A good budgeting app???

molerat

Money_Muppet wrote: »

......... I've gone from spending on credit cards every month for as long as I can remember, to not spending a penny on them since August..........

"Spending" on a credit card and "borrowing" on a credit card are 2 entirely different things. I get paid 3 times a month so my spending could get ahead of my pay, a credit card can be a useful budgeting tool. Things like tyres come out of the car maint budget, paid for on the cc for cash back, the value transferred across to the spending budget which pays the card bill. The bottom line remains the same and at the end of the year I will get a nice little bonus of £200 for spending their money.

Money_Muppet

molerat wrote: »

"Spending" on a credit card and "borrowing" on a credit card are 2 entirely different things. I get paid 3 times a month so my spending could get ahead of my pay, a credit card can be a useful budgeting tool. Things like tyres come out of the car maint budget, paid for on the cc for cash back, the value transferred across to the spending budget which pays the card bill. The bottom line remains the same and at the end of the year I will get a nice little bonus of £200 for spending their money.

Spending and borrowing on a card are different, you are correct. I mean to say I have not spent money I do not have on a credit card since I started YNAB. I have bought things on a credit card to get certain protections etc, but the money has always been in the budget to cover that spending.

If you are spending on a credit card before you have the money to cover it, you are borrowing money. YNAB (sensibly imo) doesn't encourage that. It doesn't do forecasting, it just tracks the money you have. If its not available in the budget, don't spend it. I've had to move money around categories in certain months, but not once have I spent more than I have (so far). It's a pretty fundamental aspect of YNAB (and budgeting).

copperjar

OMG Money_Muppet, thank you! I think it might be sinking in!

Have also finally watched the savings tutorial (couldn't find it at first!) and I think my problem has been catogorising the spend, then spending it - therefore recording 2 payments for the same thing!

hohum

timbstoke wrote: »

I agree, but your budget has to work around you, not the other way round. YNAB is designed around monthly budgets. If you get paid monthly, or have already built your buffer fund enough that you budget monthly and your payday is a mere irrelevance, then it works brilliantly well.

But I get paid every 4 weeks, and I'm still living payday to payday. That means I find myself running a separate mental budget to try and reconcile YNAB with the realities of my bank account. "I have £300 in the budget for groceries in December, but I can't do a big shop yet because I don't get paid until next week".

I also don't like the way YNAB keeps everything in one place. For my day-to-day budget, I only want to see the things I can actually budget - "I need some new jeans, so I'll have to skip the pub quiz this week so I can afford them". My rent isn't part of that budget, and I don't want to see it there. I want it on a completely separate sheet, already pre-entered in the ledger for the entire year, so I don't have to concern myself with it.

This is primarily why I've gone back to Excel. My Excel budget runs payday to payday, so it's on the same wavelength as my real life. It keeps all my fixed bills out of the way, and deducts them from my income automatically so my budget dashboard only shows me what I can actually spend. It's designed around the way I look at my finances, so it shows me only the things I actually care about, which suits the way I work. It's not perfect yet, but it's evolving, and that's what I like about it.

I have to disagree re YNAB only working for people who have monthly pay/ people who already have a buffer. We have a very variable income - my partner is self employed. When we started YNAB, we were in a very low earning month. It was a bit hellish, but it has revolutionised our finances.

This also stood out for me: "I have £300 in the budget for groceries in December, but I can't do a big shop yet because I don't get paid until next week". If you were putting money in the budget that you didn't have, you were not working with one of the first principles of YNAB which is to only budget the money you have available right now. Otherwise, as you say, you have to keep track of things. The money available to your budget in YNAB should match the money available to you in real life.

Of course, you have found an alternative solution and sounds like you are happy with it! I just wanted to point out for other readers that the issues you raised are quite common with starting to use YNAB ( I did exactly the same thing of budgeting everything out for the entire month, without having the money to fund it) , but are about using the software as intended. That's the crucial thing to make YNAB work, is to let go of preconceptions about what budget means, and systems that have been used before. If you can fully invest into the software and the method, it really is very powerful.

getmore4less

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That is not budgeting that is cash flow management

happybunny86

getmore4less wrote: »

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That is not budgeting that is cash flow management

I think that's the crux of the problem. We all spend ages doing the perfect budget but quite often life throws a spanner in the works and we give up as soon as we've overspent in one category. The ynab philosophy of roll with the punches means you have to 'budget' where you are spending less to make up for where you had to overspend based on the cash you have now.

hohum

getmore4less wrote: »

^
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That is not budgeting that is cash flow management

Does it matter?

