Should I budget in the future when I don't need to?

I've been using YNAB since the YNAB 4 days.  We've been budgeting a month ahead since about 6 months after we started.  However, now, we're fortunate enough to be in a situation where financially we really don't need to anymore, and we can pull that money back in the current month and therefore put it to use faster.  I see that as a potential financial acceleration, since we can assign jobs to dollars faster than 30 days in the future.  Interested in the discussion - pros and cons vs each approach.  Thanks!

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    • nolesrule
    • Stealing From the Future fix is an improvement but is incomplete....
    • nolesrule
    • 2 days ago
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    In what way are you wanting to put it to use faster? And is it really all  sitting for an entire 30 days?

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      • briefcase
      • A rack of ties, a travel mug, telephone, briefcase filled with papers
      • briefcase
      • 2 days ago
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      nolesrule Discussions over whether dollar x is really sitting for 30 days notwithstanding, assume all money sits for at least one full month before use.  The example that I would give is that I could go ahead and whack the buffer and complete an emergency fund, for example, or some other large expense.  After which point, I would just budget each paycheck in their respective month.  At this time, functionally I really don't need to send each paycheck one month ahead in order to be financially stable.

      Capeesh?

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      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 2 days ago
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      briefcase if some other category is a priority that's going to be up to you. 

      We have multiple earners on different pay cycles so the ability to just aggregate and budget everything all at once simplifies the process for us. it allows us to see what the extra amount is going to be in that month at the start of the month and able to segregate it for whatever additional priorities we might have. You can't really do that with separate paychecks throughout the month budgeting as they come in because you won't know how much is left until they've all come in, and our last of the 4-5 paychecks is the last banking day of the month.

      In the grand scheme of things, the extra 30 days won't amount to all that much and in case of emergency can be reverted to paycheck to paycheck at any time.

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      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 2 days ago
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      briefcase and to answer the question in the post title.... there is no need to use the income for next month workflow. It's an administrative convenience to help manage the budget and is separate from financial cushions. So ultimately it is up to you.

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      • briefcase
      • A rack of ties, a travel mug, telephone, briefcase filled with papers
      • briefcase
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      nolesrule 

      nolesrule said:
      You can't really do that with separate paychecks throughout the month budgeting as they come in because you won't know how much is left until they've all come in

       Purely playing devil's advocate, with a buffered approach that is still true.  The difference being that when you decide what to do with those dollars while buffered, you assign the jobs 1 - 3 days in advance instead of immediately.  In that case, the 1 - 3 day wait time is arbitrary and arguably not very beneficial, when you could just go ahead and take care of the priority.

      I think we may be in a similar financial cadence.  We also have multiple pay cycles from two earners in the family, which means that we can cover items in the beginning of the month with a paycheck on the 1st.

      I haven't been gutsy enough to pull the trigger.  It's like taking a crutch away at this point, but the ability to put dollars to work 30 days faster to me is an intriguing benefit.

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      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 2 days ago
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      briefcase you can be our guinea pig. 😁

      The reality is getting rid of pushing it to next month is only going to be a one-time redeployment of one month's worth of income. I have no categories in my budget that need the money faster than they already get them, so the money would just end up in my brokerage account. And then I'd have to start thinking about the timing needed to put money into categories from each paycheck, which is something I don't care to do.

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  • The main purpose of budgeting ahead (this month's income for next month) for me now is ease of budgeting an entire month at once. I've been doing it this way for many, many years now and there is no reason to stop. I'll never go back to piecemeal budgeting.

    briefcase said:
    The example that I would give is that I could go ahead and whack the buffer and complete an emergency fund, for example, or some other large expense.

    That means nothing to me. Money is fungible. The funds are already available in an emergency. Even if part of your buffer.

    I will always budget a month ahead due to ease and visibility. Sure, when I get extra income like a bonus, I'll budget it right away. Otherwise, there is zero reason to go back to paycheck by paycheck budgeting.

    Just for conversation, I have wondered if the new auto-assign feature could possibly change my workflow to auto-assign each paycheck into next month rather than saving up this month's income into an Income for Next Month category and then releasing it after all income has come in for the month and then budgeting it all at once.

