YNAB vs. Credit Karma

Mint’s strong suit was expense tracking and spending reports, but it also had key budgeting features that Mint users have used for over a decade. 

Now, Credit Karma is a popular personal finance app in its own right with a whopping 100 million members. However, it doesn’t offer an option that allows users to proactively manage their money.

Credit Karma users will be able to track their net worth, see a breakdown of their monthly spending, check their bank account balances, and connect their financial institutions to Credit Karma, but they will not be able to set spending limits, create monthly budgets, or track their progress on savings goals. 

Credit Karma is not a budgeting tool (and gravy is not a beverage). 

So, to answer the question: Is Credit Karma the best budgeting app for former Mint users? Probably not. 

Why Use Credit Karma?

Right at the top of Credit Karma’s home page, they explain that “Intuit Credit Karma uses your credit profile to show you curated recommendations.” 

In short, Credit Karma exists to advertise to you. That might sound like a cynical take, but it can be useful. Credit Karma will use your valuable data to show you financial products you might find helpful. And Credit Karma will also show you your credit score for free and give you ideas on how to improve your credit. With better credit, you’ll be more qualified to take out personal loans, which leads to more revenue for Credit Karma. 

It’s a cycle that’s good for Intuit, good for lenders, and might be useful for you too. So if you just want to track your credit score and find new investment accounts, credit cards, savings accounts, and other financial products, there’s nothing wrong with only using Credit Karma. 

But if you have no option but to try something new, why not go with something that’s different but still meets your needs? And what if that something fulfilled needs that you didn’t even realize you had? 

What if this change was an opportunity to build better habits and to get more clarity about your money and your goals? 

Learn more: YNAB vs. Mint: A Better Way to Manage Money

Why use YNAB?

YNAB has been changing the way people think about money for 20 years now (and we’re not going anywhere). 

Imagine never second-guessing your spending. Imagine saying goodbye to cash flow issues. Imagine never needing to check your checking account balance before making a purchase. Imagine the relief of always knowing your spending is worth it and never feeling guilty or doubtful about your money… ever!

YNAB accomplishes all of this and more by helping you build four simple habits, backed by an app that encourages you to spend intentionally, save effortlessly, and give joyfully. Here’s the method behind YNAB magic: 

Habit 1: Give Every Dollar a Job

The first habit is all about being purposeful with your money before you spend it. Every dollar you spend on something you don’t really care about is a dollar you can’t spend on something you do care about. In YNAB, you assign a purpose to every single dollar you have—no matter what it is—to make sure your money flows toward your priorities.

Habit Two: Embrace Your True Expenses

Unexpected expenses aren’t really unexpected, are they? You know your car will need new tires, the holidays come every single year, and you’re probably not going to cancel that Amazon Prime subscription. The second habit is about acknowledging and preparing for those non-monthly expenses. Break them up into monthly bite-sized amounts, so when these expenses come up, you can just pay them. No fuss!

Habit Three: Roll with the Punches

Managing your money shouldn’t feel punitive or restrictive. Yes, you make a plan for every dollar and, yes, you should try to predict “unexpected” expenses, but if something comes up or your plan changes—you just move money between categories to cover it. Habit three says it’s okay, even smart, to change your plan for any reason. Just do it with your eyes wide open. 

Habit Four: Age Your Money 

As your awareness grows, you’ll naturally start spending less, which means you’ll be saving more. You can take that extra money and start setting it aside for next month’s expenses. Eventually, you’ll be paying bills with money you earned more than thirty days ago. This leads to more space to make decisions and a lot more peace of mind.

The YNAB Method is what sets YNAB apart from any other option for managing money; it’s more than math, numbers, and graphs. It’s a habit-building tool that supports and inspires you to fund a future you’ll love living in. 

Learn more: YNAB Isn’t a Mint Alternative—It’s Better

YNAB or Credit Karma—Do You Have to Decide?

Let me come right out and say it: When it comes to YNAB or Credit Karma, it’s not an either-or decision. You can certainly use both. Why? Because the two apps serve very different purposes. 

YNAB will guide you through a set of habits to discover how you want to spend your money. It produces a proactive approach to money management, along with flexibility so you can change your plan along the way—without guilt or shame, but with full awareness of any potential tradeoffs you’re making. It offers a big picture perspective of your finances and includes helpful features like a loan payoff planner, targets for spending and saving, and the ability to share your subscription.

Credit Karma is helpful for tracking expenses, checking your credit score, getting recommendations for financial products, and partaking in a passive financial overview. 

They both have a place and a purpose. 

A Word About Your Data

Another key difference between YNAB and Credit Karma has to do with your data and the business models of the companies behind the product.

Credit Karma makes money when you purchase products from their advertisers. That means Credit Karma’s customers are financial institutions, not their users. The problem with this business model is there is an inherent conflict of interest. Because Credit Karma makes money through advertising, there is always a tension between doing what’s right for their users and pushing products that will make them the most money.  

The only way YNAB makes money is directly from their users through a subscription. That means you are always the customer, never the product. YNAB succeeds when you succeed. That means all the incentives are pointed in the direction of helping you. That’s why we have award-winning customer support! That’s why YNAB offers free education. That’s why YNAB is out to change your life and Credit Karma is out to sell you debt products. 

In the fintech world, YNAB’s business model is proven and has longevity. Mint may be shutting down in part because they were never able to be profitable under the free version of their software. Even offering some new Mint features and functionality behind a paywall did not save the product. A financial app needs to be reliable and remain for the long haul, which is why a simple, proven business model is better for the company and the customer. 

Learn more: Join a free, live workshop about Transitioning from Mint

Do You Want to Change Your Life?

When was the last time you’ve heard someone say that a money-planning tool changed their life? At YNAB, we hear that from users every single day. Really.

If all you want is to track your credit, check your financial account balances, and find deals on credit cards, Credit Karma may be enough for you. 

But if you want to change your life, if you want to love the way you spend your money, try YNAB. And, hey! If you want to do both, that’s fine too! We’ll be here to help. 

Mint shutting down may have thrown you for a loop, but you can turn it into an opportunity. Migrate your mint data to YNAB and sign up today. It’s free for a month! 

Related Articles
YNAB vs. Credit Karma