Varying Amounts on monthly bills

I'm still in my 1 month trial and I've tried to look thru all the helps, but what do you do for bills that vary per month?  Example, Utilities - gas.  I averaged ours for the year and put that amount in  for the month but of course, it is cold and I went over this month.  Do I leave it in the red and it will eventually catch up or do I still take from another category?


Thanks in advance 

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  • I take the average over a year. The problem is when you start and are in the high end of a bills. In that case, I still budget the average, but once I get the bill, adjust the budget to cover it all. Sometimes that means pulling from another category (priority). 

    New YNAB won't let you keep it red and roll to the next month. It will either be added to credit card debt if you paid the bill on one, or be taken directly form TBB for the next month. YNAB4 lets you roll overspending, but nYNAB does not. 

    Under-spending does rollover however. So if you can, put a little extra in the budget for variable monthly bills when you can to cover the times when the bill is high. 

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  • One of the key ideas behind YNAB is that you want to "roll with the punches" and deal with overspending immediately, so you don't want to leave that category overspent. That money has been spent, and you want your budget to be accurate, so you do want to move money around from another category to fix the overspending.

    Going forward, how you handle variable categories is up to you... but one way or another, you shouldn't leave them overspent if you didn't quite budget enough. Depending on where you live, it's quite likely that you'll need to budget more per month than your usual average until the weather gets warmer. 

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  • Budget your 12 month maximum bill amount to begin with. Budgeting the average doesn't work unless the amount is cyclical and your first month is at lowest point.

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  • As a rule, I budget the average and cover any overspending.

    Since you're apparently starting in the "expensive" part of the year for this category, you have no surplus built up in the category. Unsurprisingly, budgeting the average isn't enough to avoid overspending. Therefore, budget extra (more than the average) as a pre-emptive strike against overspending. Looking back at this month's bill from last year for guidance is often useful.

  • Generally, you should never leave categories red -- Rule 3, right? Red is the warning that you sent off money that was earmarked for use elsewhere in the budget. That means that some other category doesn't have the money it says it has. Pick a category to take the hit and reduce its budget entry.

  • I look at my highest bill from the previous year and budget that. For instance, in Arizona my electric bill is highest in summer months. So that is what I budget for. Then in the cooler months it builds a buffer because I will have money left over in that category.

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