Silver Pegasus good point. Knowing I regularly move balance from one category into others indicates that I might need to increase my budget in the target category or reduce the budgets in those other categories. Sure I see this in the month when I make the move, but I don't know if that is a one time mis-budget and I'm rolling with the punches, or if it's a move I end up making nearly every month that indicates the need for a longer term budgeting adjustment.

Scott Comparing the average spent with the budgeted amount gives that information once you have budgeted for a few months. If in the current month, the average spent is higher than what you want to budget, you are likely you will need to move money into that category during the month or a future month. 

I guess one of the major cases when you might not need to move money to the category is if you have consciously decided to curtail your spending in that category

jenmas This is what I do (use the notes).  If I WAM a large amount or if I reallocate to a different goal then I make a note in both categories.  For example, we had money set aside for son's living rent at school for this year. Thanks to COVID he's living here. So we don't need that category funded (now or ever). So I reallocated the amount to my other son's 2nd level tuition. Sort of in the same group for now. I did at one point make notes in the month's notes but they are really hard to get at.  If I move money from the emergency fund to cover something I usually just make a note in the emergency fund category. 

The first shows moving money from one category to another (and then back again).  The second shows emergency fund (sidenote - the July 2019 note is when we got rid of the credit card float and stopped budgeting based on monthly expected income and only on real dollars - ouch).

MXMOM but why does it matter why you took money from the residence category? How does it help you with the rest of your budgeting?

jenmas because it helps explain an apparent “windfall” when looking back or explaining where it went when the money is gone  

Silver Pegasus Lots of people have moved beyond a generic Emergency Fund because it doesn't give insight into how near-simultaneous likely "emergencies" can be tolerated. Not to mention, most "emergencies" for new users are really true expenses. So yes, I can see the parallel to a generic EF, but I'd submit that could be improved with more specificity as well.

You mentioned two things already (home improvements and trips). When questioning whether you can take a trip, you would need to worry about how much you're planning in the back of your mind for home improvements. Or vice versa. Failing to do that risks spending coming up short for whatever you want to do second. Compounded by anything else you "might" want to do with those funds.

Since you're not a new user and you've already seen the benefits of being concrete elsewhere in your budget, I'll leave off with the observation that the generic categories seem "inconsistent" to me, but it's called "personal finance" for a reason. Cheers.

Silver Pegasus 

i’d just add a little bit. Spelling out what the medium term priorities are, and guessing a dollar value not only helps with prioritising. The other thing it does is it rearranges your thinking. So you get to realise that the planned trip and the renovation of the back deck are not equally important, the trip matters more. You also realise that the new Ipad has never got dollars in the last six months, that while you THINK you want it, in fact, in reality, you dont. 
There are so many things we THINK we want or need, and it is so difficult to escape the advertising pressure, the everyone-else-can-afford-it pressure, the what-you-are-supposed-to-do, and know what you REALLY want. This prioritising process of assigning dollars to all the different things calling for our attention and $ rearranges your thinking and exposes your true real fundamental priorities, what really adds value to your life. There are no wrong answers there. This , i think, is the true magic of ynab. (I budget a few dollars to waste in opportunity shops. Its fun. Practically speaking its wasteful. Others might opt for a small house and big travel budget. Or buying art but not eating out. Or eating out but holidaying at home.  Discovering where you get the real (not imagined, not what others think is good) value in your living is priceless. )

Scott seems convoluted. Why not Just have a Flex / Personal Spending category for each of you. Record the spending directly in that category. Any leftovers automatically roll over directly in that category. If you want to move some to a wish farm category, then just do it.

YNAB does not have the capability you seek. You'll either need to change your process (eliminating the need for your request) or find another program better suited to your process.

dakinemaui It isn't bad at all really. I'd rather record the spend in actual categories so I can see how much we're spending where later on. If I just assign it to the flex spending category, figuring out what type of spend it was later on is more challenging.