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      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 2 days ago
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      Superbone 

      Superbone said:
      Just for conversation, I have wondered if the new auto-assign feature could possibly change my workflow to auto-assign each paycheck into next month rather than saving up this month's income into an Income for Next Month category and then releasing it after all income has come in for the month and then budgeting it all at once.

       Auto-assign only works with savings builder and needed for spending (not target balance).... and needed for spending isn't accurate until the month changes over. So there's really no point in doing it as the money comes in because you just have to go back and fix it. That's why i use the technique to auto-categorize to INM when it comes in and just recategorize to RTA (TBB) once I close out the month.

      If goals/targets could be used as a template for 100% of my categories then it's something I'd consider.

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      • Superbone
      • YNAB convert since 2008
      • Superbone
      • 2 days ago
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      nolesrule Makes sense.

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      • Annieland
      • I was told there would be no math.
      • Annieland
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      Superbone nolesrule I am so confused right now and I’m sure my post in the big thread is buried. It’s payday, I have the check ready to assign in mobile (happen to be on iPad this morning) and I can’t find an option to automatically move it to INM category. It just says auto assign no matter where I click and says it can’t do anything because I’m fully funded this month.

      So I have to manually type in the paycheck now?? Guess I’ll go back to my computer where it’s easier there. This is SO weird. Suddenly no one is supposed to actively manage their YNAB budget anymore with EASE.

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      • Annieland
      • I was told there would be no math.
      • Annieland
      • yesterday
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       Ok I'm on a real computer now and it gives the Auto/Manual choice and I can move the paycheck normally.  I don't get it.  I have the iOS beta and maybe I'm supposed to be randomly checking for these changes but I don't think so.  I think they just do this stuff.  It makes no sense to me.

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      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • yesterday
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      Annieland apparently on mobile you can only manually assign money using the Move Money tool. Additionally they removed all the separate quick budget features.

      I don't use mobile other than transaction entry and for approving imported transactions. i find the small form factor not to be good for actual budgeting anyway due to limited visibility when performing functions.

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      • Annieland
      • I was told there would be no math.
      • Annieland
      • yesterday
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      nolesrule Yeah, I guess today was the first time I hit it.  I use the computer 90% of the time, the phone less than 1% (I can't do anything productive on a stupid little screen), and the rest on my iPad if it's what's nearby.  This should definitely be fixed.  They're always aiming for some kind of web-mobile "parity" and I never see it. 

      Like 1
    • Annieland It sounds like you used to tap on To be Budgeted and then type in the amount you'd like to move to specific categories. You'll still be able to assign to specific categories without using Auto-Assign. Now you'll scroll down to the category in question, and type (or add) the amount you'd like to assign right into the Assigned column. Does that do the trick for you?

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      • Annieland
      • I was told there would be no math.
      • Annieland
      • yesterday
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      Marisa Yeah, but I usually try to avoid typing in numbers in a phonepad looking thing, especially on mobile.  I like to just click on the top number and "move money to:" but I guess that's because I want to move it all to one category.  Now I have to look up and down and make sure I type the right number.  I just like to avoid one more darting from place to place to type in a number (most of the time it's unavoidable).

      It's so weird... it's like changes are supposed to be simplifying things for people with robotic type moves, and yet overcomplicating for everyone else.  And the people being targeted for automated simplicity are probably people who should be more manual in the first place.  I know, I know, I gotta submit overdue feedback.  YNAB is just stressing me out for at least 3 months now where it used to be fun.  I find myself avoiding budgeting and discussing it which is just bizarre.

      Like 2
    • Annieland I hear you - we all have our preferred ways of doing things in the web and mobile app (I had to find an old copy to understand how you used to do it 🤦‍♀️ 😅- I do almost all of my assigning in the web app). It's tough to change your workflow. When you're up for it, a detailed Feature Request is the best way to get your thoughts into the hands of our Product team! We really appreciate your efforts and feedback.

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    • briefcase
    • A rack of ties, a travel mug, telephone, briefcase filled with papers
    • briefcase
    • 2 days ago
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    nolesrule said:
     Auto-assign only works with savings builder and needed for spending (not target balance).... and needed for spending isn't accurate until the month changes over. So there's really no point in doing it as the money comes in because you just have to go back and fix it.

     This.  I think one of the benefits of per pay budgeting would also be that you're not fighting against the target/goal behaviors, and instead just embracing them.  If it were easier to handle some of my categories with the existing functionality, maybe.  Just maybe.

