Budget Using Only One Month's Income
Having used YNAB 4's "Income for this month" and "Income for next month", I feel like I'm at a loss since moving to nYNAB.
I get paid on the 15th and 30th so in YNAB 4, I would put both of those paychecks in "Income for next month" then on the 1st, I can use that money to budget everything. Then during the month, if I'm moving money between categories, it was really easy to make sure I'm only spending last month's income by making sure "To Be Budgeted" is zero. If I'm under budget, it'll be positive and if I'm over budget, it'll be negative, all without affecting spending or categories for any other month.
With nYNAB, I find this workflow no longer works. I understand that it's trying to make your money more fluid by removing the monthly walls but I feel like I'm in less control than before.
For example, if I'm budgeting after my mid-month paycheck, "To Be Budgeted" now contains both last month's incoming as well as income which is slated for next month. This means I can't use it as an indicator of whether I'm over or under budget and makes it really easy to use money that's suppose to be for next month.
In another words, I think of income as buckets. In YNAB 4, each month had its own bucket and that helps your control spending because the software makes it easy to only use a single bucket per month to fill your envelopes.
In nYNAB, all of the income goes into a single bucket and with that, it makes it hard to only use one month's worth since there's no way to divide it up.
I understand that some people create their own "buffer" category where income goes but I feel like this just adds extra friction and a risk for errors.
I’m new to YNAB and I’m really trying to follow the philosophy. It already is a great help. I rarely subscribe to anything, but I think I will in this case.
Bit it I came across this problem of budgeting for next month and found this discussion. It’s great to see so many experi need and new people are aware of it. I will be using the work around mentioned for now because I really want to make it work. But please, another vote for some ability to assign a paycheck to future months. Such a simple option. You could even make it a hidden “advanced” option if you don’t want to confuse users.Reply
This is my first time visiting the forums because I've gotten fed up with the way the income system works in YNAB.
I am a relatively new YNAB user (August 2017), but I've been very diligent with using it and I'm already over 2 months ahead on my "Age of Money". Before I started YNAB in August 2017, I listened to every single one of the podcasts that had been released up to that point (I had a 1.5hr commute). The one huge piece that I learned from these podcasts is to only spend this month what you earned last month, that way you are not living paycheck to paycheck. However, the current way that income is sent to TBB and is not allowed to be set aside for next month automatically contradicts what all of these podcasts have said and actually doing what Jesse advised is more difficult than it should be. YNAB should make it easier to set aside money for next month whenever I receive income this month.
First of all, none of my accounts are linked to YNAB. I like to keep things manual because I find that it gives me more control. I hate budgeting an income of $0.08 for monthly interest so I just roll it into my income.
My current "workaround" for budgeting my income is to not budget it at all. Literally. I don't budget my income that comes in at least twice a month until the very last day of the month. The result is that my account never reflects the amount seen in YNAB so I have to constantly double check that the difference is what my income is. This is extremely frustrating.
I know that it has been suggested to use a different workaround by using a buffer budget category to hold my current month's income until next month. I am going to try to use that this month, but this just seems ridiculous.
Faness please do not tell me to budget for next month every time I get new income. This might be how you like to do it, but this is not what Jesse advised in his podcasts and I find it degrading the way you've purported this method as the way that YNAB is supposed to work. He talked many times about having your "budgeting date" with your significant other at the beginning of the month and being able to "set aside" the income this month until next month. So now I am supposed to do this 4+ times a month every time we receive income? That makes no sense. As somebody else already said... my income's job this month is to not get spent.
It's been two months since this was posted and I'm sure there are posts dating much further back. It is time to implement this simple change and give the necessary flexibility back to the users. You can still go on budgeting how you are, but it is not fair that the people who budget differently are having to trick the system to make YNAB work. I have many friends and family members that I want to suggest YNAB to, but I simply cannot do so until the software follows the logical flow that it was founded upon. Otherwise this "simple budgeting tool" is nothing more than a glorified Excel spreadsheet.Reply
YNAB implemented a new feature request form that is supposed to go directly to the programming/decision making team. I'd suggest each of you that is frustrated with this and does not feel it is being considered to send in a feature request. I would hope that the more they receive the higher a priority it will get.Reply
Just adding my voice to the chorus of folks who want "Income for next month". Been using YNAB4 for years, and I'm on day three of nYNAB. For me (and many of us), living on the prior month's income was the key insight / feature of YNAB. I can't believe that it is gone.
