YNAB doesn't carry forward negative balances and this screws up everything

I've been using YNAB since their version 4 Desktop App days, and quite frankly the Desktop App is still my favorite. I have an almost constant problem with the web app version because it will not carry forward negative balances, and this screws up all my tracking.

Yes, yes, I'm well aware of YNABs rules and why they think this is a "feature" but it's not. It's a limitation that doesn't allow one to properly account for reality.

Just about every month, at the end of the month, various bills are due, and when those bills are deducted from the account can vary by a few days, and I don't have any control over this.

Sometimes a bill will be deducted on the 31st but then the next month, it might happen on the 1st. My lease payment is particularly fickle in this regard, but without going into all my personal finances, suffice to say I have a handful of bills for which it is normal for the bill to be withdrawn by autopay either on the last day of the month or the first day of the next.

The problem arises when a bill is taken on the 1st day of the month but then again on last day of the same month. That causes the budget in question to be overdrawn, with a negative balance.

If I don't catch this, YNAB rolls over to the next month, and suddenly none of my numbers make sense. The money listed as available is less than it should be, and....well I this plagued me for months until I realized what was going on, and now I know that after the first of the month I have to go back and change the dates of a hand full of transactions to make this work. This is very frustrating.

There are other realities of life that cause negative balances to occur as well, such as needing food for the weekend, but the months budget is spent, but the weekend is next month, but you have to buy the food today. Again the budget gets into a negative and I have to go manual edit the date to fudge things to balance out.

THIS SHOULD NOT BE NECESSARY. Simply rolling over the negative balance into the balance of the budget in the new month should be normal behavior. This is why we are all a month ahead in our budgets. It allows things to be seamlessly transition from month to month. The desktop app did this correctly. The web app does not and so causes the end of each month to be a constant hassle instead of a seamless transition.

I'm posting here because I have reported this issue multiple times via YNAB support and have been politely ignored by support telling me this lack of functionality is a deliberate feature.

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  • dakinemaui said:
    even when those priorities change.

     So assume my priorities dont change.  Also assume your spend per month is jagged (most spend is).  Say that I dont want to spend more than 1,200 per year

    So back to my original question, I spent 150 for the month.  I'm required by the software to cover the 50 to keep it happy so I do.  What's the best approach to ensure one only spends 1,200 for the year?

    Like
      • Herman
      • herman
      • 1 mth ago
      • 2
      • Reported - view

      mjrudolphi if you are budgeting for the year at the beginning as you previously stated then put $1200 in January and you don't have to adjust every month. 

      Like 2
    • mjrudolphi said:
      What's the best approach to ensure one only spends 1,200 for the year?

      You could set a Spend By Date goal, targeting 12 months out. Set this after you offset the category. Respect the suggested budget entries and "repay" any overspending by spending less moving forward. That was your original plan, right? I don't think that's a great approach (or frankly even very feasible), but again, it's your budget.

      Alternatively, just look at the monthly Average when you budget. If that's under $100, you know you're on track to success as far as that goes.

      Again, I would strongly suggest that you consider that your guess of $1200 you made months prior is very likely to be in error. You just didn't know then what you know today and one of the reasons Rule 3 exists. 

      Like
  • dakinemaui said:
    <sigh> Debt to yourself...

     Isnt yourself better than a bank?  why the sigh?

    Like
  • dakinemaui said:
    Instead of running Restaurants between $200 and -$100 (for example), you would budget an extra $100 (taken from your ample reserves) to the category so the category ranges from $300 to $0. $100 is your new "zero" -- put it in the category name for reference -- and anything less than $100 means you're "behind". When $100 isn't enough to cover things, just reallocate another $100 from reserves to Restaurants, updating the "zero" value in the category name to $200.

     That seems like a lot of work.  What if you have many categories that are jagged (basically all of mine are except for mortgage)? Would I have to do it that way for all of them?   Is there anything else I could be doing that doesnt require renaming categories and the like?  Plus I'm still confused on your process here.  How do I not over spend on a category - is it somehow linked to the changing the categories name or something?

    Like
      • dakinemaui
      • dakinemaui
      • 1 mth ago
      • 2
      • Reported - view

      mjrudolphi Are you really running negatives in a slew of categories that this would be onerous?? At some point, why not just own up to the fact the guesses you made way back when were simply wrong?

      mjrudolphi said:
      Is there anything else I could be doing that doesnt require renaming categories and the like?

      Off the top of my head... Stop trying to carry negatives in a tool that is explicitly designed to stop that practice? Adopt a tool that supports kicking the can down the road like that?

