Best practices

Hello. As a returning YNAB user, I vaguely remember why I last time stopped to use YNAB 2 years ago. But now I have restarted (again) and I am wondering what might be the best practices/tips/tricks/processes when (my situation) we have both our salaries on the 15th of every month and most of our bills are 15th as well. There are no other significant income during other times and also only a couple of direct pay subscriptions during the first week of the month. So I have a basic knowledge about the SFTF issue and 2 years ago I set up the next month's income category. I know that YNAB is a zero-based budgeting envelope tool and so on. And fluid budgeting between months. Obviously I have to budget 15th when money comes in, but only to the bills and for the rest of the current month. Then put the rest of the TBB to the NMI category. And then again make budgeting at the beginning of next month and release money from the NMI category to the TBB and make sure I cover all categories at least for the two weeks. And when my "reserve" grows I can continue to budget the next bills (starting those which are due 15th). Is there anything wrong with my budget process or are there any other tips for us?

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  • You're process sounds fine. One goal might be to get to classic Rule 4, Live on Last Month's Income. In your case, you'd only need to get half a month ahead. It would look like this: Both of your checks on the 15th go into NMI, then at the start of next month (or very end of this month) you would release these funds and budget the entire month. Alternatively, you could just skip the NMI go between and just budget next month when you receive your checks. In this case, you'd need to be more cognizant of SFTF after this point each month.

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