1st of the Month payments, when 1st is on weekend or holiday

Been searching on the best way to handle this in YNAB, as I'm fairly new to using it.. but here's my scenario that I imagine has to have come up for many...

I have a Mortgage and Car payment that I have set up recurring automatic transactions through my bank to pay these bills on the 1st of each month.   I'm budgeted a month out so I have funds.  But this month, my December 1st payment will be sent on November 29th because the 1st lands on a Sunday.

If I log that transaction on November 29th, it applies to my November budget and I still need to "meet" my December goal for those bills.  If I log it with the incorrect date as December 1st, the budget is accurate, but the transaction date doesn't match the bank date.

How do y'all handle this situation?  I think it's easiest to just change the transaction date to the 1st when the bank feeds the transaction over, so the budgets look right in the correct months.. but is there a better way?  

Alternatively I could leave the transaction as  November 29th,  the negative number will show in my budget for those items in Nov. since I "overspent", and then just re-allocate those dollars for those budgeted items to something else or throw them back into "to be budgeted" I suppose... but seems a lot easier to just change the transaction date to the 1st and worry about the "date discrepancy".

Any best practices here?

50replies Oldest first
  • Oldest first
  • Newest first
  • Active threads
  • Popular
  • The transaction should be dated in November because that's when it happens. Therefore the funding needs to be available in November as well. Just ignore the goal nag in December.

    Like
    • jenmas In this example then:

      I have a $1000 Mortgage payment.  I budget $1000 on the 1st of each month.

      • November 1st, I pay my $1000.  My goal is met for November.  My Available amount goes to zero.  Perfect.
      • November 29th I pay another $1000 for the December mortgage.  My "available" funds for November for that category show <-$1000> and I've overspent for November.
      • In December, I still have a goal o f $1000 on the first for the December Mortgage, but I can remove any budgeted dollars I have for that category because it's already been paid

      So I could either (Option 1) just ignore that my goal was underfunded in November, and remove my funding for December...  or...  (Option 2) I could just fund another $1000 toward that goal in November so it is funded out of the correct month, and don't fund anything for that goal in December, because it's already been paid.. 

      Talking through it now, I think Option 2 is the most accurate way to do it on those few months a year where the 1st of the month payments go out a few days early.

      Like
      • jenmas
      • jenmas
      • 11 mths ago
      • 1
      • Reported - view

      tonybrown32 yes you must ensure that you have funded a total of $2K in November because that's how much you are going to spend in November.

      Like 1
  • I agree with jenmas . I'm definitely in the 'don't try to fudge reality' camp.

    Goals are just aide-memoires after all.

    Like
  • For the occasional instance, I just let the scheduled transaction stay dated on the 1st. The money is there all the same. Doing anything else is just needless busy-work at that point. This approach probably doesn't work well if you import (I don't).

    If you routinely pay early (e.g., you have to mail a check), I'd switch to making money available at the end of the month as a matter of course.

    Like 1
    • dakinemaui Thanks.  I do use the imports, so that's where things get wonky... You are right, the money is all there just the same, more of a book keeping concern than having the funds available.

      Like
      • dakinemaui
      • dakinemaui
      • 11 mths ago
      • Reported - view
      tonybrown32 said:
      I have a $1000 Mortgage payment.  I budget $1000 on the 1st of each month.

      Potential issue here: If you actually receive the money for the Mortgage payment on the 1st as well, then the Goal is the least of your worries -- you don't actually have that money Available if you have to pay it early. In that case, I would definitely shift funds around to reflect that they are no longer available for other things in the budget (because you sent them off to the mortgage company).

      In fact, after you do that, you may consider switching the categories you normally budget on the 1st to include whatever category(ies) from which you reallocated for the mortgage money. Whichever check you used to use for those categories can now go toward the Mortgage. That way you never have to worry about this issue again.

      In my case where I said that I don't sweat adjusting the dates, I have already received all of next month's money well before any potentially early outflow due to weekend/holiday occurs.

      Like
    • dakinemaui Ahh.. I see what you mean, my description wasn't totally clear...  I budget to make my payment on the 1st of each month.  I budget ahead, so I have the funds available.

