Negative "to be budgeted" when getting started


  I'm a few weeks into my trial and am liking YNAB. I imported my May and June payments when I got started (for better or worse I did a month in retrospect) and am struggling with getting the "to be budgeted" to be non-negative. I've been practicing envelope budgeting for a bit, and have money in my savings account from pre-YNAB days that I want to be counted towards the in-progress targets e.g. imagine I had $200 saved towards the $500 car registration fee that's due in jan.

I suppose I could remember that I had $200 set aside and create a "target category balance by date" of $300 by Jan, but that doesn't reflect reality. Similarly I could have a "target category balance by date" of $500 by Jan, but then I'm going to need to budget more than I really need to each month until Jan - I'd much prefer to have a $500 target and indicate that I already have $200 towards it, but when I put that $200 in my "budgeted" column for that category, it leaves me with a negative "to be budgeted" which doesn't reflect reality either.

Can someone suggest how to proceed, please? My goal is to capture these grandfathered savings in their appropriate category and for my "to be budgeted" to be reflecting that I haven't really overbudgeted (because I had this money set aside before I started using YNAB).


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  • Your TBB should never be negative. The goal is for it to be 0. Your savings account should be an on budget account. You should have a car registration category and allocate $200 of your TBB to that category. Your target balance is still $500 by January which means you need to save $500 minus the current category balance (ie $300). 

    So, if your TBB is negative, you either have not added your Savings account to your budget, or you have already assigned all the money in your Savings account to other categories. That’s one of the problems with lump sum savings, you may be double counting the funds. If all your accounts are already set up as on budget and the account registers are correct and reconciled, I would empty all of your categories so that everything is in your TBB and begin reallocating to your categories. When TBB gets to 0, you stop. Seriously, no more allocating. If you want to, you can then use the move money tool to reallocate between categories. But TBB needs to stay 0. The actual reality may be that you don’t have as much money available to you as you think you do.

    Like 1
  • You've suggested exactly the right approach: Use the target category balance by date of $500, put in $200 now -- i.e., allocate some of the money in the savings account toward this purpose -- and the contributions moving forward will be correspondingly less.

    It would appear your issue is that you've already allocated that $200 to some other purpose (category), and therefore it's no longer in the TBB. A negative TBB indicates you've double-booked yourself. This sort of feedback is precisely why zero-based budgets like YNAB are effective.

    Solution: allocate $200 to the Car Registration now and lower one or more lower priority categories until TBB is back to $0.

    Realistically, making these sort of priority tradeoffs is the crux of using YNAB. The actual numbers that you budget come from simple calculations after you've nailed down the relative priorities and timelines. If you cannot free up enough money from lower priority categories (to get TBB back to $0), that's a clear signal that you can't afford to "seed" the car registration now and will have to spread out the difference with somewhat larger contributions across the coming months.

    Do note that after paying the bill once, this "startup phase" will not be an issue. You can spread out the next anticipated amount across the nominal number of months (e.g., 12 for an annual bill).

    Like 2
  • In effect this is highlighting the fact that while you were saving over here on the right, you were overspending over here on the left.  I did the same thing (but missed setting up the existing "savings" to categories) when I started and got a wakeup call about a year later so good for you to catch that. But the experience of YNAB is to make you feel broker when you start ("I never realized it was this bad") but richer as you move forward.  

  • Thanks for the comments, folks. I can now see that my savings balance doesn't cover the grandfathered savings that I'm attempting to capture in my targets. While that is true, it's not the complete story - instead of having cash sitting in a savings account that reflects all the money I've put towards targets I've moved it to temporarily offset my mortgage. Given I can freely transfer that excess back to my savings account when the bills become due, the money is still there. Said another way, I'm using my mortgage redraw (but only the redraw) as a line of credit.

    I'd prefer to have those savings offsetting my mortgage rather than sitting in savings account - are they any ways to have YNAB recognise that the money is there to be budgeted, even though it's not in the savings account?

      • jenmas
      • jenmas
      • 2 yrs ago
      • Reported - view

      Edwin hmm, I know there are threads on here about how to set up the mortgage offset accounts. Perhaps dakinemaui can point you in the right direction. I knew it feels weird, but on these forums it's easier to put all the information out there/bear your financial soul order to get you pointed in the right direction because the fact that you have a mortgage offset account means that the advice you require is completely different than the advice someone without one needs.

    • Edwin said:
      are they any ways to have YNAB recognise that the money is there to be budgeted

      Sure, make an on-budget account -- use a checking or savings account type -- to hold those funds. This reflects the reality that you can spend them so it would be a good idea to include them in the plan (a.k.a., "budget"). Lots of people do precisely this with a savings account, which is typically an account from which they cannot spend directly. In practice, many don't even need to move money back from savings when incurring a "savings-like" expense (e.g., Christmas) because money is fungible. You simply need the account with which you've chosen to pay to have at least that much money. This is not obvious for many people at first glance, so read this blog post.

      Where you go from there with your setup depends on the specifics of your situation. If you have a dedicated real-world account to which you move money, that's functionally equivalent to a savings account (just labeled differently). Just create a savings account with that balance and budget those funds. As described in the linked blog post, move money between accounts when you need/want to without affecting the budget whatsoever -- location and purpose are independent.

      There are other situations where the "additional" funds are a bit wrapped up in the checking account, which is allowed to go negative by that additional amount. A non-US overdraft facility, for example. Such a scenario requires an auxiliary account to inject funds into the budget, which can be gradually sequestered within a category -- effectively removing them from the rest of your spending plans/categories. (Getting off the overdraft is, of course, the goal there. Parking money in order to temporarily reduce your mortgage balance wouldn't need to do that.)

      People who have spoken of mortgage offset accounts in the past have been in a situation that is functionally equivalent to the UK-overdraft setup (i.e., their checking account can go negative). My advice is to reflect real world accounts and transactions accurately within YNAB. Doing so makes reconciliation easier.

      If the above generality doesn't make things clear for your situation, feel free to describe how money moves around in the real world, and I'm sure we can outline a workable approach.

  • Thanks jenmas . I'll take a look around - appreciate everyone's input as I get my head around how to do this!


    is the link that explains how to handle an offset account. 

    Like 1
  • Thanks everyone. After realising how YNAB worked, I thought again about how I was managing the excess mortgage payments and realised that the offset function in my regular savings account achieved the same thing. So I've moved the money that's associated with in-progress goals back out of the mortgage and into the offset savings and now my TBB is hovering just above zero. All the other money stays "off-limits" in the mortgage, but it all makes sense now.

    Appreciate the replies and guidance.

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