
How to Remove Savings $ from To Be Budgeted
Hello,
I have researched the forums, support, youtube, etc and I can't figure out how to manage my savings transactions. I understand assigning jobs for your savings money, but once I have done that, I don't know how to have that money deducted from my to be budgeted. For example, let's say I started with $100 in my savings account when creating my budget. In my budget it now shows that I have $100 available in that category. I essentially want that money to be "unavailable" to me because I am trying to build an emergency fund and contribute to it each month. I don't want to confuse myself into thinking I have money available when I am trying to keep it in savings. Please help!!
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Budgeting money to a category deducts it from your To Be Budgeted.
When you budget money to a category, it stays in that category until you spend it. So saving money in YNAB is just budgeting it to a category and then not spending it.
I have all sorts of savings categories in my budget, for things that we don't plan on spending anytime soon. 2 different car purchase categories, home maintenance/repair, car maintenance/repair, home improvement, vacations, next year's IRA money, lifecycle events, home improvement, and of course income replacement.
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Ok, but now I have moved this money over to a physical savings account, but it's being accounted for in a line item under my ynab categories. So something happens and now I need to bring that money back in. When pulling in my bank transactions, it's going to show $X coming into the account to be budgeted, but it won't have taken it out the category where that money has been accounted for in categories. Seem like it should be more like a credit card in terms of transfers, and should I need it I transfer it back into the checking account, but it doesn't seem to work that way. I just don't know how to account for that money that won't be completely messed up if I have to move it back in.
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Is your savings account part of your budget or a tracking account that is not part of your budget?
When you keep your savings account as part of the budget, the act of budgeting money to a category is what saves the money. Moving it to a savings account (or back to a checking account) is just moving it to a different account within your budget. If you need to spend from one of your savings categories, you can spend from the checking account if there's enough money without having to manage anything in the budget. A transfer would only be needed if you needed to move the money into the checking account. Or to put it another way, when all of your accounts are part of your budget, all of your categories live in all of your accounts. The location doesn't matter, and so no categories are required on the transfers between accounts.
Read: The Relationship Between Your Budget & Your Accounts: It’s Complicated
If the savings account is off-budget, then the transfer is categorized and is treated like spending. You won't see the category balance accumulate. You'll also have to categorize when you bring the transfer back on. And then a third time when you spend the money. This will turn your Income and spending reports into a mess and it'll be harder to track your actual spending from those categories.
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This was tricky for me as well. I could never get my savings account right.
After about 8 months of toying with it all I got frustrated but stumbled across these videos - https://www.youtube.com/watch?v=IMVYIgq_K8w&app=desktop
I followed both concept without fully understating out why it worked After three months of using the suggestions in the video it all started to make sense.
To test it out make a Budget Category - “Emergeny Savings” if you have any money marked for emergeny savings set the current month budget to the value plus any additional contributions this month. Next month you’ll see your money is green - makes it look like your budget is green and spendable. But here’s the discipline - it’s spendable - but only when an emergency arises. So watch it grow green and higher every month as you set each months contributions do nothing else in YNAB except approve your transactions (which should be transfers) and remember from the video the budget doesn’t care about transfers. “The budget only tracks when it comes in and leaves the palace.”
I was saving for new windows and plumbing work. For several months (14) I contributed to my “Home Repairs” budget and we watched it growing green and greener. Then one day the balance read zero. But never red!
I hope this helps
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This thread has been useful, but I really wish YNAB would not be so dogmatic about saying it doesn't matter which account money is located in and actually support a way of showing transfers in the reports so I can see my spending as a % of total income, including money I choose to save.
Accounts ARE important. I have two savings accounts, one at the same institution as my checking account (emergency fund) and another at a much smaller institution that offers a much higher interest rate (for a future all cash house-purchase). It's easy for me to assign the jobs as all of the money in each account has a single purpose, but I don't want to keep a 6=figure sum of money in an account with 0.01% interest rate, but a few thousand dollars emergency fund is fine. It also takes 3 days to transfer money fully from the external account back to my checking, so I really want my emergency fund to be instantly available if needed.
