Budget Checking only
How do you budget the checking account only. I do not want the savings and checking combined as total dollars available to budget.
Simple solution: Just don't put the savings account into YNAB. Yeah, you can make it a tracking account; but if the idea is that you're budgeting checking, transfers from checking to savings look like spending to the budget, and transfers from savings to checking look like income to the budget, there's no need to have the savings account in the software at all.
Someone might ask, "Why would transfers from checking to savings be spending?" They would show up that way if one of the things you want to do is budget for savings. You would have a budget category of Savings, budget funds to that category, and spend it by actually transferring dollars to the off-budget savings account.
When I was working, I did this with an investment account; it was an easier decision to leave a brokerage account out of YNAB entirely, because YNAB can't deal with fluctuating stock prices and keeping the value up to date in YNAB would be more labor than it's worth. The value of the budget with respect to investments was to tell me how much I could afford to send to that brokerage account. Now that I'm retired, this situation happens in reverse; the brokerage account sends money to checking, and that is income for my budget.
The recommendation is to keep your savings accounts on budget. If you keep them off budget, then either you have a lump amount in a savings account that you aren't really dividing up, and can't determine exactly what it's for. And if you are using multiple accounts to track different purposes, well that's just complicating things that you could simply do with categories in your YNAB budget instead.
The other complication is what happens when youaren't using savings accounts in your budget but you need to use the money for something you were saving for. When you save the money, you have to move it out of your budget... requiring a category.
So what happens when you need to spend your "savings"? You aren't actually spending from the savings account. Most likely you are using your checking account or a credit card... but that money isn't part of your budget. So if you spend the money, you now have an overspent category, and you have to transfer money back into your budget to cover for it.
So it means your act of savings is categorized as an expense because the money leaves the budget, then you have to un-save it with a category to bring it back in, and then categorize the actual spending. This gets messy and unless you do it right you will have messy reports that may not reflect your actual spending numbers.
Or, you could just keep your savings on budget in categories, and when you spend it use your checking or credit card to spend it. Then, if you need the money in your checking account you can just transfer it with no category.
And even better, you may not need to transfer money at all, since you can cash-flow your checking account from new income. In my 4 years of using YNAB, I've actually only had to pull money back from a savings account 3 times. I've been able to cashflow everything else.
This is a good read:
I did a whole budget with savings and then realized it was making it complicated. My savings is really JUST an emergency fund (if I lost my job) so I was seeing it on the books and then was moving it off the books into a line item called "Emergency Funds" seemed goofy and too easy to "borrow" from.
So I created a NEW budget and removed all that noise. Now I am happy.
NewYNABer BostonGirl said:
My savings is really JUST an emergency fund (if I lost my job) so I was seeing it on the books and then was moving it off the books into a line item called "Emergency Funds" seemed goofy and too easy to "borrow" from.
I have a hard time believing that. You're not saving money for anything at all?