After my first week of YNAB...
I absolutely love this! Had a hard time with "only budget the money you have". I was thinking "what the heck! I am getting paid in just one day and I know exactly how much it will be.... Please, can't I put it in now? Oh, all right." I am always forecasting with my imaginary money. I now have a better grip on my true expenses after completing my budget and expect as time goes on I will be more accurate with my spending predictions for those categories. I also love the fact that I am spending money that I have, not money that I will get in a week - it is so much less stressful. I am looking forward to being able to fund all my categories three months out.
Congrats! However, many here would advise against funding categories three months out. Instead, we fund next month with this month's funds and keep a category with x months of salary/expenses. The problem with funding x months out is that when you follow Rule 3 and roll with the punches, you then have to modify that category in all future budgeted months.
I am always forecasting with my imaginary money.
We used to have what I would call "magic money". This is when my husband would justify spending on something based on future income/reimbrusement/bonus. The problem was he would justify spending something else later using the same money. Magic money. We did the Dave Ramsey thing previously and so we would budget a month at a time. We are both on salary so it remains consistent. But then we realized we were living on a credit card float. So now we budget each paycheque as it comes in. We are not quite a month ahead (one pay ahead) so if pay is on the 5th but mortgage comes out on the first, we are ok. Didn't used to be like that. Used to be "don't buy a coffee today or the mortgage payment will bounce". I like the present situation better. It does seem like overkill since our pay and our expenses don't change a lot but it keeps it real. Budgeting the part before the first paycheque of the month is usually pretty simple since we have to cover the mortgage plus a couple of other non-negotiables like food. The first pay is then used to complete the month as much as possible. Second pay reimburses the Month ahead category and is dispersed as the priorities of the month dictate. Keeps it real.
I've been using YNAB for just over a year now, and it has been quite a journey. It still is quite stressful as I'm focused on paying down a large debt - I want to get it cleared ASAP, but YNAB forces me to look at it objectively and not pay down more than I can actually afford.
I totally get the payday thing - I get impatient and want to put the money in right away, but I now look forward to Payday more because I get to fund my categories in YNAB, rather than think: "Thank goodness Payday is here... I can eat again!"
I also look forward to credit card payment day as I can see the difference it's making across all my debts, and enjoy that little feeling of satisfaction that I've paid off some more of my debt that's never coming back.
I hope you stick with YNAB long-term, I've found it to be a bit of a rollercoaster of emotion - some months I look at the budget and feel down because there's nothing left for "me", but then I have to remember that the most important thing is that all my essential outgoings and my long-term plans are covered.
A top tip I learned from this forum, is to create a "Stuff I forgot to Budget For..." category and fund it. Starting out, there will inevitably be things that jump out at you: that Subscription you forgot about, the pair of favourite shoes that fall apart, Auntie's birthday that completely slipped your mind. WAM from the "Stuff I forgot..." category and then create a new category for that forgotten expense.