Thanks for asking because I've been trying to articulate it but all my friends run far away fom me when I start talking about money and budgeting these days. Between this forum and that one I feel more in the drivers seat of my finances then I have ever before in my life.
In a truly frightening kind of "I spend that much money on THAT!" way.... but in a great way because you can see the impact of your daily coffee habit on your car insurance payment 6 months away.
The hardest thing for me so far has been figuring out how to add into my budget 1/12 of my annual bills. I've never accounted for that monthly before and I don't have that kind of give in my money right now. But I can see how I'll be able to do that in a few months time.
Here is an example:
Bill Wizard on my PDA is how I forecast how my bills will be paid. Every year on January 12th I send GEICO $162 for my motorcycle insurance. Bill Wizard projects that into my future and I can see how much money I will have in my accounts on that date and then I move money around to account for it. But what I don't do is budget for that in May of the preceding year.
YNAB makes you account for all your annual Bills in 1/12 increments and then when they roll around there is no need to shuffle money around to account for them.
From the chatter on their forums a lot of people really have to work towards building up the buffer that the system requires. I'm really lucky in that I had that much sitting around in a credit union so I simply transferred that to my checking account and set to budgeting.
The heart of the YNAB system is a "buffer" which is comprised of last months paychecks in order to allow you to save this months paychecks. You can only live on last months money that you have budgeted into categories beforehand. The premise is that you are never broke and don't have to worry about fluctuations in income if you are always living on what you have ALREADY earned.
So the buffer is one full months income.
So I'm earning May's income and it is just pouring into my checking and sitting there.
Also sitting there is all of April's income.
April's income is what I'm paying my current bills with.
May is accruing.
And I'm budgeting for June's expenses with an eye to leftover April income instead of instantly using Mays.
Whew. It is hard to articulate though. The way I'm beginning to think of it is,
Quicken is a snapshot of yesterday.
BillWizard and YNAB are crystal balls showing me the future,
but BillWizard shows me big stuff, (credit cards and mortgages,)
and YNAB is big stuff plus all the $1 cups of coffee as well.
In fact BillWizard doesn't even use change. You can only use round dollars figures.
YNAB will show me over my budget by .11 cents.
I took advantage of a $10 off coupon he was offering so I bought YNAB Pro which is a stand alone piece of software for $29.99. It downloads transactions right from your bank so if you use a debit card you don't need to enter receipts for things. I can also say the tech support is the most amazing I have ever dealt with. I sent in a bug report and within 15 minutes had email waiting for me telling me to delete a particular font and then it worked perfectly. The only other bug I found, they put out a fix for the very next day in a members only area. No other bugs and so far it has worked perfectly on 2 different computers. I simply put my budget into my yahoo briefcase and then download it at work. The upload it again to go home.
Two thumbs way up but only if you want to see all the leaks in your money handling.
This is the personal finance software that is getting me to give up my 2 cup a day coffee habit.
Hell I already brown bag two meals to work and eat effing gruel in the morning and now this software is showing me that coffee is out as well. Oh well... 2010 I am gonna host the biggest ARM burning party ever! (And it'll be potluck *&* byob because being frugal will be a habit by then.)