      Like 2
  • mjrudolphi said:
    How do I not over spend on a category

    It's all in your interpretation: you "overspend" by going below the offset amount you dialed in. However, the category is still positive, so YNAB will leave the category alone. 

    Like
  • mjrudolphi said:
    So assume my priorities dont change.  Also assume your spend per month is jagged (most spend is).  Say that I dont want to spend more than 1,200 per year

    The fact you need to spend more than you originally guessed is SYNONYMOUS with a change of priorities. That's what we keep trying to convince you of.

    Like
  • Herman said:
    it's a trivial effort to put fake money in your budget.  If you have 10 categories and you want to be able to go over by up to $100 8n a month without having to mess with your budget, you can add an unlinked account and put $1000 in it.  You don't have to actually take the money from anywhere, it is made up.  Now you allocate $100 to each of those categories and there you go. 

     Interesting.  Not sure I follow 100% so let me see if I understand.  I add a cash account and put money in there - say $1000 like you said.  Now I budget those dollars to the categories to keep from going over each month.  Is that right?

    Like
      • Herman
      • herman
      • 1 mth ago
      • Reported - view

      mjrudolphi just an idea.  Have never done it myself but it would be easy to do.  Now you only have to worry if you go over $100

      Like
    • Herman Wouldnt letting the TBB go negative be the same approach?

      Like
      • Herman
      • herman
      • 1 mth ago
      • Reported - view

      mjrudolphi sure but then you have to deal with the combined issue of is tbb negative because of my spending or I made a mistake moving money etc.

      Like
  • mjrudolphi said:
    Isnt yourself better than a bank?

    Isn't no debt better than debt to yourself?

    Like 1
  • dakinemaui said:
    Isn't no debt better than debt to yourself?

     But debt to yourself is really no debt.

    Like
    • mjrudolphi It's pretending that you have something you don't. Not much difference in my view. Exactly the same as using a fake account.

      Like
  • mjrudolphi said:
    I only allow debt with myself.  Unfortunately I find that hard to implement with YNAB. 
    Any suggestions?

    Charge yourself high interest. That should do it.

    You've got to change the bad behavior first and foremost. YNAB discourages it and builds it into their software. They've got their work cut out with you. 😉

    Like
  • Just want to point out that, if the ultimate goal is to force you to cover any overspend, the negative balance needs to remain negative indefinitely, until such time you put funds towards it at some point in the future.  It needs to be itemized to give you information on where you need to adjust your plans. Carrying forward a positive balance while zeroing out a negative balance only serves to overstate your surplus by the overspend.

    This is especially the case when one has a net surplus at the end of the month. The overspend in one category is buried in the +0.00 overspend for the month. I can't make an informed decision on that information, or I have to dig through months of transaction history. I budget at least 12 months ahead and don't adjust unless there's a consistent pattern evidencing a need to do so. Negative balance rollover + a n itemized Budget vs. Actuals/Variance time series report gives me the information I need. If I have money piling up in one category while a different category is in constant deficit, I know to adjust. I won't rejig 2 years of budgeting for a one-off month. That's counterproductive.

    What's so wrong with providing the user with that information beyond the period in which the spending was incurred? If the idea was to force rebalancing, the transaction needs to be hard-stopped at the point of entry. Such hard stops would be a dealbreaker for me though TBH and would simply fall apart since your iPhone doesn't wait for your paycheck to clear to die.

    One more thing - budgeting is by definition forward-looking, and all entities that engage in this activity forecast both sides of their income statements. Forcing users to budget on cash on hand only distorts the information the tool gives them, and goes directly contrary to the whole point of budgeting in the first place.

    Like
      • Herman
      • herman
      • 3 wk ago
      • 2
      • Reported - view

      Maroon Saxophone Nothing wrong with the way you want to budget but you are using the wrong tool for the type of budgeting you want to do.  

      Like 2
  • Maroon Saxophone said:
    if the ultimate goal is to force you to cover any overspend, the negative balance needs to remain negative indefinitely,

    Not sure how you conclude that; a forever-negative balance is clearly not forcing anything. Did you miss the part where it was taken out of next month's TBB, leading to smaller budget entries next month? "Forced" might be too strong of a word, but it's a pretty effective way to get it done without kicking the can down the road indefinitely. That assumes you don't let next month's TBB go negative. (Not sure that's the case if you're budgeting 12 months ahead, but perhaps you have that much cash on hand.)