      Agree though, I'd have a lot bigger problems if I didn't have funds until 3 days after the payment was due!  Luckily in the same situation as you, where I've already received all of next months money, so making a payment a few days early isn't going to be a problem.  :)

      Like 1
      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 11 mths ago
      • 2
      • Reported - view

      tonybrown32 In this scenario I approve fudging the date.

      Like 2
  • But this month, my December 1st payment will be sent on November 29th because the 1st lands on a Sunday.

    I've honestly never experienced this. If the normal payment date is a Sunday or holiday, it will be deducted the next business day (not earlier).

    Like
      • dakinemaui
      • dakinemaui
      • 11 mths ago
      • Reported - view

      Matt T My experience has been consistently to pull early. (I'm in the US, which may be a difference.)

      Like
    • Matt T My bank adjusts the payments earlier when the scheduled date is a Sunday/Holiday so that the bill payment isn't sent late.

      Like
      • Matt T
      • matt.1
      • 11 mths ago
      • 1
      • Reported - view

      tonybrown32 Oh gotcha, that makes sense. I'm in the U.S. also but I've never setup my bank to make automatic payments (I typically just pay the provider directly).

      Like 1
      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 11 mths ago
      • 2
      • Reported - view

      This is why I do pulls instead of bank bill pay. Pulls usually occur on the next business day.

      Like 2
    • nolesrule Yeah, I think I need to look at how I do my transactions with some of my bills... My Mortgage is the outlier...  I have it through our old credit union we used to bank with, and I now changed banks...  It's a mess trying to keep up with multiple accounts, and that old credit union is not great with electronic transactions.. another reason we left.

      If I have a checking account with them it's great, but bank to bank transactions between accounts were taking 5-7 full business days... and they don't have an "electronic" payment option for my mortgage payment.. can either send them a check, or transfer funds from your credit union bank account.  So I just send an e-check through my current banks bill pay system.. 

      Like
      • Superbone
      • YNAB convert since 2008
      • Superbone
      • 11 mths ago
      • 1
      • Reported - view

      nolesrule One doesn't always have that choice like my HOA payment for example. They don't have a pull system so it's the one bill I have to use an automatic bank pay and it acts like the OP issue and pushes it early when the payment falls on a Sunday or holiday. What I sometimes do is modify the bank payment into the first available day in the following month since there's a grace period on the payment.

      Like 1
      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 11 mths ago
      • Reported - view

      Superbone In the case of something like that I just found it easier to set the date a few days early every time, and just set it and forget it. The problem with the bank push is they often mail a physical check, and you don't want to ever be late with the HOA.

      I'm still trying to track down what happened to the money I paid to the HOA at closing on the new house, because the closing attorney didn't send it to the management company.

      Like
      • Superbone
      • YNAB convert since 2008
      • Superbone
      • 11 mths ago
      • 1
      • Reported - view

      nolesrule My bill pay makes all payments on the date it's set up for. If it's a paper check, it arrives on that date. My HOA has a 15 day grace period before a penalty fee kicks in. After reading your suggestion, I thought about going the other way and setting up all payments on the 4th of the month. But then thinking about it more, why be intentionally late when I don't have to be? 3 or 4 days of interest on a smallish amount of money isn't going to make much difference in the long run. I just changed mine to the last day of the month instead as you suggested so the payment now will ALWAYS fall in the same month going forward. Of course, there are only 30 days in November so I'll have to go back in next month and set it for December 31 and then I'll be set.

      tl;dr Thanks for the suggestion! 😄

      Like 1
      • dakinemaui
      • dakinemaui
      • 11 mths ago
      • Reported - view
      Superbone said:
      just changed mine to the last day of the month

      This has ramifications since you're on Classic Rule 4. You just unbuffered yourself, amigo.

      Like
      • Superbone
      • YNAB convert since 2008
      • Superbone
      • 11 mths ago
      • Reported - view

      dakinemaui I beg to differ, hombre. 🙂 Only requires a one-time usage of Rule 3. Bang! Back to fully buffered. I will see you on Main Street at sunrise.

      P.S. Didn't even require that. Turns out I already had an extra payment sitting in the category. This has already happened a couple of times this year. I must have rolled with the punches at the time and then continued to meet my monthly funding goal. Cool, extra funds for December!

