Budgeting for future months

My husband and I were wondering how many months can you budget in the future? So if we have all of April budgeted for, we would go onto May. If May is all set in mid April, do we get June? Or is it just the current month and the next month? 

Thank you!

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  • I don't find it useful to budget more than one month in the future. It's little things like the taxes on my cell phone bill vary by pennies from month to month. Or Netflix is increasing their price in the next billing cycle. I only want to have to change this in one place rather than go from month to month changing something by $0.03.

    Reply Like 6
  • The program will let you budget in May if you have budgeted something in April.  It will let you budget in June if you have budgeted something in May, etc.  It is now April.  You cannot budget anything in December before budgeting something (even just a penny) in each of the months from April through November.

    Whether budgeting multiple months ahead is a good idea is a different discussion.  I am in the camp that believes budgeting more than one month into the future is busywork, and if you have May totally budgeted before the end of April you should consider longer term needs for any excess money.  Maybe an Income Replacement category, for the event of job loss.  Maybe throw some money at discretionary categories.  If you have debt, maybe throw more at that.  If everything looks fully funded or on track to be fully funded when you need it, think about an Investing category, then spend the money by throwing it out of the budget at some form of off-budget investment account.

    If you budget infinitely into the future, you will never get to the point of investing.  There will always be another month that needs money for groceries and utilities.

    Reply Like 9
  • What they said.

    Just build up an Income Replacement fund until it has enough in it to fund the number of months you feel you'd need to fund in case of income loss. It does the same thing but without all the need for ongoing category micromanagement across multiple months, because March income funds April, April income funds May, May income funds June, etc., and all the while you still have the money in the Income Replacement category that could fund future months if your income were to be interrupted.
     

    Reply Like 5
  • This isn't just a philosophical reason. I budgeted out years into the future when I started (and before I learned to let go of forecasting) and ended up in a situation where when YNAB loaded I would instantly get the "something to do with internets and tubes" error over and over and over. I ended up not having a usable budget until I backed out all the future budgeted months.

    If you refuse to use a holding category, then at least don't budget further than one month in the future to avoid this issue.

    Reply Like 3
  • One of the great things about YNAB is that you need to think about your priorities when budgeting. I don't know about you but my priorities change more often that I'd like to admit, so I would probably be pretty unhappy budgeting many months into the future. One or two, OK, but by then I've already decided I might shift my priorities from a future iPhone to something else entirely that now seems like the more sensible goal. Rinse and repeat

    Reply Like 1
  • Thank you all! All I wondered was if we could continue to budget out. It’s really up to us if we go further out but I wasn’t sure if we in fact could. We have our budget pretty set and know what we want to do just wasn’t sure how many months you got at a time. 😊 Thanks for all of the opinions. 

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  • Gray Falcon said:
    We have our budget pretty set and know what we want to do

     Until it changes. And it will. More often than you think.

    Reply Like 2
  • I've been using YNAB for almost 10 years. Most of the people who just told you it's not a great idea to budget far into the future have been successfully using YNAB for 5 years. They have volunteered countless hours answering questions on this forum. They know what they're talking about. Yes. You can budget as many months into the future as you want to. It is a very bad idea. We have used the software, answered numerous questions, and helped people unwind all sorts of mistakes and unintended consequences.  Don't get ahead of yourself.  Budget for May if you have the funds available. Put extra money in a holding category. 

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  • My thing is, is that I only asked if it was possible- not if it was good or bad idea. So to me it’s not a needed opinion. So my husband and I will do as we please with it. If that’s budgeting for July in April then so be it. We all learn from our own mistakes. Each and everyone’s budgets are different and that’s the great thing about them. So just because we can doesn’t mean we necessarily will. I just wasn’t sure how it worked. 

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  • Gray Falcon Just know that if you've budgeted out more than one month that any changes to the budget without WAM and moving money from category to category can pull from later months (stealing from the future).  I think the toolkit makes the Budgeted in Future red so it's at least more easily visible.  So for example in March I had to increase the budget for one category and then had to adjust things twice, once to take care of money taken from April and again for money taken from May.

    Whether or not you want to do that is up to you.  I personally don't have an opinion about how you choose to use the budgeting software.  But this one issue seems to be kind of a hot button topic, and not because of anything you've done or said, so there are strong feelings about it.  As I understand it, the current software allows the 'stealing from the future' when previous versions of YNAB wouldn't and that change angered/irritated some long-term users.  As I understand it, old YNAB allowed you to allot money to more than one future month, those pools of money were independent from one another and increasing the spending or budgeting in this month would not automatically affect later months' budgets.  If you couldn't WAM money to fix the red in this month, you would have to go into later months and free up money there if you didn't want the red to carry over from this month to the next.  New YNAB does not allow red in a category from cash overspending to carry over (whereas if you charged on credit more than was budgeted in a category, that would turn into credit card debt next month).  I think.  The different versions of YNAB's ways of dealing with categories in the red are fundamentally different, there are people who are firmly in one category or the other and never the twain shall meet.

