You need a budget (YNAB) advice thread

Frogletina

redmel1621 wrote: »

Please tell me this gets easier!
It seems very time consuming at the moment and I can't turn it off.. I have an assignment due Tuesday so really need to focus on that but instead I am sat here playing with YNAB.

I feel like I've missed a whole weekend myself!

I'm sure it does get easier in time, but maybe the more you 'play' with it the more tired you get and are not learning anything new.

Time to take a break, I think

frogletina

Red-Squirrel_2

January2015 wrote: »

My bills such are mortgage, utility etc. are also set in stone, but I can't enter them in YNAB until the income to cover them is in the bank - I get totally confused otherwise and am operating on a minus to budget figure.

I get paid at the end of the month (so all my salary is always going to be allocated to the following month (essentially the next day or so, but for YNAB purposes it's the following month). DH gets paid middle of the month.

Based on these pay cycles I budget in YNAB for those items I know will have to be paid before the middle of the month (covered by my salary) and only when DH's salary hits the account do I budget the items due between mid and end of each month.

This works for me and I just cannot 'forecast' costs months ahead or the 'give every dollar a job' aspect is lost for me because I have no idea what I have available anymore - even in the current month because as soon as I put in all the set bills for the month without DH's salary to cover some of them - we are in deficit on the 'to budget' bit

Edit: I did, in the past, forecast my bills like this in Excel - but only budgeting the money we actually have is working far better for us.

It works for me for now, I don't mind seeing the minus figure through the month as long as it zeroes after payday and before moving onto the next month! When you budget into the 'master category' it adds up a sub total that I find useful for fixed costs, for example I now know I have £609 accounted for out of each wage on fixed monthly outgoings. Before YNAB I thought it was about 500 or so, had never taken the time to add them all up including the little ones that are easily forgotten.

I'm not suggesting anybody else has to do that, and I may well move over to the more 'orthodox' YNAB way in time as I get used to it, but for now this is helping me get a fix on what I actually spend rather than what I think I spend.

kiss_me_now9

Just watched the intro seminar and I'm still lost I just find it really hard to get my head around the not physical aspect of money, I think.

Bublin1

kiss_me_now9 wrote: »

Just watched the intro seminar and I'm still lost I just find it really hard to get my head around the not physical aspect of money, I think.

I just attended that one and I have to say, she did a terrible job of explaining it. Seemed like she was rushing it as the last Intro webinar I attended lasted an hour.
Try the youtube videos and sign up for the next Intro class.

andyfromotley

I agree that YNAB isn't much use as a forecasting tool. Its all about budgeting for the here and now. 'What do i have available today?" My problem wasn't overspending in 6 moths time, it was overspending this month!

I like this as it focuses exactly on what you can spend. Whereas checking your balance online or on an ATM tells you nothing. If you have £50,000 as your balance thats useless if your bills over the next week are £51,ooo !!.

I found the set up tricky but i seem to have it running pretty smooth now. I know exactly what i have in each category to spend, my ATB is £0, its all good. Persevere with it at least for the free trial would be my advice, but ultimately it won't be for everyone. I loved it after a few days!!

Just a thought, you are inputting your regular monthly bills (i.e. mortgage) as scheduled transactions aren't you? This means they just pop up on the day due and you just approve them. (i also include the due date and the amount in the descriptions in my category field which helps with forecasting)

FireWyrm

andyfromotley wrote: »

I agree that YNAB isn't much use as a forecasting tool.

I disagree with this. I know what the forums says and how you should not forecast with it, but frankly, you can and I do. We all mostly know that we are going to be paid monthly. We also know that there will be other set income like CHB and TaxCredits for instance. Why cant you forecast those at least a few months into the future. I know that I dont have the money yet, so I dont spend it, but it is useful to see that in 'x' months, if nothing changes and I follow the plan, I will have 'x' amount of money in a given category. It helps you forecast your debts repayments...it was the work of a few minutes to calculate a snowball plan that gives me a debt free date of December 1st and exactly who to pay and when and in what order.