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      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 2 days ago
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      briefcase That's why I categorize the income to a Next Month category and just release it back to Ready To Assign (still getting used to the updated terminology) when the next month starts. By having the month walled off I can have my nominal budget already set up in August at the beginning of July by copying over the beginning of the month Budgeted/Assigned values and then tweak the categories that may be underfunded due to scheduled transactions or a 5th week.... all without having to worry about SFTF.

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      • briefcase
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      • briefcase
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      nolesrule For clarity, my current workflow is to just assign all income to the following month's tithes category, then when the month roles over I multiple that category's assigned value by 0.1 and then auto assign the rest (to use the new verbiage).

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      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 2 days ago
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      briefcase that's creative. 👍

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  • briefcase said:
    I see that as a potential financial acceleration, since we can assign jobs to dollars faster than 30 days in the future.

     You could only do this once, I think. Next month’s expenses are kind of like an extension of an emergency fund, spending the money “faster” would make your “emergency fund” smaller. Once that reduction is spent, I don’t think you’re going to get it again next month. This isn’t necessarily a bad thing, but I think it’s part of the “negative” trade offs.

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      • briefcase
      • A rack of ties, a travel mug, telephone, briefcase filled with papers
      • briefcase
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      Breau That's exactly why I would just absorb the buffer as emergency funds.  Not that it's necessarily going anywhere, it's simply that all future income wouldn't have to sit around until I use it, and the decision is reversible if it needs to be.  

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      • Ceeses
      • Ceeses
      • 2 days ago
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      briefcase You still end up with the same amount of money sitting around. Let's take some hard numbers. Let's say you have right at the start of the month before budgeting for the month:

       - Emergency fund(s) : $4000

       - Income for next month : $1000 waiting to be assigned

      So now, you have $5000 waiting around. $4000 waiting for an emergency and $1000 waiting for next month.

      If you pull your income for next month into your emergency fund, at the start of the month you have:

       - Emergency fund(s): $5000

       So now, you have $5000 waiting around. Same amount. Just all in one pot instead of 2. And you have to assign the money during the month as you get it, so you have more budgeting events to go through which would take more time during the month.

      So what does that give you?

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      • Superbone
      • YNAB convert since 2008
      • Superbone
      • 2 days ago
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      Ceeses That was the perfect way to sum it up. What does it buy you exactly? Turns out nothing. It turns out it’s just a mental exercise once you get ahead. I’m already maximizing my interest by keeping a minimum with wiggle room in checking and the rest in “high yield” savings.

      I’ll stick to budgeting a month at a time, thank you very much. 😀

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      • Ceeses
      • Ceeses
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      Superbone Actually my question at the end was genuine. I wanted to explain for me it would just add some work. But I was genuinely interested if the OP could see an advantage to themselves. I've been around enough to know people overwhelmingly find INM to be the best way to go in all financial circumstances, but there might be psychological advantages or other advantages we haven't thought of that might be worth knowing about.

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      • Superbone
      • YNAB convert since 2008
      • Superbone
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      Ceeses That's fine. However, I agree with your assessment that it's just a mental mindshift. To answer the OPs issue of wanting to put the funds to work quicker, it's just as quick sitting in INM as it is sitting in an Emergency Fund. It's also just as valid of a job and they happen to be interchangeable if you no longer want to assign an entire month's budget in one fell swoop and go back to budgeting paycheck to paycheck. 

      I also wanted to point out that it has no effect on the funds working for you outside of your budget, as far as returning interest, either. Now, I suppose if you wanted to invest those dollars in equities instead, it would give you a 2-3 week head start on time in the market. However, I want a certain amount in cash anyway so for me, even that wouldn't make a difference. It doesn't matter to me if my cash is sitting in INM or my EF.

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    • Ceeses I've seen people who really find satisfaction in specifically funding individual categories in the future with each paycheck.  

      This seems to be the case most often when building up to being Buffered. I can see the psychological benefit of multiple, specific wins, though for me it turned to busywork even before I knew how to circumvent SFTF.

      So, as a scaffolding step, I think it can have merit. Despair does no one any favors. 

      However, I think Herman said he likes being really in touch with the details of his budget, and does enjoy budgeting each paycheck individually in the future. That was over a year ago, so I'm curious if it held up over time. 