    Maroon Saxophone said:
    Forcing users to budget on cash on hand only distorts the information the tool gives them

    Can't agree with that. When my category says $200 Available, it means exactly that as long as there are no red categories (or TBB) hanging around. It's the presence of that negative balance that distorts the amount of cash that's actually available. 

    Certainly one plans with estimates of both future income and expenses, but I don't need to scatter copies of the same numbers throughout the next 12 months. Just from an efficiency viewpoint, editing a bunch of numbers on a bunch of screens when amounts/priorities change is wasted effort when I can fill in the appropriate value shortly before each month arrives.

    Maroon Saxophone said:
    Negative balance rollover + a n itemized Budget vs. Actuals/Variance time series report gives me the information I need.

    Sounds like you need a different tool. Or alternatively, a trial using the recommended practices with YNAB. They are definitely different than what your experience seems to be, but can you honestly say they are less effective if you haven't actually tried them?

    Like 2
  • Lavender Piranha said:
    The red negatives really kept me focused on weak areas.  

    Dwelling on the past doesn't do it for me. My preference is to focus on making do with less elsewhere, which is exactly what covering that overspending will promote. Make a priority-based assessment to identify where to cut back, and take steps to improve the situation. Business/personal is no different in my view.

    Like
    • dakinemaui IDK, is it dwelling on the past?  One specific example  (I can provide more if you'd like) was a vitamin line we had.  The red arrow identified a hole for me, we spent $10k to get them in, I saw sales and thought ok it's working... after a year that $10k started to get bigger, I didn't understand that.  If the budget just zeroed it out I don't think I would have identified the problem and just would have let it coast not knowing there was a problem there.  With time I realized I needed to narrow my selection down to best sellers and not necessarily try to keep a complete line thinking that's what people needed, more choices as things expired, and got replaced it offset the profits.  Instead, we focussed on the best sellers, made a smaller area, and added other products.    Are there other tools that could have helped me with this?   Yes, however, just ONE tool was working well for me for multiple things.  Eventually that $10k was no longer red and I could see how profitable it was.  When I got to $5K of surplus I quite building that category and used the left over to support other areas of the business as that $5k "envelope" now covered any large expense I'd have associated with vitamins whether that was a better display or cashing in on a special offered by the supplier, etc.

      I liked how it worked for me.   I'll continue to use ynab, I just don't like it as much as I used to.  I was really hoping with a thread like this they'd just add a setting for individuals, and I see now that won't happen, I no longer care about what reasons, I usually try to ignore this, but as emails show up and I read them I regretable respond sometimes.  For now it works, as well I'm working on my own app development and I'll leave ynab, at least this discussion thread anyways so I'm never tempted to respond and have some english teacher not understand what I say and try to rip on me.   Glad you look to the future.  My moto?  Remember the past and learn from it, Live life to the fullest, and plan for the future.  The red carryovers helped me to remember the past and learn to make better decisions in the present and plan on building a budget for the future.

      Like
      • Ceeses
      • Ceeses
      • 3 wk ago
      • Reported - view

      Lavender Piranha The other way to do it is to say you spent $10k at the start. Put a goal to recover this $10k in X months starting from $0 Available. If the goal is constantly not met, you know you have an issue. If the category is constantly $0 especially at the start of the month, you don't make any profit. Probably losing money. If the category is growing but less quickly than the goal would like, your profit is less than expected.

      The other thing to realise: one remembers quite well the categories they have to move money into frequently. Even if it's not showing red.

      Like
  • dakinemaui said:
    Can't agree with that. When my category says $200 Available, it means exactly that as long as there are no red categories (or TBB) hanging around. It's the presence of that negative balance that distorts the amount of cash that's actually available. 

     And clearing out the negative balance without an obvious trace to a transaction and dumping it into a fairly useless "TBB" bucket, unitemized, somehow provides richer information? The key here is traceability. There is no acceptable justification in my mind for providing less of it in a piece of software designed to trace your spending.

    Like
    • Maroon Saxophone The primary function of YNAB is to *plan future spending*. Again, "traceability" is focusing on the past. That money is GONE, and the cause of that really doesn't matter. How you react and move forward is what is important. My opinion, of course.

      If pretending you have money you don't is your thing -- because you didn't reduce some category to cover overspending elsewhere or you budget To Be Budgeted until it's negative -- I wish you the best of luck. I also urge you to use a tool better suited to your viewpoint.

