Setting Goals for Fixed Monthly Expenses

Hi ,

I'm new to YNAB and I'm trying to figure out how to set goals for monthly fixed expenses, specifically those that are taken out of my checking account by the payee automatically on a given day of the month.   Should I use "Monthly"  or By Date"?   I built my budget part way through the month, so some of the bills had already been paid. So my guess is I would enter a goal starting in June, right?  

Also, I'm curious to know what folks use "Monthly contribution" for.  

Thanks!

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  • I use a monthly spending goal for those fixed monthly expenses. For monthly expenses that can vary, like my utilities, I use a monthly contribution goal so I can build up a bit extra during the low-cost months to cover the higher-cost ones.

    I also use monthly contribution for my “repairs” categories, like I know I’m going to have to get my car fixed at some point, I just don’t know when. So I toss a small amount in every month and hope I can build up enough in the category to pay for when my car breaks.

    By date isn’t precise enough to pick a date within the month.

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  • Khaki Network said:
     I built my budget part way through the month, so some of the bills had already been paid. So my guess is I would enter a goal starting in June, right

     Yes, that would work, so it won't ask you to fund the category this month when you've already paid it. 

    An alternative to goals is scheduled transactions, where you make a recurring scheduled payment from your account. In some ways this is easier to deal with, and will still be funded by the "underfunded" quick budget option. 

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  • I think a monthly fixed expense isn't a goal.  It's a recurring transaction, which is budgeted for.  You might have the 'goal' to get a better deal from your gas supplier for example, but that isn't the same as having a savings goal in YNAB, which is to build up the budgeted sum in the category from one month to the next, so like the other posters say, for car repairs, or could be for a holiday or to invest.

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      • dakinemaui
      • dakinemaui
      • 10 days ago
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      Good Intentions You can have a recurring transaction, which will create an implicit goal in the month of the outflow (effectively a monthly goal if it recurs monthly). If the amount is the same every month, this approach works well.

      However, you can also use a Monthly Contribution Goal to save a different amount each month -- for example, contributing the average amount to Electric will build up a surplus in the low months and draw from that surplus in the higher usage months.

      The more consistent you make your budget, the less work it requires.

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      • PhysicsGal
      • Nerdy female homo sapien
      • physicsgal
      • 10 days ago
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      dakinemaui said:
      The more consistent you make your budget, the less work it requires.

       Wow, I was literally just thinking that I need to just decide to try to make my budget more consistent to simplify it and make it less work!  I've been budgeting about a year now and I have been keeping a strict budget to attack debt, and recently to build an Emergency fund, though I still want to finish off the last of my debt.  But these conflicting goals are making me want to change things around, depending on what I feel is more important on any given day, and I'm kind of a tinkerer. 

      I should just make sure all my important goals are funded proportionally to how important they are to me in and keep it consistent and I will eventually get where I want to go, if I follow that plan.  And it will take a lot less work to get there and be a lot less stressful this way.  Thanks for reinforcing that idea.

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  • Khaki Network You asked about fixed expenses, and just wanted to add, you don't need to have goals in YNAB for every category.  So say if you are on an electricity or internet contract where the payment is fixed every month, the aim is to pay the bill reliably.  That's not a goal in YNAB terms, because you don't end up in time with any extra money in the category. (Sorry I used gas in my last example in the UK meaning - whoops that wasn't very clear)  Outside of YNAB you might turn the lights off more, or find a cheaper contract, true.

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  • Hey Khaki Network ! Welcome to YNAB! This quick short on Adding Goals from our video course has examples of each type in action.

    Creating a Budget Template can help with the setup process, and has tips I think you'll find helpful! It includes information about how to use Scheduled Transactions and Goals to plan for future expenses too.

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