Ironically, when nYNAB was announced I put off trying it because I didn't like the change in how credit card charges are handled. It's only taken me a few hours to figure it out, and I think I like it now. But I never would have imagined that YNAB would take away the "income for next month" feature. It was always the heart of YNAB.
After reading the forums, seems the best I can do in nYNAB is create my own work-around "Income for Next Month" category. Ugh.
And I don't buy the argument that it's a great thing that nYNAB allows you to budget countless months into the future. I liked the YNAB4 guidelines that you shouldn't bother trying to budget future months, cuz the future is too unpredictable. That's forecasting, not budgeting.Reply
Well, since this thread is still going I'm going to go ahead and put in yet another vote to reinstate the Income for Next Month feature. It's so frustrating that it is not there as an option. I use the workaround, but creating a Deferred Income category is an expense category, is it not? I can't see how to make a Deferred Income category that is in the "Income" section, so everything of mine essentially shows an expense. I tried to tweak it today to go right to that new category instead of TBB first and then move into that category, and now I've got everything messed up. I, too, looked at the Every Dollar option today as another poster mentioned to see if they are set up to easily let people get a month ahead. I will send in a feature request, but I'm not trying to request something new - just reinstate what we had, that was the best part about YNAB.Reply
Long time YNAB4 user also and decided to try the new YNAB again a couple days ago. I'm missing the Income for Next Month feature. It was part of the routine and I'm trying to think of a way to work around it, but it just made so much sense that I'm not sure it's worth it. Looks like I'll most likely be going back to YNAB4 which is a shame, there are definitely some parts of the new YNAB which are awesome, but missing this foundational component may cancel out those features. Maybe next time...Reply
However, generally the people who do this will reassign the category to TBB once all their income has come in and they are ready to budget the next month.
This is what I do, but it's far from ideal. I daren't change my income transactions to "TBB" and start budgeting the new month with that money until I'm absolutely certain all my expenses from the previous month have posted, otherwise I'm susceptible to stealing-from-the-future. 😩
My workaround is to make a negative budget entry in the new month against my "Income for Next Month" category and use that money to draft my new budget (avoids SFTF risk.) Once the previous month is finalized -- which probably won't be until September 5th or 6th because of the weekend and Labor Day -- I undo that budget entry and reassign the income to TBB to make the income/expense reports correct.
Ugh. Workarounds upon workarounds.Reply
My workaround is to make a negative budget entry in the new month against my "Income for Next Month" category and use that money to draft my new budget
This is exactly what I do, in conjunction with the method outlined by nolesrule .
Right now it is the end of August, and I am getting ready to budget next month. August TBB is zero and Budgeted in Future is zero. I do have a September budget already set up in YNAB with my normal budget amounts (i.e. my base budget, or template). I have a negative number budgeted in September's "Income for Next Month" category, such that September TBB is zero. The negative number is equal to minimum expected income.
In my August budget, I am waiting for the last income event of the month. When it is received, I will do a few operations:
--Go to October (2 months ahead) and quick-budget based on September's numbers (using the "Budgeted last month" quick-budget option). I do this first, prior to customizing September, so that my October budget contains my base budget figures and I won't lose them. This preserves my budget template.
--Go to September and delete the negative number from Income for Next Month, causing TBB to temporarily go red. Then go to All Accounts, search for Category:Income for Next Month, and recategorize all of my August "Income for Next Month" transactions to TBB. That will cause all of the earned income from August to flow forward into September's budget.
--In September, budget to zero and make any modifications that are unique to September (remember I already copied my template forward to October, so I can manipulate September without destroying my base budget). All done!
--As income arrives in September, I'll categorize it directly to Income for Next Month. At the end of September I'll repeat the steps above.
I started using YNAB in January of this year (well, technically mid-December of last year) and have been using this method because it is the only one that makes sense to me. I was not having a very good time with YNAB until I learned this method from advanced users in the old forum who were kind enough to coach me and answer my questions.
