How granular are your subcategories?

I find that trying to create encompassing subcategories which might include such expenses as my wife's monthly Audible subscription and my own monthly Google Music subscription (among others) are frustrating because I can't truly see where the money is allocated. However, when I break out all of these expenses into their own subcategories, I feel like I'm overdoing it and start to get a bit overwhelmed.

Is there a balance others have struck? Is being fine-grained the point?

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  • I would say it is personal preference. If there is value for you in seeing everything broken down then you aren't overdoing it. You can have a category called 'Monthly Subscriptions' and pay them all out of that one if that works for you. I personally break mine down because it helps me to see exactly what I am paying. That is just me though. For instance, under my Monthly Expenses category I have a subcategory for Netflix and a separate one for Hulu. I also have a Yearly Expense Category that has my YNAB Subscription, Amazon Prime, Car Registration, etc as subcategories. I like to see where my money is going specifically but you can start with a more general category and see if that works for you. You can always break it down later if you need more details. Your budget will change as you see what works and what doesn't. They offer a free class called 'Customize Your Budget Categories'. You can get guidance from a YNAB instructor and more insight from others and how other people in the class setup theirs as well.

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    • Abby
    • Toolkit for YNAB Designer & Developer
    • abbydawn
    • 2 yrs ago
    • Reported - view

    I tend to be less detailed with expense categories that tend to relatively consistent month-to-month, and more detailed with variable categories that I feel I need to be more careful with or want to keep a closer eye on. I usually start with very general categories, and break things down as needed or as my priorities change.

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  • Coarse.  Mostly because I don't want to scroll endlessly through my budget.

    Best example is home utility bills -- I combine my water, gas, sewer, garbage, and electric bills into a single "Utilities" category (under the "Home" category group.)  If I want to drill into a specific utility I can easily filter/report by payee.

    But I have the luxury of being buffered -- I can afford to budget for my entire month right at the start of the month.  If I were living paycheck-to-paycheck, I might not have enough money to do that, and it might make more sense to break bills out into distinct categories so I could budget them in priority order (e.g. bills due early in the month have higher priority than ones due later in the month.)

    In the end it's personal preference. Go with whatever works for you.

    Like 3
  • I would agree that it is personal preference. In general, I very specifically list monthly and automatically withdrawn expenses and broad for variable expenses.

    For me, I categorize my budget in this way: 1) Transactions auto-drafted from my checking. 2) Transactions auto-drafted on credit cards. 3) Savings and annual expenses. 4) Variable. 

    Within the first two categorize, I specifically list each expense and include the date of the month it is charged and amount. This works for me. In my opinion, this helps anticipate cash flow. As I budget and work to transition from the credit card float to pay this month's expenses with last month's income, I pay close attention to what is being withdrawn from my checking account. I have to budget for these. The con for this method, I've found,  is in reporting unless you drill deep down.

    Roll with the punches and see what works best for you.

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    • WordTenor
    • Can we agree that goals are dumb and immature? Sure.
    • WordTenor
    • 2 yrs ago
    • 2
    • Reported - view

    If you’re trying to change it, granularity is helpful. If you are just budgeting for it, fewer categories makes that process simpler. You can always change what you’re doing in either direction (though note that you'll want to hide unused categories rather than delete them. )

    Like 2
    • casner
    • Now retired, and figuring out transitions
    • casner
    • 2 yrs ago
    • Reported - view

    Another consideration: Goals. I have tried both more and less granularity, but when Goals became a part of YNAB, I found a good resolution. I have a Goal for most categories If I merge too many things into one category, it becomes very difficult to set a goal for the combined category. So I break it apart to make the setting of goals easier.

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  • I've got 145 categories, but I split transaction my gross pay income transactions to account for every insurance deduction etc. and I have a line item for each annual membership and monthly fee. But then, I like interacting with my budget, so I'd miss the granularity.

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  • I keep my category list simple. For example I have one Utilities category,  if I need a breakdown of what utilities cost what I can further breakdown by payee.

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  • My decisions about granularity are always driven by the budgeting and not by any reports or analysis of spending after the event. I've recently split out all my subscriptions and memberships into individual categories in their own category group. We're trialling a different split of budgeting and, for now, I want to be able to see each of them with a due date for budgeting clarity for now. Once things settle I may well convert back to a generic subscriptions category with a set monthly payment but for now I want that visibility when budgeting.