Scott this is really just WAMing from a "budget wiggle room" category.  

MXMOM In a way you could look at it like that. But as dakinemaui suggested I could just be budgeting these expenses against the flex categories and that would be fine. The extra step I take to allocate spend to more detailed categories gives additional clarity into the irregular discretionary spending we do.

For example, we don't always eat out every month. Most months neither of us buy any clothes, and the amount we spend when we do is highly variable. Once or twice a year I have a large sporting goods purchase (this year it was rain pants, a wool baselayer, crampons, and an ice axe!). These aren't budget categories I can predict, even at the beginning of the month, and I wouldn't want to plan for spending in these categories because it's so erratic and variable.

Further, since both my fiancee and I might buy clothes (but very infrequently), budgeting directly in the clothing category doesn't give any insight into our own personal spending, which is very important to me. Regardless of our incomes, I want to make sure we have equal flex money, and I want to make sure neither of us is outspending the other regularly. We currently still have separate checking accounts which give some insight, but once we get married we'll be merging into one and will lose that tool.

Another way to think of it would be if you could budget dollars to a category group, and then assign them to categories within the group when spending occurs. That's basically what the flex categories do.

MXMOM said:
this is really just WAMing from a "budget wiggle room" category.

I'm a fan of such a category. It's literally the lowest priority in the budget, and therefore the first thing to go when something more important needs funds because I can't guess 100% right all the time.

MXMOM I like this category name. Thanks. It’s better for me than ‘Stuff I forgot to budget for’ as it’s usually because I underestimated a category (as I’m still fine tuning my budget) not that I forgot it. I don’t want to take out of Emergency funds or a budgeted True expense!

Scott I haven't yet made it through all of the comments so I apologize if this has come up already, but I'm wondering why it matters so much to you whether the flex account for each of you was used for video games or clothing or whatever else...

My husband and I, and our 3 teenage kids, each have a Personal Expenses category (with differing budgeted amounts assigned to each, depending on what amount seemed reasonable for them (kids all have the same amount). . If someone chooses to spend all of their money on makeup and clothes (daughter) or tennis shoes and indoor tennis court time (husband) or Lego Creator expert sets (me!) I don't care as long as their monthly allotment doesn't go over their budget. 

Even before kids it was nearly impossible to ensure we had "equal" amounts to spend. I love to read and knit and hubby plays a lot of sports so I'd have categories  for books, hobbies, and sports. But there was really no logic behind that; tracking it didn't provide me with any insight other than reading books is a lot less expensive than playing tennis!

Scott Also, your annual/large sporting goods purchase absolutely - and - should be budgeted for! You may not know when or exactly how much such items will occur but you know they will so you should set aside the funds for these.

Periwinkle Flute 

Periwinkle Flute said:
I love to read and knit and hubby plays a lot of sports so I'd have categories  for books, hobbies, and sports. But there was really no logic behind that; tracking it didn't provide me with any insight other than reading books is a lot less expensive than playing tennis!

 It's a fair point, and I think arguments could be made in both directions. Categories generally matter though, otherwise why budget at all? When budgeted to directly, they help with anticipating where spend will occur, and they do provide insight into spend trends after the fact. Whether that's valuable is up to the budgeter.

For me, I think elsewhere I used a hypothetical example of an alcohol budget. The value of seeing trends in spending isn't about balancing the budget, but about understanding behavior. If I were to spend a large amount on alcohol each month but allocated that spend directly to my flex category, I have no insight into this type of spend. If instead I transfer flex budget to an "alcohol" elective category and record my spend there, I immediately have a metric showing my alcohol consumption over time in the context of my overall budget. This both helps reveal spending trends that might not be as obvious (do I really spend that much on alcohol!?) and can help inform changes in behavior (maybe I should consider other priorities). That's it really. There isn't anything else I'm getting out of it.