This workaround sounds kind of clunky, but I've gotten used to it. However, I dream of the day when YNAB will make it easier for me to live on last month's income and budget a whole month at a time. It is more efficient, allows me to see the big picture better, allows me to make better choices, and facilitates more productive budget meetings with my spouse.Reply
Great news! I just got an emailing saying YNAB is working on changes to TBB to prevent confusion with stealing from the future and it's about to go into beta testing. I'm unsure how the changes will work, but the fact that they have acknowledged there's some confusion is great! Here's to hoping things change in a positive way. 🍻Reply
Wow, I didn't expect such a wide audience from this thread!
I also received an email about testing a beta fix for Stealing from the Future.
I want to thank Faness and the whole YNAB team for listening to our feedback and actually doing something about it! It's impossible to always satisfy every user and every use case but it's actions like this which proves that YNAB still cares about their customers and makes me happy to pay for a subscription.
Keep up the great work!!!! 💙Reply
I get paid on the 1st and 15th. Every once in a while I get paid on the 28th-31st depending on days of the month and whether the 1st falls on a week end day or not. When this happens that income gets put into the prior month. Having been a YNAB 4 user, this is 1 of 2 frustrations that make this new YNAB a deal breaker for me.Reply
I used to be a YNAB 4 user and now I'm liking the new system a lot.
In fact, when I have a paycheck I just use it for the next month budget. If I'm paid the 1th, 15th or anytime, I budget the money for the next month. And even that, if for the month M+1 I think I'm done, I go on with month M+2...Reply
Before nYNAB came on the scene and folks on the other forum would talk about being able to budget beyond next month, I imagined a functional requirement: "The user shall be able to select the month in which to apply inflow type transactions." The design element I imagined was a drop down where the user could select "Income for November; Income for December; Income for January, etc.) with maybe up to six months as an option. There were need to be additional requirements and design about how to manage the funds and keep them walled off but I never saw a fluid amoeba of funds.
I'm a HUGE vote for Income for Next Month and for a way to allow a configuration option to do a "red arrow" type of function.Reply
Here's a crazy idea... have an option a user can toggle on to provide a mechanism to push income forward to be budgeted next month. I much preferred budgeting once for the whole month than each time I get a paycheck.
Though really im not even sure a toggle is necessary, I don't understand the objections to this because if you really want to budget your money right away you could select income for this month.
As-is im seriously questioning if I'm going to buy the new YNAB at the end of my trial... and leaning towards NOT!Reply
Wow. I'm super disappointed to find this design flaw after finally making the jump from YNAB4 and having been an enthusiast and promoter of YNAB for all these years.
I've spent HOURS importing and re-categorizing all my imported transactions, cleaning up my budget, and then I discover that I can't allocate THIS month's income to NEXT month without a work around?!?!?!
I've read all the comments and nothing changes the fact that this could be a simple "enable Month ahead mode" so that we can continue to see our planning in action rather than seeing ~2x the amount of money in TBB!
The two reasons that I am moving is that YNAB4 has just gotten so slow (probably due to the size of my data being 8 years worth) and auto-import transactions.
I will still be an evangelist for YNAB, but can we at least get a head of Product Management to let us know if this enhancement is on the whiteboard for a future sprint? Especially if it is a an optional feature that each user can opt in to?
(I give credit to YNAB for my net worth growth - the discipline of only spending what I made last month is a creed I live by - see screenshot of my net worth chart below)Reply
Ha! You expect them to actually listen to their loyal paying customers? Never! They know best and are free to change their whole budgeting philosophy and keep you from doing the exact thing they used to espouse as one of the 4 rules. On the other hand they will go ahead and not fix real bugs because there are some people that are budgeting with money they don't have yet (breaking every rule of budgeting) and the "fix" may be a "big" change for those people.
Check out this post/thread on the old forums for context: https://forum.youneedabudget.com/discussion/comment/830667#Comment_830667Reply
nolesrule and WordTenor curious if you then use nYANB or YANB4 today? Meaning is it worth switching back to the prior version to solve these issues? I've only ever known the current version and luckily am only paid once a month, so it does not seem awful. I do agree stealing from the future is a defect.Reply
Having just returned to nYNAB after its initial introduction some years back, I just encountered this issue as well. I can't imagine keeping an extra $12,000 in my checking account for a buffer. I only like to keep $1,000 to $2,000 extra in a non-interest bearing account. Reading through just a few a these threads reminded me how much I hate spending time "budgeting". It should be automatic, simple so that you can get back to the business of enjoying life and working hard. I had YNAB4 and that was sooo time consuming that I abandoned it altogether after 3 years of use. Now, my mother has cancer and my father is fixing on retiring, both are in their 70s and my time is even more at a premium.