    Conversely, I don't do what Coral Battery does with utilities but I could because they're fairly stable and easy to budget/set goals for.

    I'll be honest, I don't consistently use the reports. Every decision I make is driven by a desire to budget more effectively. 

    Like 1
    • monkeyhanger I also finds fewer categories easier to budget, rather than having to figure for 50 differest caregories but like it's been said u got to do what works for you...

      I have also moved away from uzi g ynabs goal function all together,  it has some odd behavior and the orange numbers are annoying imo. But im nearly too the point of being a full month ahead so on the 1st I can just budget everything,  usually based on last month's spending,  make some tweaks and im good to go.

      With my Utilities for example spending goes up in the winter,  but I'll budget a set amount each month and in the summer a small balance will remain unused and move forward until the winner months which i spend more than i actually budget but because i overbudget the rest of the year it evens out.

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      • monkeyhanger
      • No animals were harmed
      • monkeyhanger.1
      • 2 yrs ago
      • 1
      • Reported - view

      Coral Battery I don't always want quicker to budget but I do tend to prefer easier to budget accurately, hence me just choosing to split out the subscriptions after starting our new household split. 

      Speed of budgeting is probably quicker for me with it split - Tick the category header and budget unfunded. If I can't afford all that right now focus on the monthly balances and the closest annual ones.  Easy to see where I'm short on the ideal. Then collapse the category header and it takes up no more space on my budget.

      If I have just one category, I need additional info in the notes or a spreadsheet to do that calculation for me.

      As you've said, the beauty of YNAB is that you get to choose where you want to focus and for how long. I do a similar thing with vacations but here each trip gets its own budget category in YNAB e.g. YMB, Iceland 2020, etc while I'm saving up for it. This lets me easily assess whether we're on track for that break. All costs get recorded against that category. Once it is finalised, rather than hide the category, I do an all accounts search by category (e.g. YMB), tick all* and then edit to change the category to the generic vacation category and then delete the category. 

      All I was trying to add was that my decisions are driven by trying to increase budgeting awareness whereas others were driven by reporting.



      *If I'm bothered about being able to retrospectively assess how much each individual trip was, I'll note the total spent at this point and write it in the generic vacation category note. In the past, I would also use #YMB along with any desired splits e.g. #fuel, #flights, #hotels, etc since we have always followed the principal of putting anything vacation related into a single trip category. I haven't done that recently, since we look back so rarely that the effort to categorise it at input wasn't worth it.
       

      Like 1
  • Mine vary depending on how closely I want to track things or by how it makes sense to manage budgeting and goals.

    eg, I recently added Netflix and Apple Music into my internet category. They make sense together to me and they’re repeating monthly charges so a monthly goal still works.

    On the other hand, my children’s sporting and dance classes might make sense together but most payments are on different annual or quarterly schedules. So I have each one in an individual category so I can manage progress to the goals more easily.

    Like 1
    • Khaki Storm
    • YNAB book topics online: https://support.youneedabudget.com/r/q5w48j
    • Khaki_Storm.1
    • 2 yrs ago
    • Reported - view

    I am new to YNAB and in 2 months seem to be using about 45, but I have been budgeting for a lot time and many of those are from my previous budgeting software. I agree you want to avoid a misc. category with a lot lumped into it, like say Car Expenses vs Car Gas, Car Insurance, Car Repairs, etc. makes a lot more sense. However, if you go too far, then you'll be searching for categories all the time and finding yourself transferring $1.00 from 'lunch at work' to 'donation at work'.  Since my misc work expenses (lunch meeting, going away gift, fill up candy jar) are relatively low (I pack lunch most days, I buy candy on sale after a holiday, etc.) and many other things are covered by other accounts (gas, clothing, haircuts), then the misc. work catch all fits my needs. On the other hand, if I had a feeling buying shoes was draining my clothing category, then I'd create a separate shoe  category and track it for a while. One thing I like about YNAB, is if shoes are not the drain I thought they were after a month or two of tracking, then I delete the category and YNAB asks me to pick a category to merge all the transactions into, which I'd pick clothing and be back where I started.  

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