First Impression of YNAB

No, this is not an April Fool’s post. This is a few of my first impressions using You Need a Budget.

  1. I don’t mind the approach it takes of budgeting actual cash on hand. I like the digital integrations with everything from Bank of America to Venmo.
  2. It appears to take a category-oriented approach, much like every other budgeting app out there, and I find that super annoying.
    1. My transactions are always getting stuck in the wrong category and it’s hard to fix. This is a key reason that I am looking outside of the Bank of America budget offerings.
    2. A category-oriented approach stands in contrast to an account-oriented or transaction-oriented approach. I want to be able to view all three.
    3. I want to be able to use tags at the transaction level. For example, I may be spending on gas, but I’d like to tag it as also related to vacation. Then I can see my vacation spending over time.
  3. I haven’t used this yet, but it appears to be able to support my wife and I both logging into the same budget, from desktop or mobile.
  4. YNAB, as most budget tools, seems to lack deeper insight into savings and investment optimization. It also doesn’t seem to integrate with discount vendors or discount systems like Honey. It seems mainly helpful for tracking spending, rather than for optimizing consumption of investment decisions in a forward-looking, comparative way.

I also tried Albert and True Bill. They both seem neat! Albert helped me discover the reason Bank of America had an overstated gas and auto budget. It was including gas expense for my house. However, Albert appears to be mobile-only, which is a problem. It’s also not obvious that my wife and I can share an Albert account. I’m also intrigued by Financier, but I haven’t used it.

True Bill was great to use, but I’ve yet to see if the bill negotiations they offer will be successful. I was able to find a cheaper car insurance policy pretty easily.

I see lots of good things in YNAB, but it’s also missing lots of things that I want from a full featured personal finance tool. I’m hoping to eventually craft my own personal finance software because I know I’m picky about this stuff. Here are some features I’d like to include in my tool:

  1. Advise spending, rather than simply tracking spending, by reviewing purchases and suggesting cheaper alternatives. True Bill is kind of doing this with selected service negotiation.
    1. Including big picture items like higher ed planning, home purchase, auto purchase, family planning, and so on.
  2. Allow people to view spending by tag, category, or account.
  3. Open source the project. Make it easy to modify and extend.
  4. Allow users to edit auto-processing rules which categorize, tag, and classify incoming transactions.
  5. Allow users to measure net worth with first-class support for assets.
  6. Advise on investment and refinance.
  7. Integrate with incentives providers.
  8. Consider personality, values, time preference, risk preference, and so on. Create a life plan or an economic plan, not a purely financial plan.
  9. Pay attention to interest and amortization. For example, YNAB stated it would take me 31 months to pay off a $7,700 credit card balance by paying $250 per month. This clearly ignores interest.
  10. Asset management features. Consider equity and expected account value changes. Intelligent forecasting with statistics, not just backward-looking reporting.
    1. Also allow scenario-based forecasting, and allow users to edit fundamental changes in comparison to statistical changes. For example, if my income increases $100 per month, this is fundamental. That’s in contrast to my gas expenditure which is statistically estimated. However, I should be able to mark that I started driving a new car in February and the system should be able to answer the question “Did my gas usage change in a statistically significant way, and if so what change is attributable to the new car?”
  11. When creating account plans, allow amount-or-monthly-value feature. YNAB makes you choose one or the other. You can’t allow them conditionally together. As a user, I’d like to have the system budget $250/month toward my goal until a desired balance has been achieved, then the system should reduce the budget per month to 0. I may desire to have non-linear month-over-month reallocation.
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