I'm sure the rest on here also have family, kids, businesses, work, and pursuits as well...so we've got to be able to walk away from a system that isn't working for us. My general impression is that nYNAB can work for me, but I went to budget for next month, which is NEXT WEEK and I have a number of bills due on the first and can't unless I transfer quite a bit of money right now. I do bookkeeping on Fridays so this is going to be a problem.
I get paid in large windfalls so YNAB may really work for me, but my dad receives 5 pension, retirement and paychecks per month and it's going to be tedious to keep his accounts. I just need ONE MORE MONTH without a work around.Reply
I can't imagine keeping an extra $12,000 in my checking account for a buffer. I only like to keep $1,000 to $2,000 extra in a non-interest bearing account.
Hi. I've been budgeting in YNAB for 10 years just for reference. You don't have to put any extra funds in your non-interest bearing payment account to use a buffer and be a month ahead. I don't. There's a simple work around to being a month ahead.
- Make a category called something like Next Month (I just call mine Buffer).
- Set up your income events as Recurring Transactions that are categorized to Next Month.
- After all income has been received for this month, release it from your Next Month category.
- Budget next month.
For your non-interest bearing payment account, all you need to do is make sure you have enough funds in there to pay your bills. I average between 1 and 2 paychecks worth of funds in my checking account at all times. I rarely have to transfer in. Mostly out when I have more funds than necessary in there. Like you, I want to be earning the most interest possible on the majority of my funds.
Good luck and let us know if you have any issues. It is not easy when you have to start managing somebody else's budget as well.Reply
I'll jump on the bandwagon here as another YNAB 4 user who came back to new YNAB and is still struggling to get used to the new flow...
My income is very irregular. Much of it comes from bonuses, equity, etc. Much of that is paid on a quarterly basis. Perhaps 50-60% comes from base salary. My monthly spend is around 70% of my total income. The other 30% I use for savings, financial goals, etc. What that means is that part of the "bonus" money I receive in one month may be required in the following two months to cover the difference between by base pay and my monthly expenses. On top of all that, my paychecks come every two weeks, not every month. So some months I get paid earlier in the month, sometimes later. Usually twice a month, sometimes three times a month.
YNAB has no income forecasting; that seems antithetical to its philosophy. But I also can't easily reserve money I've earned for a future month to differentiate it from extra income that is available to be assigned to goals or savings. Worse yet, if I "overspend" this month, it doesn't just mean that my money won't always be 30 days old and I may need some of next month's income to cover next month's expenses, it means I may not have enough money to cover my normal spending next month or the following because I'm living on just base pay. Or I may have to go pull money out of savings or money out of earmarked categories. Which means I either limit my standard of living to 50-60% of my real income, or I'm constantly in the boom-and-bust 3-month spending cycle, or I have to do all sorts of special gymnastics to try to reserve income I've received for a future month. The result is that it is difficult to budget extra money I make since I can't always tell how much extra money I really have. Managing all this in YNAB is basically chaos. Even if there is money in a category, I don't feel comfortable spending it unless I also have 2-3 months of liquid buffer. Or I can try to budget my money 2-3 months ahead in YNAB so my "To Be Budgeted" number is 0, but then I have to make changes in multiple places if I want to change categories and there's lots of mental effort required to make sure I keep everything in sync.
I'm actually considering setting up a separate bank account and receiving all my income there and then setting up a monthly transfer to pay myself a consistent income just to make YNAB easier to use. YNAB would only know about my spending account, and wouldn't try to manage the buffer I use to even out my income. Or more realistically, I'll switch to another budgeting system. If YNAB can't offer a better for solution for irregular income that doesn't fit monthly cycles, I won't be able to continue to use it.Reply
Great suggestions. That is essentially what I am doing, but it is frustrating and creates a bit of uncertainty at month end... "Is this income for next month or this month?" "do I already move money over from my emergency fund?"
All of these are complex workarounds for something that technology should be able to solve.
I envision a toggle in settings: "Budget income one month ahead" On/Off.
Or, to your point: "Roll over excess income to future months at $x"Reply