      Like
      • dakinemaui
      • dakinemaui
      • 11 mths ago
      • 1
      • Reported - view

      Superbone Sooo, you were unbuffered (ignoring your PS, which shouldn't have been the case if you'd been more on the ball, lol) but were fortunate enough that you could defer something else and reallocate to restore the full buffer. 😉

      As for the P.S... congrats on having a larger buffer than originally needed, which was fortunate since now it's just the right size. Cheers!

      Like 1
      • Superbone
      • YNAB convert since 2008
      • Superbone
      • 11 mths ago
      • 1
      • Reported - view

      dakinemaui Dude... I have a Freedom Fund category that is approaching the size of my 6 month Emergency Fund. (That's what 10+ years of YNAB will do for you.) It's not going to be an issue for me. 🙂

      But I appreciate the theoretical conversation as this is a teaching forum and could be an issue for somebody just starting out or living on the edge. Cheers!

      The lesson here is that one would need to do a one time roll with the punches to move a monthly payment from the first of the month to the end of the month.

      Like 1
      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 11 mths ago
      • Reported - view

      Superbone Is that your on budget investments?

      My taxable brokerage account is now 2.4x my income replacement fund. If I decide to eliminate the income replacement fund, then I'd have to move my Treasury Direct account into my overall asset allocation. That would kill my AOM, though not nearly as much as selling/buying a house does. 🤣

      Like
      • Superbone
      • YNAB convert since 2008
      • Superbone
      • 11 mths ago
      • 1
      • Reported - view

      nolesrule Come on, man. Like you really care about AOM. It's dumb. It's just silly numbers at this point for us. I'm not tracking it anymore after this year.

      To answer your question, kind of. My taxable Vanguard account is on budget but all the funds are currently invested in the treasury money market fund you turned me on to. It is currently over 4x the size of my 6 month fund but of course includes it.

      Like 1
      • WordTenor
      • I have the honor to be your obedient servant
      • WordTenor
      • 11 mths ago
      • 2
      • Reported - view

      Superbone  I am totally recording that use of "dude" for my class, who always get very interested in the discourse applications of "dude." 

      Like 2
      • Superbone
      • YNAB convert since 2008
      • Superbone
      • 11 mths ago
      • Reported - view

      WordTenor Ha ha. Be my guest, lol. I live in California so I get first hand experience with all the shades of "dude."

      Like
      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 11 mths ago
      • 2
      • Reported - view

      Superbone But but but, at the end of July, my AOM told me I had like 300 days of buffer, and then at the end of August it told me I had 173 days of buffer, but the amount of money changed by like 1%. 😉

      Like 2
      • dakinemaui
      • dakinemaui
      • 11 mths ago
      • Reported - view

      nolesrule bummer, dude

      Like
      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 11 mths ago
      • Reported - view

      dakinemaui Totally. 

      Like
    • Superbone that's exactly what I did last night.  I just moved the payment date to Dec 3rd instead this time, since I have the grace period... I dont want to lose my buffer right now, but eventually need to try and move a couple things to the end of the month before they are due.  Hate the couple things that are due on the first... lol.. 

      Like 1
      • Annieland
      • YNABbing every day since 2009!
      • Annieland
      • 11 mths ago
      • Reported - view

      Superbone Wait a second. So THAT'S how you guys have these insane AOMs??  My income replacement fund is only barely 3 months, but I know I have enough cash and equivalents scattered about in off budget investment accounts to make 6 months.  But if I go straight taxable then I'm like at least 10x that.  But I ain't putting that in my budget (invested aggressively), of course.

      I did however, put a conservative income producing robo-advisor account on budget over the summer, and I like how it's been working.  I only record the dividends and interest it generates, and keep an eye on the value of the account to make sure it doesn't dip below the YNAB balance.  It has actually gained over $1k so all is well.

      And yes, I know AOM means little.  Mine is over 100 now for the first time, but net worth is plummeting as I'm in an unfortunate cash bleeding phase.

      Like
      • jenmas
      • jenmas
      • 11 mths ago
      • 3
      • Reported - view

      Annieland Not necessarily. I don't have those on budget but my AOM is in the 340s. I just save for things and then never get around to buying them. . .