      Like 6
  • Brandon, I hear you!!!!! I have tried and tried and tried to like this new YNAB but this feature really sucks. I'm back using my desktop. I sure hope that someday they make this a choice again.  I purchase things for school (PTA) and the reimbursement practically never comes the same month. It is very confusing, adding extra steps, reminders, yadda, yadda. PLEASE YNAB.......make this a choice again!

    Like
    • Hot Pink Motherboard Following the #1 recommended practice, the only on-going effort for reimbursements is to record the transactions. Even if you follow the #2 recommendation, YNAB gives a very clear indication you need to move funds and exactly how much (the category turns green). It's cool you're happy with YNAB4, but for the record (and other readers faced with the transition), this shouldn't have been a show-stopper.

      Like
      • Gozitan
      • YNAB Member
      • Beige_Yeti.3
      • 2 wk ago
      • Reported - view

      Hot Pink Motherboard You can create a debt account as budgetable and move you funds there where you can track. Problem solved. 

      Like
    • Gozitan Losing the Payee field and managing yet another payment category? No argument it works, but in my view, not nearly as well as the recommended practices.

      Like
  • So, I've personally moved past the red arrow arguments a long time ago, but was under the misunderstanding that nYNAB took all overspending from the "To Be Budgeted" for the next month. Discovering that is NOT the case from my current situation and this thread has thrown me for quite a loop, so I just want to understand how, in practice, it would actually work - as it is currently implemented. 

    As an example, If I overspend a category by $50 in August using a credit card, and it is now September 1st (let's assume I incorrectly thought that it would be taken out of TBB):

    1. August still shows an orange overage, if I were to go back and view August. This appears to be the only way to see what was done "wrong" 
    2. YNAB does NOT cover the overage from September's To Be Budgeted, as it would for a purchase on a cash account
    3. YNAB does NOT show -$50 as "Overspent in Aug", as it would for a purchase on a cash account
    4. September's budget view shows no indication that I did anything "wrong", other than the credit card balance in the left sidebar is now off from the credit card "payment" amount - IF I were to compare the two amounts and notice the discrepancy.

    Assuming I did not knowingly set up this odd discrepancy, to reconcile and correct the issue, I would do the following:

    1. I would eventually wonder why after I paid the credit card amount shown in the credit card payment, my credit card balance was not zero.
    2. I would make an "extra" payment, above what YNAB is saying I should do, since I know I should be able to pay off the full amount.
    3. This extra payment to the credit card balance would then turn my credit card "payment" category red for the $50 overage from August.
    4. I would have to cover the "payment" category using another category from September

    Is that the "correct" procedure as nYNAB has implemented it? If so, then a couple of oddities from the past make sense now, at least a little.

    I think there should be at minimum a warning similar to "Overspent from Aug" that should be something like "Debt from August" or "Debt being carried". For that matter, why couldn't a new category pop up similar to the credit card payment category that is "debt payment"

    But mainly, I want to understand how YNAB is intending for this to occur, so I can at least look for the behavior appropriately, to possibly catch mistakes - is the above correct?

    Like
    • Spring Green Tiger You have the gist of it. If you were more observant 🙄, you would see the category did not cover the account balance ahead of time while checking over the budget, reconciling, etc. Failing that, you should be looking at the category before the payment (as with any outflow), would see the shortage, and would move funds in advance of the payment.

      Alternatively, you may have installed the 3rd party Toolkit Extension which adds a warning when the Payment category and account are not matched.

      Edit: Most people make it a habit to look at the previous month around the 3rd or 4th (after all transactions have imported) to correct overspending.

      Edit: After that, your description applies, resulting in an overspent Payment category.

      You may have submitted a feature request to add a summary of both cash and credit overspending in the current month so you have an indication to go looking for it under collapsed categories.

      And lastly, having gotten feed up with the entire situation, you switched to using a checking account to represent your paid in full credit card. This keeps enough to pay the full amount balance reserved behind the scenes at all times. If you by chance miss any late posting transactions that cause overspending (impacting last month), it will be taken out of this month's TBB, where it effectively self corrects... (or is at least more visible...) exactly as you originally desired. 😎

      Like 1
  • Spring Green Tiger said:
    why couldn't a new category pop up similar to the credit card payment category that is "debt payment"

    Because that is already what the CC Payment category represents -- debt payment.

    Like
  • Just one more vote to please allow roll-over of negatives.  I do it manually every month and it's a PITA.  When I do something like pay the annual property tax bill in January or book all my travel for the year in February, I want to keep track of whether I'm holding true to my full-year budget goals.  I don't see why this can't be an *option* for those who don't have a problem with cash flow management but are just trying to keep an eye on overall spending by category.