(Mainly for Periwinkle Flute 's benefit) Recommended practice is to just budget directly to the alcohol category and record spending there. It's probably worth repeating that Scott has a flex category and then reallocates as he spends to the alcohol category in order to keep his and his partner's discretionary spending separate and equal. That requirement adds a layer of complexity that others may not need.

(I think that's the case, Scott; please correct me if I'm wrong.)

dakinemaui yup that's correct, and I've made my case previously as to why I get value both from a flex category and from allocating that flex category into defined budgets. It does add complexity and may not be for everyone 

MXMOM I'm trying to wean my fiancee out of this mentality. Even though we have a fully funded emergency fund and additional savings beyond that, every moderate unplanned expense is very stressful for her. I'm really hoping YNAB will help with that, since I can show her we have already budgeted for unplanned healthcare expenses, vet bills, or car repairs long before they happen. It's a difficult but rewarding process to transition from money being stressful to seeing money as a tool to facilitate life.

 dakinemaui well said. They are (says newbie user). Slowly I’m putting money aside for next months non-monthly bills and even a few ‘date unspecified’  true expenses. I’ve even subtitled my small emergency fund (unfunded true expenses)! 

Yes I can Brilliant! Love the new category name.

MXMOM What I mean is if I don't have a bucket each month for flex spending but instead budget that bucket out to the various categories it gets used for (clothing, sporting goods, video games, etc), I no longer have a way to easily see how much each of us has used of our flex spending each month.

Alternatively, if I recorded the actual against the flex category, as you say I'd only see the spending as flex spending on reports rather than the more specific category of clothing or sporting goods.

The overall goal is twofold:

1. Track and limit our overall personal monthly flex balances.

2. Track how we spend our money against different kinds of consumption (video games, dining out, etc). This is the normal function YNAB supports.

Scott would you possibly get the same information if you put Clothing, sporting goods, video games in a category group (possibly each of you their own) and budget your flex money there. Of course you wouldn't always guess right, but for clothing you can take from sporting goods etc. And reports would tell you what each of you spent your flex money on over time.

I know you were looking for a different way, but thought this might give you the same, via a different (now possible) route.

Powder Blue Pony Yeah that's an interesting idea. I wouldn't get a single category for household clothing spend, for example, but I could see how each of us spends on clothing differently. If there was a way to tag transactions that would also work: I could tag hers vs mine. Memo line is kind of like this, but it isn't useful for reporting.

Scott could you use the flags as tags like this? You can’t change the names but you can search and report on the different colours eg, blue for you, green for your girlfriend, red combined . There is a recent Hannah video on this. 

Yes I can If you use the Toolkit for YNAB extension for Chrome or Firefox, that lets you give the flags names. They of course are only available on your computer and are browser specific but it's still better than nothing.

Yes I can Scott of course the flags. Why didn’t I think of that. FYI when you export to excel the flags come over as well. 

MXMOM I'll have to look into these. I haven't used this feature at all.

Scott I don’t use the toolkit but I think it allows you to name the flags. 

MXMOM she's much more frugal than I am actually, I think in part because she spends based on how much it stresses her (so she avoids spending) rather than on the money we have available. As a consequence I keep bumping up against the (arbitrary) flex spending amount I have while hers snowballs into wish farm items. 

MXMOM We intend to combine our money and the budget includes all our funds from all cash and savings accounts.

I think what I'm trying to avoid is partly psychological. I make more than she does, and in the past she's felt like that was used by a previous partner as a means of manipulation. By budgeting all of our expected, recurring, or unavoidable expenses from our collective net wealth (things like groceries, rent, insurance, medical, vet, savings for emergencies and house down payment), we split those shared or unavoidable costs of living. Beyond that though, we each have hobbies and interests, and my goal is to make sure we each draw the same amount from our total funds to put towards those personal goals.