Likewise, I know that council tax will be paid for 10 months of the year excepting February and March. I know that food will need to be bought every month and there are various fixed bills that must be paid. I spent some time forecasting figures for the rest of the year. The way to do this is either pen and paper calculations, or by entering fantasy transactions for those months to get a ballpark figure which you delete later. I have forecast up to Christmas with the proviso that I check that the plan still holds true a few days before payday every month. I check that the amounts being SOd around the accounts are correct and after payday, that it all went through. I dont see much danger in that.

andyfromotley wrote: »

Its all about budgeting for the here and now. 'What do i have available today?" My problem wasn't overspending in 6 moths time, it was overspending this month!

But you still need to know that you have money available at certain times of the year. I know that there is an MOT due in December. I like to have a sizeable pot available at that time, so I forward budget money to that effect. I know that I must not touch that category for anything less than a raging emergency. No, the money isnt available yet, but when it is, it is automatically allocated.

andyfromotley wrote: »

I found the set up tricky but i seem to have it running pretty smooth now. I know exactly what i have in each category to spend, my ATB is £0, its all good. Persevere with it at least for the free trial would be my advice, but ultimately it won't be for everyone. I loved it after a few days!!

To all those upthread who are saying it is time-consuming, I would point out that when it is running and your plan is stable...it is the work of minutes to enter each transaction as it happens. It takes a few minutes every week to reconcile (because you are not reconciling too many transactions) and it takes a few minutes at the end of the month to ensure next month's budget is correct. All in all, I think I spend about and hour each month total actually doing anything with it. Otherwise, it just sits there. Surely, everyone can find an hour or two a month in their schedules to do this and it will pay dividends in the long run trust me.

andyfromotley wrote: »

Just a thought, you are inputting your regular monthly bills (i.e. mortgage) as scheduled transactions aren't you? This means they just pop up on the day due and you just approve them. (i also include the due date and the amount in the descriptions in my category field which helps with forecasting)

There are two schools of thought. Personally, when I started, I calculated the fixed bills and they rarely change value, so I dont bother with automatic transactions. When those transactions happen is irrelevant because I import a QIF file from the bank every week or so which does the match for me. The only transactions I do not enter manually myself are bills - and the QIF contains them so YNAB creates them all for me. After a while, it knows which categories to allocate it to and you need only approve it or adjust as necessary. Every other transaction like buying food for instance, is entered manually.

andyfromotley

Ty wynn

I absolutely agree about budgeting for future expenses, the car mot, christmas etc, that is the whole ethos of Ynab, i just don't use it to say 'ok whats august looking like?'

If i take care of each month, not overspending and putting aside for future expenses then i feel the future will be rosy.

Pixie5740

Don't tell them over a YNAB Towers but I have also used the software for forecasting. :silenced:

I found it especially useful when I was contracting so that I could work out how many and when to take holidays. Naughty Pixie.

FireWyrm

Pixie5740 wrote: »

Don't tell them over a YNAB Towers but I have also used the software for forecasting. :silenced:

I found it especially useful when I was contracting so that I could work out how many and when to take holidays. Naughty Pixie.

Some people can be a little over zealous at YNAB Towers. Also, the Americans are paid differently and have different obligations like local taxes, federal taxes, local sales taxes...you name it. They also largely get paid bi-monthly which is a bit weird too. They have to calculate their own tax and pay it.

Generally speaking, most people in the UK get one payday a month, they have a small number of fixed bills and tax is mostly irrelevant since we pay it up front. The rest of our spending is largely discretionary and can be handled with a small number of transactions. I would use it to run a business for instance, but for most household finance setups, it is more than adequate.

I dont feel in the least that it is dangerous to forecast. Quite the contrary. I think it is essential to know all potential outgoings for the year and what is likely around the corner. For everything else, there is a 'dont know/holding' category for those unforseen expenses. When the MOT is over, if there is any money left, it gets redistributed to other pots that are now higher priority, or if those other pots are well buffered, simply sits and waits for next year.

Elmly

i think forecasting has it pros and cons.

yes i forecast to see how my debt MAY look in 3/4/5/6 months time.

no i dont leave it inputted! i budget as i get the money.

with regards to MOT's/holidays and other one off payments.. i dont feel i need to forecast as each month i put money aside for these. For example, i put £35 a month aside for my car because i know when my tax runs out in December (£200) i will have enough to cover this plus around £220 for MOT/repairs. I also know i am slowly building up my buffer so if i need extra for some new wheels etc i can take from my buffer.