You need a budget (YNAB) advice thread

crunch_time · 30 March 2015 at 2:35PM

im a ynab newbie - if I get paid on the 19th of march and hubby gets paid 25th March and we use this money to pay for things in April, have we cracked the first rule??? or should this money pay for Mays bills? feeling confused...

nyermen · 30 March 2015 at 4:59PM

plymouthscubagirl wrote: »

However my bank never reconciles correctly. I'm going to reconcile more frequently so I can try and keep on top of this.
My main problem is that I have got my bank balance correct. However I tallied up the categories that come from the bank account and its about £200-250 adrift.

This is the trickiest part of YNAB (in my opinion). The problem is there are a number of reasons things don't reconcile, though the application does try to give some indications.
Off my head, i'd check the following:
1) Remember on budget vs off budget accounts - on budget account total should equal budget category total (unless you have income "for next month")
2) Have you entered a transaction into the wrong account?
3) Remember that the balances shown in the left hand side summary, are all transactions posted (not only transactions to date, not reconciled only). The idea is they are what you actually have left.
4) If it's a specific account doesn't match, then right click in the columns, and you can add "running balance". This is useful to check against bank statement to determine at what point it went wrong.

For point (1) above, if there's a mismatch between budget & on-budget accounts, this will be:
1) The income point noted
2) Category on a transaction not filled out
3) Mistake on doing a split transaction (not all sub-amounts add up)
4) Transaction allocated to a hidden category (more complicated than this, but you may have negatives)
5) Remember the options available for a category "overspend carry over".

NAB does have a "start fresh" option, which can be used to enter the latest balances and start again (of course it means re-allocating all the money to categories).

nyermen · 30 March 2015 at 5:03PM

crunch_time wrote: »

im a ynab newbie - if I get paid on the 19th of march and hubby gets paid 25th March and we use this money to pay for things in April, have we cracked the first rule??? or should this money pay for Mays bills? feeling confused...

i think rule 1 is don't let your money boss you about. Do you mean Rule 4 (live on last months income), in which case this is tricky. I get paid 26th too, and in reality, living on last month means waiting four days which isn't really the point. It should be a month (and four days). What I did was save a months income off balance sheet into savings, and then just allocate the pay to the next month. This way I truly do have "a months money" as backup (rather than four days). Others may do differently (I'd check the YNAB forums for more detailed guidance on the best approach).

Btw, there various options available for irregular income (eg. paid weekly, paid every four weeks rather than monthly, etc), these are also detailed in the YNAB forums I think.

Good luck

crunch_time · 31 March 2015 at 7:16AM

Thanks nyerman and yes I did mean rule 4. Shall have a look

Pixie5740 · 31 March 2015 at 7:23AM

Rule 4 is something you build up to eventually so you're not breaking any YNAB rules.

plymouthscubagirl · 31 March 2015 at 2:34PM

nyermen wrote: »

This is the trickiest part of YNAB (in my opinion). The problem is there are a number of reasons things don't reconcile, though the application does try to give some indications.
Off my head, i'd check the following:
1) Remember on budget vs off budget accounts - on budget account total should equal budget category total (unless you have income "for next month")
2) Have you entered a transaction into the wrong account?
3) Remember that the balances shown in the left hand side summary, are all transactions posted (not only transactions to date, not reconciled only). The idea is they are what you actually have left.
4) If it's a specific account doesn't match, then right click in the columns, and you can add "running balance". This is useful to check against bank statement to determine at what point it went wrong.

For point (1) above, if there's a mismatch between budget & on-budget accounts, this will be:
1) The income point noted
2) Category on a transaction not filled out
3) Mistake on doing a split transaction (not all sub-amounts add up)
4) Transaction allocated to a hidden category (more complicated than this, but you may have negatives)
5) Remember the options available for a category "overspend carry over".

NAB does have a "start fresh" option, which can be used to enter the latest balances and start again (of course it means re-allocating all the money to categories).

Thanks, I think I managed to 'fudge' it a little last night rather than start over. I have an off-budget account that I dont really need so use that to add/subtract to if things go wrong. Had to just remove £220 from my spending category this month as realised I dont actually have that cash in my bank from the category totals :mad: At least it all tallies now with the bank and category totals, so I'll just keep reconciling to make sure its all ok.

nyermen · 31 March 2015 at 5:30PM

With Off budget accounts, you should enter transfers as "income" or "expense" against categories etc, as you move money between on budget and an off-budget accounts.

Eg. I have a category "Savings", which each month at payday, I put everything not allocated elsewhere. The day before the next payday, I balance out things that won't carry over (eg. the month's food budget), update Savings, and finally do a transfer to my savings account which is off budget (and so deducts from the Savings category).

Anything leaving or entering the budget accounts must have a category, or you'll end up with unfilled categories, which could lead to mismatches (as the budget inevitably won't match the budget accounts).

In some ways it's worth thinking of it as a spreadsheet that does the hard work for you - it is slightly manual, it does require effort, but it also makes you appreciate your money, and there's nothing like watching the net worth increase...
(ps I have no connection with YNAB, I work in London for a financial software company...)

Peter.

lilahloo · 31 March 2015 at 9:34PM

I haven't managed to get on the credit card tutorial yet. It's always on at silly o,clock. Have just made my first cc transaction - have I got this right???

I have a 'rainy day fund'category (subcategories within it) and a rainy day account. The category amount is equal to the £ amount held in that savings account.

So I made a purchase on my cc which is on budget.

I transferred the £100 from rainy day account to credit card account.

Then I entered the transaction on my credit card account under my 'maintenance' subcategory.

Does that sound right? My credit card account is showing as 0.00. When I look at the transaction page there is an inflow of £100 and an outflow of £100.

I suppose that's right because the money has been allocated to clear the cArd when the statement comes through. It's just blown my mind a little.

Kermie · 31 March 2015 at 10:32PM

Been setting up my YNAB today and I'm already hooked! One question - I've got a money box (sort of an unofficial sealed pot) and I don't know if I should count that as a 'piggy bank savings' account of its own or solely as budget item which I spend on from my 'cash' account? If it's a spend item, do I then add it in as income at the end of the year (or whenever I chose to open it) and spend as I wish? I understand how my regular bank savings account works; just wasn't so sure for cash in a pot savings.
How do you do yours!?

Kermie · 31 March 2015 at 10:34PM

lilahloo wrote: »

I haven't managed to get on the credit card tutorial yet. It's always on at silly o,clock.

You can watch them on YouTube, although of course you don't get the chance to win a free YNAB that way... but it's worth watching.
I've just watched the CC one and it sounds to me that you've got it spot on, but I'll let the experts confirm, as I've only signed up today!

You need a budget (YNAB) advice thread

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