Transfer money from Savings to an Investment Account

In YNAB, I have a savings account under Budget. I also have an investment account under Tracking. The latter is what YNAB seemed to force upon me when I created the account. 

I want to transfer $X dollars from the savings to the investment account, but the app wants me to categorize the expenditure as if it's an actual expense.  Do I just disregard YNAB's suggestion when I create the investment account and consider it an income source (like cash or savings) or is there another way to do this? I just don't know why I'd need to treat such a transfer as an expense.

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  • Tracking accounts are not part of your budget and any money that leaves your budget is an expense. I transfer $X to my investment account on the 30th of every month. I have a category called Investments. I budget $X to it every month. When the transfer happens, it is categorized to Investments.

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  • The vast majority will not make an investment account a part of a zero-based budget because the balance changes behind your back. The recommended practice is to not assume that all the money in the Christmas category will make it back after a trip to the brokerage and that you should call a spade a spade: that money no longer has the job of funding Christmas; it's job is to make money.

    OTOH, if you're OK with negative market movements resulting in effective "spending" -- and are willing to devote funds to cover such spending -- feel free to bring that account on-budget (i.e., as a checking account type). Reconcile/Update the account balance often enough that the difference between the YNAB and ever-changing real-world balances is negligible.

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  • Yes, I have the same Issue. In my opinion, the money in the savings needs to be considered as investment. Where as currently, even the saving money is be considered for budgeting. Causing the money in the savings to be considered for budgeting, which is not right. The solution I use is starting a category named Ïnvestment.

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      • Superbone
      • YNAB convert since 2008
      • Superbone
      • yesterday
      • 2
      • Reported - view

      Slate Gray Python That is not the YNAB way. It’s not an “issue”. Categorize your savings and be done with it. You only have to do it once.

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    • Hi Slate Gray Python !

      We do recommend budgeting for any investments you plan to make. Since you created that Investment category, you can budget your savings towards that category and then "spend" that money on investments (such as transferring to your investment account).

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    • Faness that sounds  good
      Savings(category) —-> investment(account)

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    • Slate Gray Python I'm not sure what that first sentence was saying. When you add your savings, you'll want to budget for everything you want that money to do - Vacations, Emergency Fund, Investments, etc. If you have $500 in Savings and plan to invest $100 of it, you'd budget $100 towards the Investment category and the remaining $400 towards your other savings categories. An investment account should be a Tracking account (if included in your budget at all), so transferring funds to that account would show as spending and that $100 would be "spent".

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      • Habanero Salsa
      • Second generation user
      • Aquamarine_Pony.8
      • yesterday
      • Reported - view

      Slate Gray Python If you don’t want to use “savings money” for budgeting, don’t make it a budget account. “Problem” solved. 

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    • Faness yes, the first sentence said, your suggestion is very good. 
      Through, Savings(category) I can budget my salary to Savings. Then I can transfer it to investment account. The beauty of it is that I can see whether I’m in positive cashflow or in negative cashflow. 
      Also, I like the budget  suggestion option. I was an androidmoney user, now a YNAB believer. Thanks for your efforts.

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