What are your opinions on both my categories and goals? Looking to improve my perspective AND my budget.

Curious to think what you guys think of my setup. I use goals to remind myself how much I need to budget each month specifically instead of using the quick budget buttons. NFS = Need for Spending, TSB = Target Savings Balance. I'm very interested to see what you guys think of the goals, so I made sure to include them!

  • Credit Card Payments

    • Amazon Prime Card

  • Needs

    • Rent/Mortgage (NFS)

    • Electric (NFS)

    • Internet (NFS)

    • Phone Service (NFS)

    • Groceries (NFS)

    • Home Supplies (NFS)

    • Clothes (NFS)

    • Work Supplies (NFS)

    • Date Night (NFS)

  • Transportation

    • Car Payment (TSB)

    • Gas (NSF)

    • Auto Maintenance (TSB)

    • Bike Maintenance (TSB)

  • Insurance

    • Renters Insurance (NSF)

    • Auto Insurance (NSF)

  • Loan Payments

    • Student Loan - Federal (TSB)

    • Student Loan - Private (TSB)

  • Health and Care

    • Haircut (NSF)

    • La Bedroom (NSF)

    • Medical (TSB)

    • Dental (TSB)

  • Fun Spending

    • Travel (TSB)

    • Dining Out (NSF)

    • Gaming (NSF)

    • Movies and Rentals (NSF)

    • Outdoor Recreation (NSF)

  • Subscription Services

    • YNAB (NSF Yearly)

    • Spotify (NSF)

    • Amazon Prime (NSF Yearly)

    • Microsoft Office (NSF Yearly)

    • Google One (NSF Yearly)

  • Gifts and Donations

    • Mission Groups (NSF)

    • Church Tithes (NSF)

    • Gifts to Friends (NSF Yearly)

    • Christmas Gifts (NSF Yearly)

    • Parents Birthdays and Mother's/Father's Day (NSF Yearly)

    • Sibling Birthdays (NSF Yearly)

  • Long Term

    • Phone Fund (TSB)

    • Car Fund (TSB)

    • Investing (NSF)

    • 6 Month Emergency Fund (TSB)

    • $1,000 Emergency Fund (TSB)

    • House (TSB)

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  • I wouldn't use either. 

    The point of goals is to enable the quick budget feature. Otherwise, they are meant to remind you what you were thinking when planning your budget so that when you actually budget, you can act on it (decide whether that's still a valid plan).

    Your current set up may remind you of some things, but it won't help with the quick budget. 

    Target Savings Balance will not affect the Quick Budget without an end date. This goal is most useful, in my experience, for when I've reached a cap in a category. Say I've saved up $1000 in clothes. I don't want to keep funding it if it's not getting used, but I want to have it there for when we eventually replace shoes, work clothes, etc. If the balance drops below the $1000 target, YNAB will change the color to alert me that I might want to start filling it back up. 

    At least, that is how it used to work. I've seen recent reports of a bug with that one when contributions are involved. I don't know if it's been rectified yet. 

    So the TSB doesn't help save repetitive work with the Quick Budget tool by itself. However, if you add a date to it, it can be helpful with the Quick Budget process. You'll still need to monitor its calculations to make sure it's counting your dates correctly, especially if you're spending from it at the same time, or after it resets. 

    As far as the Needed For Spending goals, I find them ineffective. They don't calculate in real time, which means I can't use them to budget the next month until the previous month has actually ended. And really, if I'm being that reactive, I should probably wait a few more days for the end of the month transactions to come in, right? Ok, that was slightly sarcastic, but it's really annoying. They had such potential.

    The goal that, in my opinion, works the best is the Monthly Contribution. 

    Straightforward. I don't have to manually check the software. Any math I would have to do to establish amounts would need to be done with the other types of goals to make sure I set them up right anyways. 

    Then, at the end of the month, there are a few categories that I don't need to roll over, so I can "sweep" the excess into higher priority savings categories. 

    I'm sure other people like the goals you've chosen, but I think they're more work than they're worth. 

    • Move Light Sound Life 

      Thank you for the feedback! It's very good to hear how other people view it. I actually wasn't setting up the goals with the quick budget feature in mind at all...I haven't used it before, as I tend to manually fill in each category as paychecks come in. All of my TSB goals do have deadlines though, and I do like the idea of things like clothes (which I buy every 2-3 years) being on a TSB, because I don't want that balance to reach zero, but I also don't want it to increase forever.

      You're right though, I may have been thinking about it strangely. The TSB goals trigger more than once, and I was thinking of them as a one time thing (since that's what the description says, what with down payment or vacation as options). I could set my internet to be TSB instead of NSF. I was using NSF because my internet bill doesn't come on the same day (Spectrum doesn't support autopay where I live, so it's on me to pay each time). That way, at the beginning of the month, I'd dump $79.99 in there, and then when the transaction occurs, that amount would be reset to zero.

