How does one month's budget affect another??

So I'm really confused about how my budget is carried through month to month. I've been on YNAB for a few years but still don't understand why things are rolled over this way and how to work with it / fix it.

Problem 1) Let's say, for example, I have a category called 'Spending Money' and I give myself $25 each month for whatever I want. One month I only spend $10. Logically, the next month that category starts out with $15 in it because I don't just lose that money if I choose not to spend it. However, what if I spent $30? My budget for that month shows that I'm overspent $5 but the category next month starts again at $0. I know that you're supposed to move money from another category to cover the overspending in the current month and this is what I do. BUT my husband really needs to work on staying in his budget so when he overspends a category I end up having to essentially give him extra money in the category that he overspent in order to balance the budget and then go in manually the next month to adjust for his overspending so that he can sort of see the impact of the overspending. Its not an accurate representation of what happened and he's having a really hard time seeing what's going on I'd rather just have the true category balance carry over month-to-month whether it be positive, negative, or zero. I feel like it used to do this automatically back when I started YNAB 5 years ago but it doesn't anymore. Is there any way to do this?

 

Problem 2) On the flip side of that, let's say I have my January budget all complete and everything is accounted for and now I'm working on budgeting in February. However, when I'm balancing my bank account / credit card transactions I'm still dealing with spending in both months. Inevitably I have to go back and adjust January's category balances (I like to zero out some categories each month) to match the actual spending we've done but my 'to be budgeted' just stays at zero no matter what even though I'm changing my category budgets! For example, I had budgeted $3,000 in my 'buffer' category in January to roll over to February but when I went back to adjust January I found that I could leave my buffer at $3000 or change it to $1000 and still have a '$0' showing in my 'To Be Budgeted' no matter what! Apparently the money that I've already budgeted and spent in February is being taken into account in the money available for January?? This makes no sense to me. I like the feature that tells me how much I'll have in a certain category after and upcoming scheduled transaction but I don't want my 'To Be Budgeted' to be affected by the future! Is there any way to stop this?

 

Sorry for the super long post. I feel like I can't really explain what I'm experiencing clearly so please let me know if I can clarify. 

Also, we do use credit cards but we pay the full balance each month so we have zero revolving debt, if that matters.

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  • I have this same problem. Sometimes I have forgotten to add transactions and they get auto imported on the next month, but the overspending is reflected in last months budget. I also see sometimes I didn't spend as much in a category last month, but last month dosen't have all the categories with available = 0. I would think it should automatically move any money from the category to the next month. 

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    • Slate Blue Pilot (2903ac015cdb) 

      Slate Blue Pilot (2903ac015cdb) said:
      I would think it should automatically move any money from the category to the next month

      It's a sense, it does this for cash overspending. Next months TBB is reduced, so you naturally don't budget as much.

      The difference is it's typically the LOWEST priority category that winds up with less money. This is much better than unilaterally picking on the previously overspent category -- you know, the one that was very recently important enough to ignore the fact that it was empty.

      Like 1
  • Gold Robot said:
    my husband really needs to work on staying in his budget so when he overspends a category

    Have him help decide from where to reallocate funds. What do the two of you delay (or even skip) because he ignored the budget? Casting his actions in terms of consequences makes it far more real/concrete.

    (I suspect this is also one reason why negative category balances don't carry over. The "I'll make it up next month" mentality is a slippery slope.)

    There could also be an issue that the category is underfunded relative to the importance of that category. It's very common that your understanding of importance improves as you use YNAB. A budget value based on your old/original perception of importance is not really the best choice.

    Typically, it's going to be a mix of these two. No one can afford everything they want. All you can do is try to afford the most important things. Find a balance.

    Like 2
      • Gold Robot
      • Gold_Robot.9
      • 1 yr ago
      • Reported - view

        dakinemaui , The issue is the overspent category is typically NOT important. Its usually something like my husband wants mcdonalds even though he has already maxed out his own fun money or the fast food budget. I've tried having him decide where the money comes from but the problem is that he has trouble reconciling the importance of saved money for the future. He'll just take that money from what we've set aside for our daughter's birthday in 3 months (or whatever it might be) and tell himself that he'll 'pay it back' to the birthday fund later. Except then it happens again and again and again. And looking back at each month everything comes out balanced and looking a-ok so the problem becomes invisible. He needs to see the negative in HIS category NOW so he can see that the money is gone. We've been on YNAB for 5 years now and this is still an issue for him. 

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      • Gold Robot
      • Gold_Robot.9
      • 1 yr ago
      • Reported - view

      dakinemaui I completely agree about consequences. Which is why I'd like the consequence to fall on HIM (his category) rather than the rest of us.

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    • Gold Robot Sounds like a tough situation, but I don't think running a negative category will help. Why would he stop spending at -$50 if he doesn't stop at $0? There are millions of people with the same mentality in a downward spiral.

      I'm certainly not an expert, but I'd say this is a behavioral problem, not a tool problem.

      Hopefully some others will come in with more insight into this mental side. Like dieting, it's a choice to eat the doughnut or not.

      Like 2
      • Gold Robot
      • Gold_Robot.9
      • 1 yr ago
      • Reported - view

      dakinemaui  It's absolutely a behavior problem. The thing is, the solution your suggesting (which is what YNAB wants me to do, I get it) is STILL a 'I'll make it up next month' mentality. It's just making it up to a different category.  To me, it makes so much more sense to be able to see and track the pattern in the category with the problem rather than spreading it around to other categories.  The reality is  the overspent category will just 'borrow' money from another category this month and then the next month it will 'repay' that category and have that much less in the problem category. The result is the same except that it forces the problem to hide because no account ever looks like it got overspent, even though it did. 

