How do you know which account to pay your Credit Card from?
I've seen it written many times that YNAB doesn't care where the money is (which account), but only that you've allocated it to a category.
However, I feel like there's a critical point at which I need to know where the money IS that I allocated.
For example, I have 2 accounts: 1 checking, 1 savings. For simplicity's sake, let's say they both have $100 in them.
I budget $50 to savings, and $150 to my Credit Card spending.
Clearly, that $150 is split between the two accounts. I can't write a check for $150 from *either* account without causing an overdraft fee.
How would I know not to do that? Where can I see WHERE the money is that I've allocated to a budget category?
Thank you in advance for any tips or help on this! :) It is one thing that makes me lose sleep at night...
It's better to think of it this way, the money you want to spend will need to be budgeted towards actual categories (i.e Dining Out, Water Bill, etc). Once the money is spent in that category, the funds will "move" to the CC line in YNAB.
When it's time to pay the outstanding amount, you can opt to pay part from your checking account and then part from your savings.
You may have $70 in checking and $95 in savings but YNAB only sees this as "you have $165". This is a shift in thinking that you'll have to make with YNAB. If you prefer to pay your CC from one account, it's probably better to manually move the funds.
Hope this (kinda) helps, I'm sure there'll be another community member that can explain this more clearly :)
In my opinion if you have only $200 and $50 is for savings...then only $50 should be in that savings account and the rest should be in your checking.
I have a master category called Savings. It has a couple of subcategories of things I am saving for. Every other month of so I check that that master category has an available number that matches my balance for that savings account. For example, I had a couple of hundred dollars in a savings category for Christmas. Since I spent that money I might transfer some back over to my checking to cover that expense before I pay my CC bill on the 31st.
Also, many YNABers have a buffer. (I am somewhat buffered... my two December pay checks will cover everything for January.) As long as I have NO overspent categories at the end of the month I know I have enough in my checking to cover my CC bill (and then some).
If I were just starting I would have most of my money in checking. Pay my CC bill at the end of the month per the YNAB category available number. And transfer over anything I budgeted in savings at the end of the month only if I haven't WAMed from it.
Hope that all makes sense!
Hi, Alice Blue Clarinet
Which account to pay from is a cash-flow question, not a budgeting question. Those of us who choose to use many accounts have an extra step when paying bills and spending. First, we check the YNAB category to ensure we have the funds budgeted for the purchase or payment, then we check the account balance to ensure adequate funds are in the account we want to use.
Before you transfer to your credit account, before you do a cash withdrawal, before you pay a bill, you check the balance in the account you want to use. You can make two payments, as mentioned by pureneon , or you can transfer enough from one account to the other in order to make one payment.
It's the $20 bill in your pocket example. If you have $20 in your left pocket and $20 in your right pocket, but you have to pay $35 for lunch at the restaurant, which pocket is your lunch money in? The answer is both....or neither....if you decide to whip out your credit card for lunch and use the $40 in cash to fuel up your car.
If you are running your main transaction account a little thin, such that it is causing you to have to double-up transfers, you might need to reduce number of accounts or change the amount you leave in your chequing account. I don't like to let my chequing account balance dip below $1,000.