By using separate flex categories, I'm basically forcing her to realize an equal amount of personal spending as I am. She can then do what she wants with it or roll it into a bigger item like a new bike (or she can even dedicate it to a shared goal, but that has to be a conscious choice). Without this, I might end up spending proportionate to my income and she to hers, or worse I might spend proportionately more. 

Does this make sense?

Also to helps when I want to buy a big ticket item like a new graphics card that's purely for my entertainment, I can point to our flex spending budgets and wish farm items and say I saved for it, and she likewise saved for and earned her big ticket items. It makes things overall feel more fair I think.

Scott I think it’s great that you have insight into her “issues “. There’s a saying that personal finance is more personal than finance. And you guys are at the beginning of your “partnership” so there are so many years to fine tune the way you handle money. I understand your point and leave it to you guys to figure it out. 

dakinemaui Thank you (and thanks for all your advise and insight).

Yes in most things I prefer equitability, but in this case if one of us has a hobby that costs more, then I'd prefer to increase both of our flex budgets. That way the other person has money they can allocate to whatever their priorities are. Maybe those priorities are shared, like moving the money to the housing down-payment category. That's fine! But moving allowance into a shared category should be intentional rather than a byproduct of one person spending more than the other on hobbies. Otherwise the person with the less expensive hobby will find themselves with more allowance and might realize they can afford a new hobby or improve the quality of the hobby they have. Having the allowance can trigger changes in behavior. Without equality in allowance, I might eat up the majority of our combined flex budget for my hobbies, which, while it may be fine with my partner, has the effect of limiting how much is available for her to spend if she wanted to. If she decided she wanted to spend more at some point, we'd have to hash out how much of my hobby I'd have to cut - an uncomfortable conversation. Giving equal allowance to begin with ensures that never happens. Also this is really a luxury of us finally having our financials in order. It would be much more challenging if the true costs of living were a larger part of our income.

It's hard to find a good analogy, but maybe voting is one. One person might care tremendously about the outcome of an election and have a big stake in it, while another doesn't really care all that much. You don't give the person who cares more voting power than the person who doesn't. Both people can choose to vote or not, and who to vote for, but the total influence they can have in the voting process is equal.

Scott this is what I say about matching amounts spent on kids (I know different than marriage but I think it’s applicable). 
Fair doesn’t mean equal. So if I spend $2000 on goalie equipment for son 1 (take that as a hint to never let your kids be a goalie) that doesn’t mean I have to set aside $2000 for son 2. Son 2 went to Germany (twice) which may have cost more or less than $2k. Different people, different goals. 

I will plant one thing in your mind for future consideration. When/if you have kids and one person stays home and makes no income there can be a danger to this idea of balancing money.  If there is one bucket, then the concept of your contributions vs my contributions become irrelevant. 

glynab I agree that it would be frustrating to find the categories different. In our household, I am the “administrator “ so I do the budget allocations before the budget meeting, I move (WAM) money to cover overspending (but tell my spouse). For large movements which are a clear change in plans, after we discuss, I move the money and make notes in the category. 
hubby records his transactions himself (Usually with funny comments) and checks the available funds. 
WAMing within a category group is not a big deal here (eg food category includes groceries, restaurants, coffee truck and Starbucks) so if restaurant goes over but there is still money in groceries, that is a no discussion required WAM. 
I recommend that this model be used (with one administrator). Also funds shouldn’t be moved (regardless of who moves them) without discussing first. 

MXMOM That's a good strategy I think. I do like the accountability angle of tracking budget adjustments.

Slate Gray Sander Where it came in the past from simply doesn't matter. As you look at things NOW, what is most important to fund before more money arrives? Repeat with the 2nd most important. When you're out of "new" money in TBB, you have to consider reallocation. Starting from whatever next-most important category didn't get funded, is that higher than the lowest priority category with funds? If so, then reallocate. If not, then that unfunded category is obviously the lowest priority but you're out of funds, so you're done for now.

dakinemaui Anchoring bias. It causes you to be unduly influenced by the original number, even after you've made the change.