What would be great looking at my monthly reporting would be seeing $x,000 in a month contributed to savings and be able to track that as a % of my total spending. As things stand, the amount is always zero as it is a debit from one account and a credit to another. Banktivity on the Mac does actually show this quite nicely, simply by exuding an account from the budget, so transfers to it become a 'spending' category. I am sure the feedback will be I am old fashioned and don't get it (probably true, I work in Finance) but as a person with no debt aside from a mortgage, I've done quite well with my system so far.
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Woolloomooloo said:
Accounts ARE important. I have two savings accounts, one at the same institution as my checking account (emergency fund) and another at a much smaller institution that offers a much higher interest rate (for a future all cash house-purchase). It's easy for me to assign the jobs as all of the money in each account has a single purpose, but I don't want to keep a 6=figure sum of money in an account with 0.01% interest rate, but a few thousand dollars emergency fund is fine. It also takes 3 days to transfer money fully from the external account back to my checking, so I really want my emergency fund to be instantly available if needed.It's not dogma. It's the truth. The account does not matter for the purpose of holding your money. An account has no purpose other than to hold money. Your categories give purposes to your money regardless of location.
Yes, the account matters for spending your money. So just keep an eye on account balances and have awareness of large upcoming spending, and understand transfer times (which YNAB has no awareness of. It's not difficult.
I have 3 cash accounts, 1 checking account, 5 savings/money market accounts, 8 credit cards, 4 gift cards, 1 commuter card, 7 CDs and 1 TreasuryDirect account in my budget (currently). My checking account has 5.3% of my budget money. The account truly does not matter.Also, the best way to manage transfer times in an emergency is a credit card that's not incurring interest. The 3-7 week grace period is more than ample enough to cover a 3-day transfer time.
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I have read all the posts and I too am very frustrated by this process. I have been laid off, twice, in the last 10 years and while I put money aside for those type of unknowns, I DO NOT want that money to be considered "available" in the header of my budget. I really want to keep track of all my finances here, but I have gotten to the point I am not going to allow YNAB to track my savings and what I put aside as YNAB makes it looks like I have $15K "available". Very frustrating. Maybe I am just being too inept and don't know how to use the software for these types of things. I wish there was clear, usable, guidance on this and how I need to manage my savings.
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Then I must be doing something grossly wrong, or YNAB is not designed for what I want (not a complaint), as my TIAA savings is showing up in the "header" of my budget for the month and I just don't want it to. I will just remove my "savings" from the YNAB categories as there doesn't seem to be a way to include something as an "off line" (off limits) account. Sorry, but some of the replies are a bit firm and I don't want to belabor my question. Have a great day, Derek
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I think the easiest thing is to have your $100 get put in your savings account automatically by your employer. Then you set up an automatic transaction to represent that, and categorize it towards your emergency savings category, instead of TBB. You'll never see it in the budget, but the activity for that category will show its growth. Is that what you're trying to do?
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Hot Pink Yeti said:
I've tried the YNAB way (assign amount in my savings account to the savings categories), but it never seems to add up correctly.How long have you been trying to ignore the fact that categories don't add up to account balances? If it's only been a couple of months, I'd encourage you to keep working through the discomfort of seeing your finances through the different lens. Because I can tell you that it bothered me quite a bit in the first year of using YNAB - not constantly bothering like a tooth ache, just a recurring nagging worry like a mosquito hum in the dark, something that I'd have to slap away in order to keep moving forward. It finally all just clicked solidly into place by the end of the first year.
I had been budgeting by account for literally years, so I think it took me that long to "unlearn" budgeting by account, and......I think, to be entirely honest, it also took me a while to be completely confident in the YNAB category method. Now, you couldn't pay me to go back to matching categories to accounts.
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I think the bush we are beating around here is that YNAB has all of the data it needs to track savings budget items by actual account and that there are real YNAB relevant reasons for having multiple accounts. Yes, budget simplicity is budget stability, so you could have 1 account to rule them all. This is a financial fallacy though once you have your budget under control. If you are truly saving money not saving it in high interest savings is wasting your resources. I might as well make a cash savings category called "Under my Bed" and a non-linked account to track it. I can go grab the money anytime and spend it, sure, but it is not doing it's job of building my wealth even though it is accurately budgeted.
