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Intro to YNAB 3 Learn the YNAB Way

Overview: What is a budget? How is YNAB different? Common Budgeting Myths & 4 Rules of Cash Flow Step by Step Demonstration of how to start your first budget What we will cover

What does the word budget mean to you?

A PLAN for your money What is a budget?

Remove yourself from the financial edge Understand what you can really afford Lower your stress level about money Why Budget?

YNAB is different - You’ll gain control of your money with simple, beautiful software that’s a joy to use In YNAB, everything’s built around the budget And on a tested methodology that will make sure you are successful Why YNAB?

Presentation Outline Overview: What is a budget? How is YNAB different? Common Budgeting Myths & 4 Rules of Cash Flow Step by Step Demonstration of how to start your first budget

Let’s look at some common budgeting Myths But I can’t budget! If budgeting is so great, why don’t people do it?

“It’s impossible to know what to budget for” Solution... Myth 1

Give Every Dollar a Job Rule One

The first step: Decide on Job Descriptions. We call those Spending Categories

YNAB comes pre-loaded with some pre-set categories... Master Categories are bold Sub-Categories are underneath...but you can make your own to fit your needs

Spending Categories

I’ve now given every dollar a job!

Spending Categories However...I haven’t given every job a dollar...

Spending Categories One of our goals is to get you out of that paycheck to paycheck cycle. We’ll get to that in a little bit. When you are first starting out you’ll need to budget each paycheck as it arrives, prioritizing as you go.

You will keep track of three things : As each month goes along... How much you budgeted How much you spent How much you have left

Not all categories are the same… Multiple times each month Once a month Entertainment Gas Groceries What else? Rent Utility bills What else?

Let’s take groceries as an example. Let’s say at the beginning of the month you budget $300 toward groceries.

Let’s take groceries as an example. On the 5th, you go shopping and spend $175. You enter the transaction in your register, and the budget is updated automatically. YNAB keeps track of the category balance for you.

Let’s take groceries as an example. YNAB keeps track of the category balance for you. You go shopping again on the 23rd and spend $95 more...

Let’s take groceries as an example. YNAB keeps track of the category balance for you. You make one more small trip...and the category is zeroed out

Here’s the difference: Spending decisions are made by focusing on the Category Balance.

Here’s the difference:...instead of the Bank Balance X

Think about it... Buy Now ! B u y N o w ! Everything MUST go!!! E v e r y t h i n g M U S T g o ! ! ! Spring Clearance !! No Payment for 6 months! For a limited time only! Buy 1 Get 2 Free ! 50% off TODAY ONLY! 0% DOWN!

Think about it... You need a better tool to use against that than just a Bank Balance! X

Let’s do a quick poll

“There are too many unexpected things that come up that you just can’t budget for.” Solution... Myth 2

Save for a Rainy Day Rule Two

Predictable We know when it will rain, because it was forecast. Car Insurance, Property Taxes, Car Registration Types of Rainy Days

It’s April now, and you have a car insurance payment due in June. This rain is forecast. Let’s take car insurance as an example

Let’s say the bill will be for $600, and it’s due in 3 months

Let’s say the bill will be for $600, and it’s due in 3 months

Let’s say the bill will be for $600, and it’s due in 3 months

Let’s say the bill will be for $600, and it’s due in 3 months

Unpredictable We don’t know when it will rain, but we know for sure that it will. Car Repairs, Medical Bills, Home Repairs Types of Rainy Days

Another Example

“I keep overspending my budget – and that shows that budgets don’t work” Solution... Myth 3 BANG HEAD HERE

Rule Three Roll with the Punches

Let’s use an example You budgeted $25 into your gift category for November......but forgot a friend’s birthday.

Let’s use an example Your friend has very expensive tastes…...and you overspent your Gifts Category by $50.

Let’s use an example Here’s the key point: You overspent your Gifts Category by $50 You didn’t overdraft at the bank, you just spent more than you planned in this ONE category.

Whether your overspending was a mistake, an accident, or a choice, YNAB helps you make an adjustment to start the next month fresh. Remember...

Let’s take a look at how it works YNAB automatically adjusts before you begin the next month Result: It keeps you on your budgeting feet, so when you fail, you don’t quit. You start each month with a clean slate–a huge psychological boost.

Cash flow is no longer an issue. You are just “borrowing” from yourself. In other words...

“I can barely make it from paycheck to paycheck - having a monthly budget will never work.” Myth 4 Solution...

Stop Living Paycheck to Paycheck Rule Four

How? YNAB will help you work towards living on last month’s income – not next week’s – by helping you build what we call a You’ll find breathing room. You’ll stop wasting time by timing paychecks with bills, and if you’re on a variable income, your budgeting “problem” will be eliminated. YNAB will help you work towards living on last month’s income – not next week’s – by helping you build what we call a You’ll find breathing room. You’ll stop wasting time by timing paychecks with bills, and if you’re on a variable income, your budgeting “problem” will be eliminated. Buffer

Live on last month’s income

✓ You are working with a KNOWN number so there is no guesswork. ✓ You no longer have to wrack your brain timing your paychecks with your bills. ✓ It provides a cushion that removes you from the paycheck to paycheck cycle. Why live on last month’s income?

“It’ll take too much time to budget.” Myth 5 Solution...

How? YNAB saves time

Give Every Dollar a Job By following Rule One you don’t have to wonder each paycheck where the money’s going. It already has a job.

Save for a Rainy Day You don’t have to scramble when an unexpected expense comes along, because you’ve followed Rule Two and prepared.

Roll with the Punches Since you follow Rule Three and just roll with occasional punches, little things don’t get to you and that saves time spent stressing over what to do.

Stop Living Paycheck to Paycheck When you are living under Rule Four, you can pay all the bills at once on the first of the month. That’s it! You’re done!

“I don’t want to feel restricted and controlled by the budget.” Myth 6

“I don’t want to feel restricted and controlled by the budget.” Myth 6

How do you feel now?

Overview: What is a budget? How is YNAB different? Common Budgeting Myths & 4 Rules of Cash Flow Step by Step Demonstration of how to start your first budget Presentation Outline

How much money do you have on hand right now to start with? Step 1: Calling All Cash!

When first starting out, keep it simple. Less is More. Step 2: Deciding on Categories

Figure out what’s due and when; Prioritize what’s most important Step 3: Dig out a Calendar & Your Bills

Create your budget. Always enter income FIRST, then budget it. Step 4: Your First Budget Meeting

Remember: You can’t budget money you don’t have. Step 4: Your First Budget Meeting

You will keep track of three things : As each month goes along... How much you budgeted How much you spent How much you have left

More Resources Inline Help You can search for any topic. Inline Help You can search for any topic.

More Resources

YNAB Community Forums 1. Quick Responses from different perspectives 2. Good, kind, knowledgeable people 3. Community Support in reaching your goals ynab.com/forum

More Resources Lots of FREE Webinars!