Are your finances stressing you out? You Need a Budget! Or perhaps you need Personal Capital? Both are apps which offer some smart financial management tools to help you get in control of your money. Find out the differences between YNAB vs Personal Capital in this article below.
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Personal Capital is a digital wealth manager, popular with investors with over $100,000 in investable assets. If you sign up for Personal Capital’s wealth management program, which has three different levels of service, you can have your investments fully managed, access financial advice and take advance of financial planning.
Alongside Personal Capital’s wealth management service, however, is a collection of financial tools that anyone can use for free. You don’t have to open an investment account to use them.
These free tools can help you create a budget, track your spending and see a complete picture of your finances. They can also help you calculate your net worth and manage your investment accounts.
With Personal Capital, you can focus on your long-term financial goals and get an idea of how much you need to be saving or investing now to get you where you want to be in the future.
YNAB is a paid-for personal finance budgeting app that aims to put users firmly back in the driving seat with their finances. To use the app, you’ll connect your accounts and then follow four principles:
1. Give every dollar a job
YNAB encourages you to account for every dollar of income. You’ll have to assign each dollar to a budget category, for example, groceries, gifts, rent or going out, until you’ve budgeted your dollars down to zero. Intentional spending is the concept here – really thinking about where your money will be going before you use it.
2. Embrace your true expenses
This principle is about predicting how much money you’ll need to spend in the future, including more substantial costs like Christmas presents, or annual bills. By putting money aside for future spending well in advance, it won’t hurt as much when you get an unexpected bill or overspend from time to time.
3. Roll with the punches
Sometimes things happen, and you might end up spending more on a purchase than you originally budgeted. While this might make you want to give up on budgets altogether, the way YNAB would have you handle this is to move some of your other budgeted funds from a different category to cover your overspend. So in real terms, that might mean you need to eat out less one month, but you can avoid debt.
4. Age your money
Lastly, through continued use of YNAB, you’ll hopefully get to a point where you’ll be using the money you earned last month to pay this month’s bills, rather than desperately waiting for payday and watching your cash disappear straight away.
Unlike Personal Capital, YNAB isn’t free. It costs $6.99 per month to use the app, although you can make use of a free 30-day trial. YNAB claims that new budgeters can save up to $600 by month two, which would more than offset the fee. A 100% money-back guarantee is also available, with no questions asked if you’re not happy with the app.
What people are saying about YNAB
The app scores (4.1 / 5) on Google Play and (4.2 / 5) in the App Store. One Google Play reviewer said he loved the app overall and really liked the method it applies to budgeting but struggled to justify the cost of the app. At $84 per year, he didn’t think it was worth it.
Another user highly recommends YNAB. He said that for years he couldn’t sleep for worrying about money. Now that he’s found the app, he’s living in financial reality with no more money worries.
An App store reviewer claimed that YNAB is life-changing. After using it for two years, he can finally keep up with his spending and is seeing improvement.
On both the App Store and Google Play, there are various reviews concerning the new version of the app, specifically around its number pad which is used to add transactions. The number pad has changed (it’s now smaller) resulting in some people finding it tricky to use.
With that said, another review over at the App Store refers to the new YNAB app as being a massive improvement compared with the previous version which was outdated.
The obvious difference is that YNAB costs $6.99 per month, whereas the financial tools from Personal Capital are free to use.
YNAB seems to be more geared up for people who need help with day-to-day budgeting, so they can regain control of their finances and work towards short-term financial goals such as paying off debt or building up savings.
Personal Capital focuses more on long-term goals and overall financial health, with the option to include retirement or college savings accounts for tracking and monitoring. It may work well for those who need a clear overview of all their financial activities. Its optional investment management service may also appeal to investors.
*The facts and figures above are correct at the time of publishing.