Likewise if I have my savings category spread across 2+ accounts, say a checking and a savings which may even be same institution and instant transfer capable, YNAB requires unnecessary diligence to make sure I don't make that emergency expense from an account that only partially contains the budget.
99% of the time a budget item should not be account specific... but transactions ARE account specific and so the ability to have account specific budgets while ALSO tracking total budget across all accounts is about the only feature I think YNAB lacks at this time. I also think, despite my 1% need estimation, that it is a CRITICAL feature for maximizing your true available budget. Heck, just being able to designate portions or entirety of a category budget value to a specific account can help raise the red flag immediately if you say, should have used your rewards card to make that gas purchase but used your debit card instead. You just threw 3-5% down the tank and preventing that is not outside of the goals of YNAB. Every dollar has a job including making you more money! Any dollar in a savings category not making you money has no job until the day you need it, other than to add to your Age of Money and security.
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Thank you for letting me know about the Toolkit extension! The running balance certainly captures the information I need in regards to scheduled/expected transactions. I still believe that it requires unnecessary brain work if you (despite the article's insistence that having more than 1 account doesn't make sense) maximize your money buy purchasing/holding money in multiple accounts. I can definitely say with confidence that, for example, groceries will always come from Checking A and gas will be on Card B, etc. Even so as I type my thoughts I find myself deleting them and thinking that this is a fairly obscure requirement and likely involves me trying to optimize my money too much.
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I am sure people feel this topic has been done to death, but I think there are two standout reasons the "it doesn't matter where your money is" approach doesn't work for everyone.
One of the first things I always check in my regular financial software (which has been typically either Quicken or Banktivity), and have done for the last two decades, is post all of my upcoming bills for the month, at least between pay periods, so I know that I have enough money in my checking account to fund them without going overdrawn. Overdrawn = penalty or interest or both. For a long time, this was my number one concern. This is just a case of looking at what the balance is when everything is paid, it's not even a question of budgeting.
With YNAB, you at least don't have to worry about funding CC payments, because the software does that, and I love that feature. Spent money on a CC is spent money period. Awesome. But if you have you "to be budgeted" money in several places, you may not see you're about to go into debit on a specific account, after a certain bill is paid from that account.
OK so now the argument is, well why have more than one account anyway? If you're living paycheck to paycheck, or are just starting out with budgeting, then having one account makes a lot of sense and makes things easier. The challenge comes when you have your emergency fund, you have enough to cover those repeating "one off" expenses, and you start accumulating money that you don't need now or even in the medium term. OK, so open an IRA and take it off budget? Sure... that might be good advice if you know you won't need it for 30 years... but with interest rates creeping up, and market volatility becoming more likely, maybe you just want a safe heaven for your cash where you can earn some interest while you're at it.
All of these financial apps have limits. Quicken's budgeting was always woeful (and still is) as is Bantivity's, but account management in both of those apps is pretty strong, as is reporting. It's actually quite difficult to do both well, because reporting on transfers and aggregate balances isn't necessarily easy because you can't predict how people use there accounts.
What I think would be a good feature on YNAB, is to be able to budget and additionally track transfers as an option. So if I budget $1000 a month for "rainy day" and "rainy day" is in an interest bearing account, that I can track that in the same way I would an expense. If that feature were available, I would use it, and it would save me a little faffing about each month.
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Hmm I think I have the same problem. (Sorry if someone wrote this already, i didn't read all the posts) What I do is keep (very) long-term savings off YNAB. If during a month I saved money by e.g. not spending my monthly 60$ on books i put it in a savings category until i send it to my savings account. What I do then is substract the amount saved to my last income (i did not sync YNAB to my bank accounts). I am left with over budgeting by the amount of savings. I do a quick transfer from savings to to be budgeted to have the latter balanced to 0. A bit weird but better to me than entering a spending transaction when it's in fact long term saving (don't want to spoil my AOM ;)