    Like
  • I wonder if we could just answer this thread with 

    "It doesn't screw up anything" and just leave it at that.

    Like 6
  • Navy Blue Yearling said:
    I don't see why this can't be an *option* for those who don't have a problem with cash flow management

    It's not an option because it is contrary to the methodology. When you pay the Property Tax, that money has to come from somewhere. It would not be a PITA if you simply face the reality that you sent them money that is earmarked for other spending. YNAB doesn't want you to pretend that you still have it.

    Like 6
    • dakinemaui Thanks for the reply.  I totally see why those who are focused on managing cash flow would never want a negative balance.  Do does anyone have any advice on budgeting software that is nice and usable like YNAB, but doesn't require buy-in to the YNAB method?  I see it as the difference between cash flow accounting and accrual accounting - my problem may be that I'm trying to run an accrual P&L on a cash flow tool...

      Like 2
      • dakinemaui
      • dakinemaui
      • 8 days ago
      • 1
      • Reported - view

      Navy Blue Yearling 

      Navy Blue Yearling said:
      those who are focused on managing cash flow would never want a negative balance

       I think it's the opposite with respect to cash flow. Someone who cash-flows is doing the behind-the-scenes "borrow" with the expectation they won't get caught short.  "Managing" cash-flow is heavily focused on predicting when you will receive income (so as to not get caught short). A more accurate description of YNAB is an allocation tool.

      Navy Blue Yearling said:
      I'm trying to run an accrual P&L on a cash flow tool...

      In my view, managing cash-flow is an integral part of an accrual system since you book revenue when you bill. That money usually doesn't show up immediately, but you still have expenses that have to be paid. Ensuring you actually have enough real cash -- i.e., managing cash-flow -- is crucial. In other words, "cash-flow" is not the opposite of "accrual accounting".

      I'd actually arrange the spectrum as "allocation" -> "cash accounting" -> "accrual accounting", in order of increasing amount of abstraction:

      • Allocation deals with actual income + actual expenses (real money all the time). Any negative balances should be corrected ASAP.
      • Cash accounting deals with actual income (booked when received) but will cash-flow (implicitly borrow) for expenses. Negative balances carry forward yielding a plan containing some amount of "Monopoly money".
      • Accrual accounting books income before it's actually arrived and will cash-flow expenses. The amount of Monopoly money in the plan is typically greater (as it includes income as well), mandating even greater emphasis on cash-flow management.

      Hopefully someone will chime in with some alternatives for an accrual-focused tool with improved cash-flow capabilities. Those in YNAB are extremely lacking, mainly because they're just not needed in an allocation system which doesn't mis-represent available funds.

      Like 1
  • Skimmed alot of this, so not sure if this has been mentioned...
    I'm in the boat as many others where before I'd have a (buffer) account with $x,xxx in it incase anything went under $. Plenty of overhead.

    If the new TV goes on sale for 50% off today and I only have $900 of the $1000 I need; I don't want my grocery budget being shorted $100, which only has excess since there are only 4 Sundays this month instead of 5;  nor do I want to wait till the next week when $250 gets added to my fun money account just so I can pay full price for the TV instead, oh wait, wouldn't have enough still then, nor do I want to change my monthly contribution for a blip of opportunity that came up. If only the buffer could (hold) (allocate) the funds, it would of worked instead of having to change everything...

    Trying to do funny math on a fake account I added to temporary inflow into Fun money and outflow from Buffer works, net $0, but then I have to remember to flip it back... no red reminder, as just less in my buffer, not good. If this worked better, as the money is there, I'd love it.

    My new Possible Work Around I'm trying in my free trial before I go back to YNAB4 is:

    Making a fake unlinked account for $25,000k; Pre-adding $1,000 to each of my 25 categories. Voilà, now any category can go negative up to $1,000, not that it would, but it is a nice even number where I can just visually subtract that in my head as I look over my things... Is it worth dealing with it though? IDK yet

    Like
      • dakinemaui
      • dakinemaui
      • 3 days ago
      • 2
      • Reported - view

      Cornflower Blue General if you have a buffer account, put those funds in the budget and in a category. YNAB works best when it reflects reality.

      Your plan to offset categories is effective at letting you track paybacks, but what is even easier is accepting you cannot predict the future with complete accuracy.

      Changing the plan (budget)  to reflect new information is common sense. When you realize it's going to rain, you don't insist on having the picnic as originally planned, do you?

      Like 2
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