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September 25, 2017
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In my last post I discussed zero-based budgeting and how it can really help to turn your finances around. In this post I want to cover some of those tools that can make the budgeting process faster and easier, so you can stick with it month after month and foster the good habits.


This is one of the best known and most popular budgeting apps because of its ease of use, simple syncing with your accounts and across devices… and the best part is that it’s FREE! It automatically tracks your spending when you connect it to your banking and credit card accounts. The spending categories are customizable, so you can try and create categories that conform to how you spend money in the real world.

So, it costs you nothing and syncs perfectly, our hunt for the perfect budgeting software is over, right?  Not so fast. In my last post we discussed the differences between tracking and budgeting. Well, Mint is great because it tracks things so well, but in the budgeting department I feel as though it falls a little short. Every month is different, and it is hard to make those adjusting monthly expenses conform to what you are up to with Mint. Also, because it is “free”, you will find yourself dealing with lots of various ads steering you toward specific financial services that you may or may not need. Overall, I would say that Mint is a great way to start keeping track of your expenses because of the cost (zero) and its ease of use. However, once you figure out the zero-sum budgeting process, there are better options for you.


This program is more of a power-user’s version of In fact, it was actually owned by the same company until recently. Some people may recognize the name if they have ever had to budget or track spending for a business (aka: QuickBooks), others may recognize it as the “original” personal finance software.

One of the differences between Mint and Quicken is that Quicken is a program that you have to pay for and download or install on your computer. Quicken also has an iPhone and Android app that has drastically improved over the last few years. Yet the Quicken data lives as a file on your computer, so security-conscious types may prefer that over the cloud-based options like Mint. By forking over a little cash you also get some features like the ability to set retirement savings goals, and you can directly import into services like TurboTax to make your life easier when you’re dealing with Uncle Sam in April.


If you’re looking for a tool to help you tackle the zero-sum budgeting game, YNAB (You Need A Budget) might be your best bet. Like Mint, it is a cloud-based app, which can make it easy to access and use regardless of your computer or operating system. Yet, it is a bit different from Mint and Quicken because it charges a subscription fee, which (over time) can make it more expensive than the other two options. However, in my experience, it’s worth the cost.

YNAB’s power comes from the fact that it is BUILT for the zero-sum budget…. Or as the YNAB people say, “every dollar has a job”. This is a great approach. Each month you look at your income and decide at the beginning where each dollar should be spent over the course of the next 30 days, which really is the holy grail of budgeting, in my opinion.

Now, if that sound tedious, YNAB has some awesome tools that allow you to roll the budget from the prior month over, make some adjustments, and go from there. They also have an option to create a budget out of what you SPENT last month, which can help you get real about your spending and where you might need to allocate a little more. After a few months, you can even make a budget out of your average amount budgeted or average amount spent. This helps you to stay on track with your budget, but not have to stay at home every Saturday night sorting our every penny you have.

Do you want to go old school?

  The Envelope System

THIS is old school. Do you know why your grandparents (and maybe even your parents) did this back in the day? Because it works!!  With the envelope system you use cash to pay for the things you need, and you create an envelope for the things in your budget, like groceries, clothes, restaurants, etc. At the beginning of the month when you get paid, you stuff the money you have budgeted for each category into its respective envelope, and when the envelope is empty, you’re out of luck if you want to keep spending in that category.

Now, if it's late in the month and you need to buy groceries, and the grocery envelope is empty and you take from your clothing envelope, that’s OK! That is a real-world, real-time budget adjustment that still keeps you on track to stay within your overall budget for the month.

So, in theory the envelope system is great, and it REALLY DOES help to put the clamps down on out of control spending… especially in problem categories. Yet, these days the use of cash is become more and more rare (auto-bill-pay anyone?), and people are even bailing on the use of debit and credit cards (cough... *Apple Pay*... cough). The bottom line here is that the envelope method is a great way to control discretionary spending, but in today’s world it probly wont give you what you need in the way of budgeting overall.

    Pencil and Paper

Speaking of old school, this one ranks right up there with the ol’ envelope system. How does it work? You know how it works. You sit down at the beginning of the month with an empty piece of paper, figure out how much your bills will likely be, figure out what your paycheck is, and divvy up the incoming cash to each of the outgoing categories. Is it time consuming? A little. Is it easy? Well…. YES. In fact, it could be the easiest way to get started of all of these budgeting options. As you work on your budget, you’ll likely find that you would like the help, automation, and mobility of some of the other options like YNAB, Mint, and Quicken. Yet, if you want to get rolling right now, don’t want to spend a nickel, and computers/the cloud/the internet scares you a bit, this is a good way to start.


I know what you’re thinking, this is simply a 90's version of the old pencil and paper system, and you might be right. However, I felt as though I had to include this option because it’s the one I actually use. I love YNAB and all of its tools, but in my budgeting system I have actually tailored the categories in Quicken and use them to track spending, then I port them over once a week to my spreadsheet (I use Google Sheets these days). I feel as though it gives me the most control and the best look at my spending versus my income. When a new month arrives I just copy my budget from last month, make a few adjustments, and I’m off and rolling. The time consuming part here really isn’t the budgeting, but taking the time every week to move the information from one system to another.  

Spreadsheets intimidate lots of people, but with a little tinkering (and maybe a YouTube video) it's actually really easy to become functional and can help lead to a mastery of your budget that sometimes just doesn’t come when a service like Mint or YNAB is doing all of the number crunching for you.

Bottom line...

So here it is: if you’re looking for an app to help ease the budgeting chore, and you don’t mind paying a subscription, then I think YNAB is really the choice for you. It’s tools are really designed to assist with the best (and, in my opinion, only) way to budget your money. However, if part of your budget includes not spending any money on budget software, consider using something like Mint to help you track and categorize your spending, then use some other kind of...uh… throwback method to apply your spending to your budget. It will really give you a clear look at how you spend your money and where you go overboard.

One last piece of advice: don’t wig out when you see how much you spend eating out after you do your first budget. It’s always the category that blows everyone away, and it's the easiest to do something about.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. The applications and software noted herein are not affiliated with, nor endorsed by, LPL Financial.