Newbie question - trying to get started on the right foot!
Hi there, excited to learn this new system. I'm the process of adding my budget and have come across a question. My credit card is due on the May 11th, and today is April 17th. Is it better to budget to money to pay the card during the month of April, or budget it for May since that is when the money will actually come out?
Along the same lines, what should I do with all the items in my budget that already came out of my bank account this month prior to me starting YNAB ( mortgage, light bill etc). Do I go ahead and put them in the budget this month or add into May's budget?
Hope this makes sense! Thank you so much in advance
Hello, Salmon Horn ! Welcome to YNAB!
If you pay your card in full (or pay the statement balance but never carry an interest-bearing balance), you'll want to budget for your starting balance immediately. You always want your budget to look like the figure below: one dollar set aside in your budget for every dollar you owe on your credit card bill.
Except for that credit card starting balance, you don't need to budget for anything that happened before you started your YNAB budget. Of course, you can budget for next month's bills, but if you paid your mortgage on April 1 and started your budget on April 15, there's no need to budget for that April payment—it already happened and the money is already gone!
Salmon Horn said:
just simply set aside the budget to pay the card (like you showed in the picture) in Aprils budget, and budget for the gas and cable starting in the month of May?
That's what you should do!
Here's a few other tips I wish I had known at the beginning:
1. Don't forget to budget to savings categories - if you already have money saved for something (emergency/loss of income, maintenance/repairs, vacation, a big purchase), put the big amount in there (a specific category) right now. This is not how much you will contribute each month, but how much you already have.
2. If you can already fund all of May right now, put that money into an "income for next month" category, then take it all out and allocate it sometime around May 1st. It makes things so much easier. Search the forum if you're interested in details on that (or wait until you get the hang of the software, no worries).
YNAB is great! Good luck and have fun!