      For me, I'm glad to spend my time philosophizing/helping people on the forum (or a myriad of other things in life) instead of messing with my budget all the time.

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      • briefcase
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      • briefcase
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      Ceeses I think the one and only reason why I would consider it would be time.  In principle, I'm calculating that I could potentially make as much as 4 - 5 months of progress in a few categories in the space of one month while not really hindering myself much at all.

      For clarity, and since other people have mentioned similar stories, I was laid off last year due to COVID (YNAB win for sure!), so this isn't a route that I would take without a ton of consideration.  Hence the topic.  

      This question isn't meant to be a my-way-is-the-end-all-be-all-process type of question.  Everyone has different needs and is living a different story.

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      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
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      briefcase I'd just take it out of the emergency fund category (or income replacement or whatever you call it) if i that's what i was trying to do. As was mentioned before the money is fungible, but taking it from the EF is limited to a change in priorities (don't need to hold as much cash in reserve) whereas killing the buffer results in a functional difference that many of us would be hesitant to give up.

      In fact, in case of loss of income, I'd deplete my income replacement category before giving up the buffer. That's how useful I find the functionality. But that's just me.

      Like 3
  • I started using the INM workflow in January 2020. Twice since then has our income decreased. Twice since then has our income increased (alas, not back to the same, but hey). We've had other inflows to incorporate (tax refund, stimulus). 

    For the income changes, we had 6+ weeks to figure out what cuts were to be made and practice living them out before we were truly put to the test. For the increases, we could take our time debating which of the categories in need would get more.  For the one-off money, we similarly were able to let it sit instead of impulsively deciding. If you have so much money that time doesn't maximize your decision-making process (because you have extra a lot, or everything is always funded to the max), then maybe it doesn't matter to you. I know it's been beneficial for us. 

    I do also appreciate not having to check that I did things correctly from a management perspective. 

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    • WordTenor
    • Can we agree that goals are dumb and immature? Sure.
    • WordTenor
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    One month, yes. For ease of decision making. Further? No. 

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  • As far as an on-topic reply in the thread, I assign my future month in a 3 step order.  First I un-assign(?) a 6th of my deferred income categories and use that to fill as many category targets as possible.  Then I do the rest from last month's income.  Whatever is left I put into a this month Holding category to cover unexpected expenses, new priorities, or (oops) overspending.  At the end of the current month whatever is left in Holding gets moved to a larger savings or spending category.  Many may move it to investments.  That would probably be your "unneeded" money that you'd like to put to use now?

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      • briefcase
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      • briefcase
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      Annieland Negative.  I've been a month ahead since February of 2015, so I have a fairly workable and understandable process that I follow, and trust me when I say that no dollar in my budget is 'unneeded' 😉

      My premise is that my sacrificing the buffer and going paycheck-to-paycheck I could get about 4 - 5 months ahead on certain goals and not really be much worse off due to my pay schedule.  The rest of the thread is hemming and hawing on the pros and cons of that approach.

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      • Annieland
      • I was told there would be no math.
      • Annieland
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      briefcase I have a bit of a YNAB-induced headache this morning, so forgive me if my reply is pointless, but I wonder if that's kind of like when I took everyone's advice and started paying CC statement balances on the due date instead of on or about the closing date.  Everyone said I'd keep my money longer working for me.  Ok, I suppose that's true, because I'm currently staring at a gargantuan balance on my Amex card right now that dwarfs anything I've ever seen, and now I'm looking at it for nearly two months.  But okay, it's still in my savings account, yay.

      But my actual point is, perhaps that 30 day "payoff" is really a "one-off"?  In the end, everything is month-to-month anyway.  So you take the 30 days of money you would have put next month into this month, and then that's it.  It's not like every 30 days you're gonna have another extra 30 days worth of income to play with this month.  It's just a change in workflow as I guess most of us said, up to you, no harm done :).

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      • briefcase
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      Annieland It absolutely is a one-off event, unless and until I rebuild the buffer.   Where we find ourselves right now, that trade-off is looking pretty good though.  There are a few large purchases we need to get to saving for and trading a little convenience for speed can look very enticing sometimes.

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  • briefcase said:
    There are a few large purchases we need to get to saving for

     I could buy this rationale, especially at this point in time.

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