Starting Balance in checking shows as income

When I opened my checking account I was asked for a starting balance. Now that shows up as income in my reports. How can I change that because the income for the first month is wrong?

 

Thanks,

jim

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  • "Income" is just new money coming into your budget and categorized as To Be Budgeted. The source doesn't matter. Since you are just starting, the balances of new accounts you add are income in that sense.

    For reporting purposes, you can change the date on the starting balance transaction to October and ignore October in the reports... but if you are using the direct import, I believe changing the date of the starting balance will cause all other transactions since that date to import.

    Like 2
  • Hi Jim!

    nolesrule is absolutely correct! Your starting balance is seen as "income" because those funds are being added to your budget for the first time and it's what you have available to budget at the moment. Changing the date to October will move those funds to that month, but it will import transactions from then as well.

    In the coming months, your income will reflect only the funds you receive in that month and help balance out your reports.

    Like 1
      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 3 yrs ago
      • 1
      • Reported - view

      Faness at YNAB You know, the thought just occurred to me that the starting balance(s) in To Be Budgeted may be the reason so many new users think that they have to re-budget the money in all their accounts every month. I've seen that confusion time and time again over the years.  As a long-time user, I haven't watched any of the recent training videos or classes, but I think some of the training and/or documentation material needs to better emphasize the following:

       

      Money budgeted to a category stays in that category until you spend it or move it to a different category.

      It probably also should explicitly discuss the treatment of starting balances in a little more detail to alleviate confusion.

      Just my 2-cents.

      Like 1
      • ps56k
      • ps56k
      • 3 yrs ago
      • 1
      • Reported - view

      Faness at YNAB  I have the same general issue with YNAB - how to fence off some balance within the checking account.... like a starting balance, or keeping a minimum balance. 
      I am more and more NOT finding YNAB helpful in a couple of "budget" areas, like starting/minimum balances.  Another thing, is that ANY money left over from one month is considered "spending money" for the next month vs having it go to a "leftover savings" account.  Each month SHOULD be only concerned with that month's income vs expense...

      Like 1
      • Steve
      • sjb
      • 3 yrs ago
      • Reported - view

      ps56k Money left over from this month SHOULD be put to budgeting for the next month.  This is how you age your money and get off of the paycheck-to-paycheck cycle.  Ideally you want this months income to be funding next months (or even the following months) categories.

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      • Janelle
      • ynab_janelle
      • 3 yrs ago
      • Reported - view

      nolesrule Great observation! I'll make a note of this for the team!

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      • Katejo
      • katejo
      • 3 yrs ago
      • Reported - view

      nolesrule    I agree. I have come across that myself several times when answering questions.

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      • ps56k
      • ps56k
      • 3 yrs ago
      • Reported - view

      Steve  tnx for the reply - I can see the overall intent, but I personally would rather have a "budget" that reflects the monthly income and monthly expenses balanced against that income without dipping into any surplus or savings.  By using previous months surplus, that artificially inflates your spending capability vs getting a handle on the whole concept of living within your budget.
      I guess it all comes down to how a person should view or handle the surplus from each month.  It would appear that YNAB views it as "avail" and I would view it as "surplus" and should be tagged as "savings" or  something else not to be used next month...

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      • jenmas
      • jenmas
      • 3 yrs ago
      • 1
      • Reported - view

      ps56k If you have left over money in your Restaurant category at the end of the month that you don't want to spend next month, just move it to your House Down Payment or Costa Rica 2020 category. It's the "sweep" method of budget management. I have about 10-12 regular categories that I sweep at the end of the month, about 10 regular that I let build up, and the rest are more saving-type categories so I add money and add money are rarely if ever spend from them. Living within your budget means more in than out in general but looking at a single month in isolation where spending is high doesn't mean you have "failed" at living within your means.

      In March I'm having my HVAC replaced. It's gonna be a big old payment that will probably be close to double my normal monthly outgoings. But since I saved up the money to pay for it as of last February (had to put it off because I ended up being out of town so much for work there wasn't time in the spring and didn't want to deal with it in the summer).

      Living within your budget in the YNAB context is more about making deliberate choices with all spending with the understanding that spending $25 on a pedicure means that I don't have $25 to allocate to my new dining room chairs. But that's okay because I've had these crappy old chairs since 2000, so another month isn't going to kill me and getting that pedi will make me happy.

      Like 1
      • Steve
      • sjb
      • 3 yrs ago
      • 1
      • Reported - view

      ps56k Rule #4 of the YNAB Method is to Age Your Money and live off of last month's income.  You do this by taking the "surplus" money available to be budgeted after fully funding the current month and budget it into next month.   The idea behind Rule # 4 is to be fully funded for the month before the month starts.  This way, you're no longer relying on income that you earn that month since it's already covered from money you've already earned previous month.  It's the only way to break the paycheck-to-paycheck cycle, and it will take work, but trust me, when you get there, it's great because you know you have money in the bank to cover all of your spending for the current month and can use new income to budget into the future to further age your money.  Also, budgeting into the future will absolutely not inflate your spending capabilities because that money won't be reflected in the current months budget categories, because it's job is in a future, not current, month.

      Like 1
      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 3 yrs ago
      • 1
      • Reported - view

      And to take what @jenmas said  a step further I have many different methods for my "monthly" categories...

      1) Sweep all excess out at the end of the month

      2) Continue letting the balance build each month

      3) Continue letting the balance build each month unless a  cap is reached

      I don't let the balances build indefinitely on monthly categories.

       

      I use #1 for a category like groceries or monthly bills. I use #3 for the monthlies that have lumpy spending, for example clothing where we might not by anything significant for a month or two with minor spending but with seasonal changes and growing kids we might have to do some replacement.

      I also let the balance build with a cap for things like car fuel, electricity and natural gas, water which can vary based on many factors. I budget the 12 month averages, but use a spreadsheet to determine the max balance for the category, and reduce the budgeted amount if it hits the max for that month.

      I don't use #2 for spending categories. I always use #3 if it's a category I don't mind building up, because I only want it to build up so much before I feel it has too much. So some of the caps I have in place are 2 months, 3 months, 6 months, 12 months worth of funding, depending on the category.

      Like 1
  • Thanks for the advice. I changed the start date to last year and everything lines up now.

     

    Take care,

     

    Jim

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