      Like 3
      • Annieland
      • YNABbing every day since 2009!
      • Annieland
      • 11 mths ago
      • Reported - view

      jenmas Dangit.  I gotta try that sometime :).

      Like
      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 11 mths ago
      • Reported - view

      Annieland My 300 that I had was cash only (and CDs and savings bonds), and doesn't include cash in my brokerage account.  My 173 was the same amount of cash after passing through the proceeds from a house sale into a down payment in the next house, and dropped below 150 when I paid the credit card bill for all the new furniture we got. yet at this very moment, my budget has more money in it than it ever has had, although some of that is due to a severance I received when losing my job in mid-October. That's why I don't take it seriously.

      Like
      • Superbone
      • YNAB convert since 2008
      • Superbone
      • 11 mths ago
      • Reported - view

      Annieland First of all, yes, forget about AOM. It is utterly useless once you get to a certain point (maybe always?) What I grew to love about YNAB was the ability to categorize my funds instead of having an account with an amorphous blob of money. So, I did an experiment and added my taxable Vanguard account to my on budget funds. Turns out I love it! Now I know exactly how much I have saved up for my next car, for my yearly IRA, for my music CD project I eventually want to do, and some of my E-Fund that is used to be partially invested. In order to do that, you need to have a large category(s), in my case my Freedom Fund, that can handle large investment risk swings.

      I think I'm one of the only ones that does this. However,  I assure you it isn't so I can have a large AOM!

      Like
      • Annieland
      • YNABbing every day since 2009!
      • Annieland
      • 11 mths ago
      • 1
      • Reported - view

      Superbone That's cool!  I'm sure I do PLENTY of things with my budget no one else does, mostly because I just like to keep it interesting  :).  I was worried putting my taxable robo advisor account on budget, but I just couldn't stand having savings not doing much more than earning interest.  I still get unrealistically nervous assigning the dividends to categories, but I know the money actually exists, even if I hope not to withdraw it for a while. 

      Like 1
      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 11 mths ago
      • 2
      • Reported - view

      Superbone 

      Superbone said:
      First of all, yes, forget about AOM. It is utterly useless once you get to a certain point (maybe always?)

       No maybe about it. It's always utterly useless.

      Like 2
  • If the money for it is already in the budget but in the next month, I'm okay fudging the date.

    On the other hand, if you will need future income to be able to budget for it that would come in after the payment comes out, then you need to move money around in the budget to cover it.

    Like 3
      • HappyDance
      • YNABing consistently since 2014
      • HappyDance
      • 11 mths ago
      • 2
      • Reported - view

      I'm usually in the don't fudge your entry camp, but what   nolesrule says here resonated with me.  I'd probably just leave it as is and move on.

      But my first thought was: what kind of a cockamamie system are you all living with, where your bank pays your bills early because the due date happens to fall on a weekend or holiday.  All of mine come out on the next business day, without penalty.

      Like 2
  • I'm in the just fudge-it camp.  I also don't autoschedule anything except recurring subscriptions/utilities that pretty much don't change.  I know, I know, everyone else does.  I've paid my mortgage manually every month since I first bought a house in 2004.  I've only recently switched to scheduling on due dates instead of paying on the billing/closing dates, but I'm still way too much of a control-freak to not be the one to push the button myself. :)

    Like 1
    • Melissa
    • Routinely questioning every assumption I have about my budget, my spending, and my savings habits.
    • todays_mel
    • 11 mths ago
    • Reported - view

    If you have the payments set up through your bank's bill pay feature, I'd recommend adjusting the issue date a week or so earlier than the due date.  Especially since you've got the funds available and budgeted for those two bills, and have a few weeks to get the change put in place before the end of November.

    I do this with my HOA fees; they're officially due on the 1st of the month, but I have my bill pay set up so that it's automatically issued on the 21st of each month. This gives me around 7-10 days of wiggle room depending on how many days are in the calendar month and if there are any weekends/holidays/non-leap year shenanigans that might delay or alter the time it takes to clear the bank.

    For example, my November fees (due 11/1) was issued on 10/21 and the payment actually cleared my checking account on 10/23.  I use the cleared date as the official "transaction" date, since that is what will be on my bank statement as when the funds were withdrawn.

