How do I verify that my savings for an item is really there?

I've been doing YNAB since February and have watched countless videos, but my money in savings has never matched what YNAB says. My accounts are a huge mess, and I constantly am off--sometimes by hundreds of dollars--between what YNAB says I have and what my bank says I have. I'm thinking I should just do a Fresh Start, but I still have no idea how people feel confident that when they've saved for specific items (and I have about ten of those categories), the money is really there.  Between vacation spending, credit card spending, and irregular extra money coming in, I don't feel like I have control of this budget at all. 

Before I leave this and go back to my envelope method with multiple different savings accounts, does anyone have advice on how to rectify my accounts? I'd like to do a fresh start and try one more time, making sure my balances always match YNAB in the way that my checkbook register balance matches what the bank says. I think I am missing something.

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    • WordTenor
    • Can we agree that goals are dumb and immature? Sure.
    • WordTenor
    • 4 mths ago
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    The tl;dr is that YNAB doesn't screw this up. If it says you have the money, and your accounts are reconciled to the bank, you have the money. It just might not be in the account you're thinking it's in: over time, you will learn not to think of money as being "in" a particular account. 

    This is how you make sure for yourself that the budget is correct, but it's not wrong. 99.9% of the time when a user thinks something doesn't add up, it's a misinterpreation on the part of the user.

    The key thing to understand is that YNAB works independently of your accounts. This can be hard to grasp if you're used to budgeting by account; however at the same time, a history of budgeting by account can be helpful because you're used to abiding by "$X are for X purpose" as a standard. The big mental shift you have to make is that now it is the category that tells you that, not the account balance.

    When you have multiple accounts in YNAB, making a purchase is a two-step process:

    1. Do I have enough money in the category?
    2. Do I have enough money (or credit limit) in the account I want to use? 

    If the answer to #1 is no, you need to move money from another category. If the answer to #2 is no, you need to move money between accounts, or use a different account. In practice, you get to a place where #2 is a question you handle once a month or so by ensuring your checking account has enough in it for any checking transactions, so for day-to-day spending you're only asking #1. 

    This is the bible on accounts vs. categories. Read it a few times, and I recommend making a brand new sandbox budget and following along with it as you read.

    Like 5
  • Yes, you’re definitely missing something.

    NancyM333 said:
    My accounts are a huge mess, and I constantly am off--sometimes by hundreds of dollars--between what YNAB says I have and what my bank says I have.

    This is the root of your problem. You can’t allow this. Your cleared balance needs to match your bank’s online cleared balance at all times. And to be really on top of things, your working balance should always be correct too. This included all transactions that you’ve made but haven’t cleared through your bank yet. 

    I would recommend that you reconcile your accounts once a day, every two days max, until you’ve got a handle on keeping your accounts accurate. I’ve been YNABing for over 10 years over different iterations of the software and have always kept them in sync. Occasionally when I check the bank balance, there will be a discrepancy in which case I’ll have to do a one to one comparison of my transactions since my last good reconcile with the bank’s records. I do this until I find the discrepancy and fix. Worst case, you’d make a reconciliation adjustment but I’ve never done that in my 10+ years. I always find the difference and fix.

    How are you entering your transactions? Are you relying totally on direct import? If so, you’ll always be a little behind.

    Like 2
  • Yes, the budget audit linked above should be super helpful in reassuring you that your budget is trustworthy! I wanted to emphasize step one of that process: reconciliation.

    Since the amounts in your budget are directly impacted by the amounts in your cash-positive accounts, it's imperative to keep those up to date and reconciled! As long as your accounts are reconciled, then you can trust your budget.

    It can be a trick to get into a good reconciliation rhythm (this help doc on finding your cleared balance might come in handy), so let us know how we can help along the way! 

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