What happens to old overspending?

We recently switched from the old YNAB 4 to the web app, and while it's good, there are some differences we are struggling with. In the old version, if you left a budget category in debt at month end, that category would start the following month in debt.

We've noticed that if we do that with the web app, the next month the category is zeroed and everything appears fine. Overspent in December shows as $0.00. But look back a month and there is a deficit. Where does it go? Surely we have less money now?

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  • Take a look at https://docs.youneedabudget.com/article/769-overspending, or YNAB's pre-recorded workshop on overspending https://www.youtube.com/watch?v=udRavpkoWlY, or Nick True's YNAB End of Month video: https://www.youtube.com/watch?v=jHcGY9SzzkA.

    Basically, what happens depends on the type of overspending. Cash/checking overspending, where money immediately leaves your budget, reduces the amount available to budget in the following month (just like YNAB 4's default behavior, I believe, if you didn't choose to rollover that debt into the next month). Overspending with a credit card means that you've taken on some additional credit card debt which will need to be paid back in the future.

    Ideally, you'd fix this by moving money around to cover the overspending. If it's credit overspending, and you choose not to cover it, you'll need to budget additional funds to your credit card category to repay that debt in a future month. 

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    • Ben Thanks, everything makes sense now!

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