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      • adriana01
      • adriana01
      • 7 mths ago
      • Reported - view

      Technicolor Cheetah the issue is always Stealing From the Future. Even with the Toolkit it's not obvious what happened or how to fix it. If YNAB would just fix it so it couldn't happen (which could be done) or really obvious when it does (a more likely solution) it would just be a personal workflow preference.

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      • Technicolor Cheetah
      • Not sure when I became a cheetah...but I'll run with it
      • technicolor_cheetah
      • 7 mths ago
      • Reported - view

      adriana01 

      Like I said, never the twain shall meet.

      I'm not buffered yet so the current version works fine for me.  However, I think YNAB would be better if you could choose to 'lock' months as that ability would be ideal for, say, variable income people.  So if upon set up or when someone changes to a variable income job, they could enable the Locked Future Months function.  Then a teacher who only gets paid 10 months a year could, in every month they're paid, put 10% of his or her income in both of the unpaid months.  Or if you're a contractor or on commission and you know that you need $5000 to meet basic expenses, in months where you make more, you can lock the money in future months.  The current system not suited and is in fact can be somewhat dangerous for variable income people.  It would be better there was a choice or if, upon starting a trial, people were asked if they have variable income or are living off of money earned in months past so they could be instructed on how to make buffer categories for future months work.  

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    • Technicolor Cheetah thank you! That’s really all i was looking for was if you could. Not if it was a good or bad decision. I appreciate the help! 😊

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      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 7 mths ago
      • 2
      • Reported - view

      Gray Falcon Sometimes, the question being asked isn't the question that needs to be answered.

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      • Technicolor Cheetah
      • Not sure when I became a cheetah...but I'll run with it
      • technicolor_cheetah
      • 7 mths ago
      • 3
      • Reported - view

      Gray Falcon 

      I can see the benefits of both ways and I could make either way work.  But it's more work with nYNAB (the current web version) to budget too far ahead of the current budget if you have highly variable monthly expenses or on the occasions when you need to cover overspending.  So some people advocate to try to replicate the locked pools of money for each month in the old YNAB with buffer categories in your new YNAB budget, one for each month you want to fully budget ahead.  If you have these buffer categories, at the end of the month or first thing at the beginning of the month, you will need to 'free' one category of those dollars or pesos or denari and budget them.  For example, you have two months past April.  Buffer #1 and #2 have a month's worth of money in, buffer #3 is empty.  You would send all of your April income to Buffer#3, then at the end of April/beginning of May you'd transfer the contents of Buffer #1 to TBB, and budget May.  In May moolah earned would go to Buffer#1, then at the end of May/beginning of June, you'd transfer Buffer #2 to TBB and budget June.  Rinse and repeat.  

      I think the idea of nYNAB is to keep the budget current in your mind and responsive to changes in your realtime life.  With this YNAB you cannot 'set it and forget it'.  It requires at least weekly or monthly interactions.  The way it works now, you don't want to find out three months after Burning Man is over that your future budgeting now is screwed because you only funded half of your expenses from Burning Man (beer goggles, oh the 'beer' goggles).  You'd end up with red categories in your last budgeted month or credit card debt.  Neither of which is ideal.   The idea is that it's better to deal with the overspending immediately after you've dealt with the Burning Man hangover in the current month's budget instead of having to make multiple budgets' worth of corrections after the fact.  With buffer categories for future months, you will know as soon as the transactions are uploaded or manually input that you've overspent and need to reallocate your funds to cover the overspending.  

      Obviously you're going to do what works best for you, ignoring any naysayers.  Forewarned is forearmed, however, and you're now more aware of the advantages and limitations of each possible method. 

      Reply Like 3
  • I wanted to say thank you to everyone in this thread. I searched yesterday (about 3 hours) for a "how to" regarding future months and how people handled their income when they were able to fund more than one month. I had previously been given the idea for the category "income for future months" and have implemented it, but I was not really sure how to deal with more than one month or mid and longer range holdings in YNAB. I most certainly want to stay away from SFTF and the inconvenience of making tedious adjustments as things do seem to change more rapidly than I had ever imagined. Even though the OP wasn't really asking those questions you all answered them beautifully. Thanks!

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