app, my transactions are there for me. The best benefit to using the mobile app is that you’re carrying your budget and transactions around with you. You can see how much money you have left and make smarter spending decisions while at the store!
Allow me to digress for just a second…
Web based software or desktop software? YNAB is desktop software unlike Mint and Mvelopes. I don’t miss any web features with YNAB and I actually like the software running locally on my computer vs over the web. No page refreshes! I just click through the application and use it. Generally, a desktop product is going to perform faster than web based applications as long as it’s been well designed.
Mobile
There are three options available for mobile YNAB: iPhone lite, iPhone and Android. The iPhone and Android apps cost $4.99 at the time of this post and the iPhone lite version is free. I use the $4.99 iPhone app and my wife uses the iPhone lite version. All versions provide cloud sync and the ability to view your budget. The paid versions provide the extended capability to view account details and transactions.
Yes, but isn’t $4.99 high for a mobile app when others are free? Honestly, I’m such a supporter of YNAB that I don’t mind paying this. They have to run a business and I know this work doesn’t come cheap when it’s done right. I paid the $4.99 once and my wife uses the free version. This works perfectly fine for us.
Reporting
Reporting saw a lot of nice changes to the UI and overall design of the module. You can run spending by category, spending by payee, income vs expense and net worth reports. Filters include time frame, categories, payees and accounts. The results of the spending reports display in a pie chart that’s easy to read and graphically pleasing. Clicking on the pie chart will take you deeper into the budget category where you can see spending broken out by subcategory.
I primarily use the spending by category report. For example, I’m trying to keep a better eye on the actual costs of our irregular spending this year. I have irregular spending as a top level category with several subcategories for gifts, vacations, kids activities, and more. I’m able to quickly see all my subcategory spending across months using the filters I mentioned above.
But if I really want to look at the details, YNAB provides the ability to export my spending into a spreadsheet. I love this feature because I can see total spending for the current year by subcategory and month. It also shows me average spending per month and the totals across each month. This is huge when planning my budget. It really give me a good idea of whether or not we’re budgeting enough for irregular spending each month.
The irregular expenses are the ones that will make your monthly expenses look smaller than they really area. YNAB provides the ability to plan ahead and make sure expenses that only occur a few times a year are averaged out across the entire year so you avoid surprise expenses by making sure there is enough money in your account.
Other Features
The YNAB team produced hundreds of new features in YNAB 4 according the website. I’m not going to be able to cover them all in this review, but I do want to mention a few others that I like and use often.
Notes
You can now add a note just about anywhere in the application. No more sticky notes if I need to note something about an expense. I can add a note to a transaction, category, subcategory and probably more. This is also helpful for husband and wife who are managing money together. You can capture notes and then review them later when you discuss your budget.
Account Reconciliation
Account reconciliation is a new feature in version 4. It helps you reconcile YNAB to your bank statement and quickly identify and descrepancies. I review transactions between YNAB and my bank each day and manually clear them. So, my account stays reconciled nearly real-time. I know this will be a good feature for people who don’t like to reconcile to their bank account each day.
Auto Save
Nope, you don’t have to worry about losing your work in YNAB. The application has auto save so Drobox is getting updated and that means YNAB is automatically updated when opening the application on your mobile device too. Very cool this is all happening in the background.
Search
Search isn’t new, but I use it constantly when reconciling transactions with my bank (Perkstreet Financial). I typically use the feature to search for a payee or a specific dollar amount. It provides me the ability to quickly find duplicate transactions I’ve mistakenly entered and believe me, I do this at least once per month. :)
Unified Budget Display
If you were a YNAB 3 user, you might appreciate how the information for your budget each month such as “Over Spent in…” is in the header instead of the top and bottom of each month. I always use this information to catch overspending and determine how it might impact us next month if not balanced in the existing month.
Printing
There is a new print engine that lets you print everything you see on the screen instead of sending it to a PDF file. This is great if you want to print off your budget.
Improvement Ideas
The mobile software is nice, but I think it would be helpful to have a tablet version of YNAB as well. I’m sure anyone reading this from YNAB is laughing at that comment as I’m sure they’re hearing this request quite a bit. My iPad is with me just about wherever I go these days. At the same time, I’m doubting I would take it in the grocery store to track an expense (my iPhone will do just fine). I’d probably opt for my tablet to review my budget and/or enter transactions if I’m sitting at my desk. Overall, this is a nice to have for me.
YNAB is a methodology and budgeting software and I’d like to see them stay true to that and not try to integrate every part of our financial lives into the product like other software does. That being said, budgeting is closely tied to getting out of debt. I think there might be an opportunity to create some debt pay off planning into YNAB.
All the same lines, YNAB may have an opportunity to partner with other providers such as Betterment for investing or even Manilla for bill management. YNAB could think about ways to display some of this summary investment information or even bill due dates from Manilla in their application. Therefore, I recommend YNAB look for some of these strategic partnerships that could bring them more customers.
Pricing & Free Trial
If you’re a YNAB 3 customer you can get special upgrade pricing. This is quoted from the YNAB website:
If you purchased YNAB 3 after December 26, 2011 then YNAB 4 is on the house. If you bought YNAB 3 before then or if you own YNAB Basic or Pro you can purchase YNAB 4 for an upgrade price of $40. If you purchased a YNAB Disc from Amazon please contact us and include the Amazon order number and the email address that you used to place the order.
For new customers YNAB 4 costs $60. Is it worth the price? Hopefully, based on my review, and considering I’m a customer and fan, you know why I think YNAB is probably the smartest investment of managing your finances you can make.
But if you’re a new customer and still unsure, YNAB offers a ridiculously generous offer of a free 31 day trial. I recommend giving it a try for a few weeks. You’ve lost nothing if you don’t like it or it doesn’t improve the way you manage money.
About Jason Price