    This way my payment always hits prior to the due date, but within a single budgeted month so I don't have a weird "double" payment month, like you're running into.  

    Like
      • Melissa
      • Routinely questioning every assumption I have about my budget, my spending, and my savings habits.
      • todays_mel
      • 11 mths ago
      • Reported - view

      Melissa I should note that you'll be stuck with a double-budget month for November because it sounds like your 11/1 bills have already cleared and you December (12/1) bills will likely get paid at the end of November. But going forward, you shouldn't run into that problem again once you give your bill-pay date more padding.

      Like
    • Melissa Yup, you have it exactly right...  I could just set my bill pay to the 3rd as well.  The only 2 bills I have that are "due" on the 1st of the month are mortgage and car payment.. both of which have a 15 day grace period anyway... so they won't be "late" payments if they arrive a few days late.  Might be better than the double payment to get them scheduled to go out a week early... and will keep the payment in the month they are due.

      Like
    • eloquentz
    • Numbers Wizard (Accountant), Acoustic Artist (Musician) and Jill of all Trades (Wife & Mother)
    • eloquentz
    • 11 mths ago
    • Reported - view

    I don't understand why pulling payments early is a thing. Every single one of my pre-auth payments that falls on a holiday or weekend will process the NEXT business day, not before. (Most of my pre-auth payments are every Friday, biweekly Wednesday with only a couple being on "dated" payments as opposed to weekly/biweekly so it doesn't affect me much.)

    Like
    • eloquentz The difference is that I wasn't doing an authorized payment through a billing system.  I'm using my banks "Bill Pay" feature to send a physical check/payment... and I have it on a schedule to make that payment on the 1st of each month.   Today I noticed that my bank had my  December scheduled payment adjusted to cut the check on the 29th of November, because the bill pay date landed on a weekend... so prompted my question.  I can only assume they cut the check earlier rather than later than my scheduled day to avoid any additional delays.. since they mail a physical check instead of electronic payments... my guess anyway.

      Like
      • eloquentz
      • Numbers Wizard (Accountant), Acoustic Artist (Musician) and Jill of all Trades (Wife & Mother)
      • eloquentz
      • 11 mths ago
      • Reported - view

      tonybrown32 Even when I am using a system like that, it NEVER takes the payment early. I would opt out if that was the case.

      Like
      • Momofboysx3
      • I'm going to master budgeting, even if it kills me!
      • Steel_Blue_Mainframe.11
      • 11 mths ago
      • Reported - view

      tonybrown32 Yep, because the bank is responsible for any late fees if it is late. It's usually in the fine print on how they handle it.

      Years ago I had set up my water bill to be delivered a couple of days early because I knew our water company liked to keep the check on the desk a day or two before declaring it delivered. The first month, the payment was late. I called my bank, and they did a three way call with the water company to let them know that I had it set to arrive on this date, could they tell them what the date was on the envelope. Nope. Would they wave the late fees, Nope. The city water hung up, and the bank rep was floored. Said that's the first time they had ever come across that. Could I please set it up to be delivered a week early? I chuckled and said sure! LOL

      Like
      • Superbone
      • YNAB convert since 2008
      • Superbone
      • 11 mths ago
      • Reported - view

      tonybrown32 It's too bad these bill pay systems don't give you the option to push the payment to the next available date for these cases.

      Like
    • Superbone Yeah... I can go in and edit this payment to send it on a different date, but I wish it would give me the option to select "early" or "late" for payments that fall on a weekend/holiday.. so that you could choose which way you want the payment to be adjusted automatically, instead of having to manually adjust it after it's scheduled... but oh well... 

      Like 1
  • Annieland said:
    I still get unrealistically nervous assigning the dividends to categories, but I know the money actually exists, even if I hope not to withdraw it for a while. 

    I think you'll get comfortable with it in time. 🙂 What's really scary is assigning increased/decreased equity values which, as you know, can fluctuate wildly and are not actually realized until you sell them. But like I said, I have one category that can handle the swings.

    Like
Like Follow
  • 11 mths agoLast active
  • 50Replies
  • 436Views
  • 13 Following