"Total Monthly Goals"
I need to ask a very stupid question as I'm 99.9% sure of the answer..... but since I am using goals extensively, if my Total Monthly Goals is "x" .... and my total expected revenue is below "x", then I have clearly a challenge.... right?
The reason is that I was budgeting previously using Excel and I was balanced in team of envelops target and revenues. But as far as I can see, my base revenues for a month is 2000$ below Total Monthly Goals.... which is obviously means I will end up with a deficit if I meet all the goals.
I read this obvious statement right...?
Depending on why the goals are so high, that might even out over time. Semi-annual & annual bills may need lump sums if you haven't been saving up a portion each month.
For example, if I have to pay 600 for car insurance this month (and will have to pay that again in 6 months) and am budgeting 600 for it this month, then next month I can start saving 100 a month towed the next bill in 6 months. That would bring my goals down by 500 a month! I could then use that to catch up with another big bill & get everything on an even budget (1/6 of 6-month bills or 1/12 of annual).
You might need to reduce some goals for now or find ways of earning more income in the short term. 2k is a big difference between what you want to spend & save each month & what you earn. Can some optional goals have their time frames extended or total amounts reduced? Any categories you can get rid of entirely?
If you are budgeting based on an average of total annual income, but get some in lump sums like bonuses or have variable pay, you might need to cut back until your next lump sum or higher paycheck. The extra should go into a Deferred Income category & be filed out a little each month to bring you closer to your average.
TL;DR: There are lots of different reasons your budget could look like this. Now that you see the difference between your goals & income, use that info & YNAB's Four Rules to make your budget match your reality. This blog post on budget templates may help: https://www.youneedabudget.com/how-to-create-a-budget-template/Reply
Welcome to the real world where nobody can have everything they want. 🙂
I'd say push back timelines or reduce scope (amount) on lower priority goals until the total is in line with your income. This is the magic of YNAB -- you'll develop a sense of relative priority, and your spending will gradually become aligned with those priorities.
As adriana01 indicates, as you get past the "catchup phase" of various true expenses, the reduced contributions will allow you to put money toward lower priority things that initially had to wait. It's also worth looking at the total "nominal" amounts (assuming all catchup phases are over, so 1/12 of annual bills, etc.) just to see if your desires are feasible even in the long term.Reply
Eric Poulin said:
I think I have aligned all my goals the way I had done it in Excel (Getting a yearly number / 26, which is the number of pay I have).. I had adapted that to YNAB as it works on a monthly basis.... so that yearly number got divided in 12 and these are now my various monthly goals.
I'm guessing right here is why it feels like your goals that used to make sense are seemingly now outpacing your income on a monthly basis. You haven't factored in those two "extra" paychecks per year.Reply