Available funds vs overbudgeted
Example: August..amount in checking is $2409. All bills are paid. I have a green "amount to be budgeted - zero". Why?
In September, with all bills due and categories carried over from August, I have a red "minus $474 to be budgeted". Why? There's plenty of funds to work with and cover everything for both months.
Hi, Molly McGuire
The green Zero TBB is the desirable state. It means that every dollar (every penny, actually) has been assigned a job and is sitting in a category waiting to do that job. The job may be long-term savings, or it may be to pay the cell phone bill next week. No red or orange categories and a green zero TBB is Nirvana.
The red -$474 in TBB last month means you assigned $474 more dollars than you had to categories. To correct this, you need to revise how much was budgeted to the categories until you get the number to zero.
If you have exactly $1,000 and you budget $1,474 to categories, this results in an overbudget. The overbudget can also happen if you overspend in the previous month, don't address the overspend, then try to budget your entire income as if it was unencumbered. Now, if you don't correct it, YNAB self corrects by subtracting your overspend or overbudget from any new incoming funds. This is why newbies with an overspend last month will post a question asking us to explain: "my income is $1,500, why is YNAB telling me I only have 1,026 to be budgeted?" The answer is you overspent or overbudgeted $474 last month.
Hope this helps.
Okay. I think I see. I have to say that I really wonder if this program isnt just too overly complex. Im wondering if having the program tabulating the credit debt into the big picture isnt what makes all my numbers seem wrong. would it help if I just got rid of the Visa account and noted the payments in my checking account just like any other bill. It feels like the harder I work at this program (and thats plenty hard!), the more confused and frustrated im getting.
Molly McGuire if you are new to YNAB and feel like it’s overly complicated, I can appreciate the feeling and have learning to do too. I do realize that looking at a completed month as a single learning cycle, it may take 4-6 completed cycles (ie 4-6 months) under our belt before we are old hats at this.
Month 1: what did I just do?
month 2: oh, that’s what I’ve been doing!
month 3: Uhm, maybe this would work better for me...
month 4: yes/no that did/didn’t work at all!
month 5: I think I’m getting the hang of this YNAB approach.
Month 6: ok, I’m definitely a YNAB Jedi Master and ready to start training others in the Ways of the Force!
Keep at it, and Light Sabers out, full speed ahead!