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  • Gold Robot said:
    I found that I could leave my buffer at $3000 or change it to $1000 and still have a '$0' showing in my 'To Be Budgeted' no matter what

    This is because you had more budget entries than you have dollars. The Feb To Be Budgeted was negative. The way things are supposed to work when you reduce a category in Jan is that TBB does increase (in both Jan and Feb). The problem, though, is that money immediately went toward clearing the negative TBB in Feb.

    Keep the future TBB at $0 and funds will show up as expected.

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  • Gold Robot said:
    we pay the full balance each month

    In that case, make sure each CC Payment category has enough available to cover the entire working account balance. Anything less means you're riding the CC float and is very common for new users.

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  • Gold Robot said:
    Feb was not overbudget

    I don't know of any other way that the current month's TBB would not increase if you reduced/deleted a budget entry in the current month. I am pretty sure a future TBB was negative (maybe March?), though you obviously cannot verify either way at this point.

    I'd say just keep an eye on it in the future.

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      • Gold Robot
      • Gold_Robot.9
      • 1 yr ago
      • 1
      • Reported - view

      dakinemaui you're correct! I had accidently budgeted in March by mistake! Corrected the issue there, thanks!

      Like 1
  • dakinemaui said:
    Have him help decide from where to reallocate funds.

     Someday I'm going to beat dakinemaui to the punch!

    Like 2
      • Gold Robot
      • Gold_Robot.9
      • 1 yr ago
      • Reported - view

      Matthew so is there no way to have a category roll over a negative balance into the next month the same way that it rolls over a surplus? I know YNAB used to operate this way.

      Ideally we would simply allocate money to cover the overage in the next month rather than the current month so really, all the numbers would end up the same in the end. The only difference would be that looking back, it would be easy to spot patterns of overspending in order to better address repeat behavior rather than having those months where overspending happened be hidden. 

      Ex: Let's say in January, I spend an extra $5 in my fun money that I don't have. So I pull that money from our Christmas budget to cover it and everything is balanced. Except if I keep that behavior up, soon we won't have money for Christmas.  That would suck. So in order to keep the Christmas budget on track, the next month I short myself $5 and give that to the Christmas budget. Fine I guess but seems like that's just reinforcing the habit of 'borrowing' from the future.  And then when we look back at our spending habits, it all looks fine.

      I would rather solve the problem by leaving my fun money at -$5 for the month and leaving the Christmas money alone. Then next month I get my regular fun money 'allowance' which is automatically $5 less because of the shortage from last month.

      Again, in both scenarios, the balances all end up the same. But in the second example, we can look back and immediately see the overspend and see where our problem spending habits might be so we can address them.  

      Obviously, if you have no extra money to save in a month, you could get in trouble not covering your overspending immediately, but it would be nice to have this option.

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    • Gold Robot put the nominal (original budgeted) amount in the category name. If the Activity exceeds that, you were over. There is no automated approach to carry a negative forward, because the intended operation is to reallocate in advance of overspending.

      Like 1
      • Gold Robot
      • Gold_Robot.9
      • 1 yr ago
      • Reported - view

      dakinemaui that would be one solution. Some months there might be extra money budgeted for a different reason though. I wonder if YNAB could add a second 'note' section on the categories that was specific to each month. I've had other times where I wished I could make a note of an unusual budgeting decision and that would be really nice! 

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  • Gold Robot said:
    Which is why I'd like the consequence to fall on HIM

    Joint finances and budget though. Yes he should respect the categories, but that budget value may not be realistic. There needs to be a balance. Possibly the true importance wasn't fully understood at the time.

    Reallocation should be in line with JOINT priorities. Ideally also done in advance so the consequences are know before it's too late to forego the purchase.

    Going to take discussion for sure. One of the joys of joint finances. 😉 Wishing you the best of luck...

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      • Gold Robot
      • Gold_Robot.9
      • 1 yr ago
      • 1
      • Reported - view

      dakinemaui uuugh, joys indeed ;) Thanks for the help!

      Like 1
  • I'd say another solution could be to make separate budgets for both of you. 

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    • FYI, this requires separate accounts. Most people are reluctant to use separate CC accounts because of the superior rewards on one person's card. Without separate accounts, charges would need to be tracked as reimbursements in both budgets.

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  • I'm new to YNAB and still getting the hang of things -- with YNAB and budgeting in general.   So I am definitely no expert.  🙂

    I had a similar question and I was wondering if targeted goals might help provide more visibility that something else was being impacted on an ongoing basis.  "Amount by date" goals look like they adjust amount to budget each month as you go along.  If I allocate less one month, I have to make up in subsequent months to keep things on track.

    E.g., if I setup a goal of $100 for Birthday targeted for 4 months away; it figures out $100 remaining over 4 months.  When I budget $25 this month, it's on track (green) and then next month it still says $25 needed to be on track ($75 over 3 months), etc..  But if I had to reallocate $15 out of it this month to something else and only $10 wound up budgeted this month, then it's going to be noted as underfunded (yellow) this month.  Additionally, then next month it's going to say I have to put in $30 to stay on target ($90 remaining over 3 months).   So when next month comes along and I try to budget the typical $25, it's going to remain underfunded (yellow) to reach the target. 

    Another thing that might help with visibility, is to add notes in the month and/or in the specific category itself.   It's not automatic, but maybe it could help as an indicator. 

    Like 1
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