I am sure there are people who find estimating what their income and expenditure will be to be useful. I do to an extent, but it's not as transformative from a personal budgeting perspective as working with actual income and actual expenditure.

Particularly for me I always found usual budgeting wisdom to be frustrating mostly because our income varies so widely. There is no typical month for us, we have varied between £1300 to £4000 in monthly income. So expecting always to keep to the same monthly budget was not practical.

A budget can also be a description of what you plan to do with your money. What I like about ynab is that the plan is factual.

greensalad

katejo wrote: »

Which aspect did you find difficult? It is true that you need to attend their class or watch the video for some aspects (eg. credit cards). However, once you have done that, it is simple to use. I started in August and intend to continue.

I couldn't for the life of me make it balance out my previous month. It explains that the point of it is that you start from "now" and don't worry about the past, but I couldn't seem to make it understand that I was overdrawn in a current account (it kept telling me that account should be in the positive). I wanted to start it so it said "January account balance = £1000" and then set up all my outgoings. But it couldn't do it. It kept telling me I had minus £2500 or something

I'm back to my own budget sheet. I keep utilities in a big budget sheet that shows how much me and my partner need to pay in monthly. I tick off items when they go out of our utilities account. And it also auto-sends reminders on our payday with how much we need to pay (my partner never logs in, but waits for the email and then pays it in). It handles everything. Our rent, household bills, even our music and magazine subscriptions.

That same sheet ties into my own personal budget sheet. It shows key areas I need to spend in, shows my debt repayments and shows me how much "disposable" I have left. I am working hard to balance that "disposable" income now and will probably make another spreadsheet later in the year which handles dividing up the "disposable". For now I use Money Dashboard to highlight key areas where I am overspending.

And then that spreadsheet links into my final spreadsheet. It takes the values from the monthly debt repayment, works out the monthly interest and shows me when that account will be paid off.

getmore4less

hohum wrote: »

Does it matter?

I am sure there are people who find estimating what their income and expenditure will be to be useful. I do to an extent, but it's not as transformative from a personal budgeting perspective as working with actual income and actual expenditure.

Particularly for me I always found usual budgeting wisdom to be frustrating mostly because our income varies so widely. There is no typical month for us, we have varied between £1300 to £4000 in monthly income. So expecting always to keep to the same monthly budget was not practical.

A budget can also be a description of what you plan to do with your money. What I like about ynab is that the plan is factual.

Longer term it does matter, the budget/plan is the key,

Conventional budgeting is not every month is the same*, but at least a year in detail with longer term 5y 10y+ factored in.

It is all about prioritizing the allocation of the resources.

The second part is tracking you are spending as planned,
Agree for many it is the spending diary and tracking that triggers the LBM to begin the planning, you can't really make changes till you know where your money goes, it is critical to transition from the cash flow tracking to a more mature budgeting and planning.
If the tracking is showing your plan was wrong adjust the budget/plan become reality.
You match you priorities to reality or adjust reality to match your priorities.

Variable income is a cash flow issue it just determines the order you can get stuff, the good month provide the buffer for the quiet months, the plan should include a timescale to de-couple the income from the outgoings.

With the budget/plan you work on worst/low case income scenario for the essentials, adding discretionary and long term saving items for when the income exceeds the low case.

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* no one has a standard month, spends are daily, weekly, monthly or other frequency, a year covers most things as long so is the best period for most people to use when planning/tracking.

tea_break

How much time do you need to spend on average keeping your YNAB records up to date? Do you need to use it every day and record all your spending for different categories? This Christmas has shown me it's too unreliable budgeting on a 'back of an envelope' type system and I overspent a bit so I need to look at something a bit more systematic.