Set a goal, saved, met it, swept $ into investment account

I set a goal in YNAB to save $25K for a new kitchen. I saved and met the goal. I won't be remodeling the kitchen for 12-18 months so I took the money out of my savings account and put it into a low risk investment vehicle. It earns triple what money market accounts earn now.

The problem is that when I did that in August, it looks like I have $25K in uncategorized cash spending.

I recorded the transaction as a $25,000 cash expense. I didn't know how else to do it in the YNAB way.

I do have tracking accounts so I can follow it's growth but they don't affect my budget.

How was I suppsoed to account for this transaciton?

Coincidentally, when it turned September, that $25K doesn't carry over, so it's no longer showing as if I have $25K extra to budget for.

I've been using YNAB a long time now, and I've never had a problem, but I've never saved $25K for a kitchen, so I want to make sure I didn't break the budget somehow.

I love using YNAB.

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  • You should record in ynab exactly what happened in real life. Transfer the money from your savings account to the investment account. You will categorize it as kitchen renovation. 

    Like 3
  • By definition, money leaving the budget is "spending" and requires a category. Specify the same category you used when saving up that money. As far as the budget is concerned, job well done.

    Like 2
  • I have a category called investments, where I would 'spend' that money from. Could also be 'money invested for future renovation'.

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  • Yes, unfortunately YNAB considers all outgoing dollars from a budget as an 'expense'... Investments are not really an expense, since they are still your dollars you're letting a company borrow to grow. I wish there was a better way to categorize investments, but I just do as the others have noted with a budget category called 'Investments'. Then when I'm looking at reports I uncheck that Investments category in the filters so I can see all my actual expenses only.

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      • MXMOM
      • MXMOM
      • 1 mth ago
      • 1
      • Reported - view

      Tomato Tape I ended up putting ALL my accounts on budget and setting up categories for the money in the investments.

      Like 1
      • dakinemaui
      • dakinemaui
      • 1 mth ago
      • 1
      • Reported - view

      MXMOM For other users considering this, plan on a category to absorb the market movements (either direction).

      It's a bit like having a spouse who doesn't enter their spending -- the longer you go between reconciliations, the more likely the account balance is off (and to a greater extent). 😆

      Like 1
      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 1 mth ago
      • 1
      • Reported - view

      dakinemaui My absorption category is roughly 40% of the money in my budget. Only 24% of the money in my investment account is from other than the absorption category, which really lowers the risk to the budget.

      Like 1
    • nolesrule I believe that would mean you've invested 53% of total budget funds. Equivalently, the "non-absorption" invested dollars comprise only 13% of total budget funds, to put a number on the risk to the normal (non-absorption) part of the budget.

      I'm surprised your absorption category is as high as 76% of invested funds, but you've been doing this a while and had time to hone in a good number for your level of risk. Thanks for those interesting data points.

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      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 1 mth ago
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      • Reported - view

      dakinemaui Pretty spot on. Actually the non-absorption invested dollar are a hair under 12%, but the difference was in the rounding in my previous post. The reason the absorption category is that high is it's essentially the Taxable Investing category.  65% of leftover funds each month go into the category, so it's not insignificant.

      Like 1
  • You already got great advice but I just wanted to say kudos to you! Great job on saving up for the kitchen renovation!

    Like 1
  • dakinemaui said:
    the longer you go between reconciliations,

     What, not everyone reconciles every day like me?  😄

    Like 2
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