Funding True Expenses - focus or even distribution?

I do not have enough income to fund all of my true expenses to the extent that they probably need funding each month. What is the best distribution of the funds I do have available to fund true expenses?

1) Pick a True Expense and focus on funding that one item, then when that's on track/fully funded, move on to the next one


2) Take the funds available and divide evenly among my True Expenses, so that they each have some funding but none of them are close to on track?

Or some other option I haven't thought of.

I know we have conversations like these on the forums, but I couldn't find ones that I found helpful recently, and am hoping people don't mind having the conversation again. Thanks!

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  • I use a combination. I start out with method 2, and then if I am getting very close to funding one of my true expenses, I will complete it with one of my paychecks just to give myself a small “win”.

    From personal experience, if I try to fund them all slowly and equally, I often end up stealing from them. But I never steal money from a completely funded true expense.

    • The Artist Formerly Known As And I'm backwards on this. Once I got everything to a point that I could WAM among those long-term categories if something came up (obviously not worst-case scenario), I focused on saving in a snowball-like fashion.

      I guessed at what might hit first/highest priority, then saved to its goal (or a step of it), then moved onto the next.  If it turned out my guess was wrong, I didn't mind pulling money to cover a similar category. However, if I was only contributing small amounts to each category, the progress was hard to see and harder to protect.

      However, in a tighter situation, I might prefer eke-ing (I'm sure that's spelled wrong, sorry)  out a tiny bit for each category each month and then being happily surprised two years down the line (assuming I didn't need to use it or use more than I'd saved). That's what I'm hoping, anyways. 

    • nolesrule
    • Stealing From the Future fix is an improvement but is incomplete....
    • nolesrule
    • 1 mth ago
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    • Reported - view

    So this depends on if you cannot fund them all because of a shortened timeline to when they are due because you just started YNAB (e.g. an annual expense is due in 3 months so you have to fund it 1/3 per month instead of 1/12 per month) or if everything funded at the regular monthly rate is too much.

    If it's the former you will need to focus temporarily and then when you have some breathing room you can establish the regular cadence.

    If the issue is the latter, then your plan is not feasible at current income levels and you need more income or you need to cut expenses.

    Like 2
    • nolesrule It's a small bit of column A, a large bit of column B.

      Regarding the feasibility... I plan to dip into off-budget savings as needed.  I get that it's not sustainable long term, but things being where they are in my life, the unsustainable plan is the priority for the next couple-few years. If it magically looks like things will need to extend beyond that long, then I need a new plan, but since incurable cancer is still incurable, I don't expect I'll need to change the current plan.

      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 1 mth ago
      • Reported - view

      Fuzzball Meows 

       I'm sorry to hear that. It's obviously a situation outside the "regular" scope of these sorts of conversations and certainly requires a different perspective on priorities. 


      And if it has been mentioned here before I must have missed it

    • nolesrule I've not made a secret of it, but I'm also not putting "My husband is expected to die of cancer in the next two years" into every conversation. For one thing, it makes me sad, and for another, it's not relevant to the conversation, in most cases. I'm lucky enough to have a nest egg to see us through this period and be able to prioritize his comfort over living within our means, but it does mean that I made sure our income covers monthly expenses but not necessarily fully funding true expenses/savings.

      My biggest issue right now is that one of my True Expenses was more than I'd saved up for (see: new to YNAB), so ate into many other categories, which now need to also be filled back up. I was more or less managing fully funding the True Expenses (or at least my expectations for fully funding) with our income up until that one hit.

  • The YNAB book emphasizes having priorities, and I think it really just depends on you the budgeter. 

    Is having money for car maintenance more important TO YOU than funding other categories? 

    If you do not have a buffer, I would recommend you try that method.

    Like 1
    • Slate Blue Pilot (2903ac015cdb) It depends how you define having a buffer, I suppose? And/or how you define being a month ahead, if that's part of the definition of the buffer.

      I don't use this month's paychecks to pay for this month's expenses, and despite the temptation, I've not used them to re-fill depleted funds this month either.  That would be how I know I can't stay on track in terms of funding my True Expenses with the income I have now.

      Granted, I also fill next month as the paychecks come in, but am careful to cover overspending by shifting current month dollars around (instead of having an income for next month category, as is often recommended). 

      The issue I'm asking here is: My car maintenance and money for taxes and money to replace my phone when it dies are essentially all of equal importance to me. I know that I can't fully fund my goals in those categories with my income. Do I take the money I have available (prioritized for) those categories and divide it by three, or do I pick one and focus on building that one up, and let the others languish?   

      • Gnarwhal
      • gnarwhal
      • 1 mth ago
      • 3
      • Reported - view

      Fuzzball Meows 

      I had this issue when I got started in YNAB, too. My first tactic was to split my leftover funds equally between my true expense categories. But the slow progress was disheartening. And, as I thought about it, I knew that if some big car repair became necessary, my other true expense categories would be where I'd pull from to cover it. So I determined it made more sense to me to fund one at a time with a larger chunk of money. Doing that helped me see progress, which made it more fun. As much as saving for car repairs can be fun, I guess.

      As far as prioritizing goes, I started with the one I knew I needed first. I knew we needed to do some work in our bathroom, so I sped up saving for home repairs. After that, I just went with the category with the smallest goal so I could see progress quickly — like the debt snowball.

      Some of the true expenses I was saving for were really open-ended because I don't yet know how much we typically spend in a year on, say, out-of-pocket medical expenses. So I set incremental goals for those. Once I gave myself some breathing room in one, I'd move onto another. That helped mitigate the feeling that I was letting the others languish, to use your words. 

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