      What you're saying, with TSB, is that I could just tell it that I need to have $79.99 in there by the first of the month, right? And then when I spend the $79.99 on that month's internet bill, it'll ask me to refill it to $79.99 again in preparation for the next? Or will it not do that? That's what initially threw me off.

      Not quite sure if I'm fully following, so let me know if I'm off base here.

    • theBrokeCarpenter I'm sorry. I'm not the person to ask about the intricacies of goals. 

      When I used them, I spent a lot more time making sure my Target Savings Balance (is it called Builder now?) calculated correctly, since at that time, it only had a month granularity. 

      When the goals got overhauled (a year ago? More? Dunno.), I looked into them, figured they didn't help me, and took the opportunity to simplify what I already had. 

      The biggest way to simplify is to be able to fund the entire month's budget with last month's income. I do that all on the first, and the budget is pretty normalized at this point. I spend a total of about 30 minutes (that's generous) reconciling throughout the month and then setting up the next month's budget sometime before the first. 

      I'm actually considering taking goals out of my budget entirely, but that doesn't help you! I hope someone comes along that can better help you!

      Like 1
    • Move Light Sound Life I still really appreciate the feedback! Just because I like doing it one way doesn't mean it's not important to me to hear your way as well.

      I currently have the next three months filled out with income I've already made, and am ready to fill out another when the calendar rolls around. I may be a broke carpenter, but I'm a very very frugal one. Didn't really come to YNAB in a paycheck to paycheck situation...came to it in a "I don't want to manage my own spreadsheet" anymore sort of way.

      It's good to hear your view on using YNAB though!

    • theBrokeCarpenter In that case, you may be interested in this:


      You'll have more options, be economical with your time/work, and minimize human error by using the INM workflow in a Buffered state.

      It was when I became Buffered that I could simplify my goals. 

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    • Also, whether or not you choose to do that, you need to be aware of Stealing From The Future (SFTF), which is a lack of notification that you have overbudgeted. This only happens if you budget beyond this month, and if you know about it, you can guard against it. Otherwise, you may get to the future and find out your plan was infeasible.

      Because of that, the only reason I can almost buy for budgeting in the future (to hide money from yourself if you are building self-control) is rendered moot, as you have to keep checking on the future to make sure you're not in the red. 

      Instead of budgeting 3 months out, I'd have an Income For Next Month category plus another category to hold the sum of the other two+months budgets. Many of us call it Loss of Income, because normally there's new money coming in each month. This category is for when/if that stops.

      Now, if you have variable income, I'd suggest a Deferred Income category as well. I'll try to find the write up on that.

      Here it is: https://support.youneedabudget.com/t/83hkqpj/variable-income-dreaded-red-overspent

      You already seem to have the capital that would allow to you just set these workflows (INM, DI) up without extra saving, but if you find your loss of income category to be less than you want, using those workflows will allow you to really target and get after saving more. Really, those workflows give you greater clarity such that you can more easily target whatever your financial priorities are. Give them a try! Ask questions, and someone will help!

    • Move Light Sound Life I read through both of the posts you sent me (not all of the comments, but your primary ones where you explain things at the least).

      Luckily, I don't have that variable of income. I do get paid hourly, and some months I get more overtime than others. I do have those two categories, the $1,000 Emergency Fund, and the 6 Month Emergency Fund (which is just our average monthly expenses of $1,200 * 6). Maybe I am a bit too granular though, as I also have emergency funds elsewhere in the budget...auto maintenance, medical, etc. Things I do plan on spending money on. The $1,000 Emergency Fund covers those when I exceed the allowed balance in there. The 6 Month Emergency Fund covers us if my wife or myself loses our job.

      I really like your idea of the INM category. YNAB does tell me if I have money budgeted in the future, but you are correct, that little text is way too easy to miss. Since my wife and I are very frugal, we tend to overbudget for everything, so we haven't stolen from future months yet. But in the third paragraph of the "To Buffer or Not?" section, you name three big drawbacks, which I heartily agree with.

      I plan on making an INM category myself now instead of budgeting out to the future. If I click over to August, my goals tell me approximately how much we plan on spending in August, and then I can aim to fill the INM category with that much. I promise I realize the irony of this statement. I'm essentially using goals to create another goal...with the goal of having a buffer. I feel like if I didn't do this, I wouldn't know how much to put into my INM section.

      The advantage I see of moving to your method combined with my goals is that I know how much more I could invest in a given month. That money is sitting in a 0.2% interest rate savings account at the moment, and I could probably invest a few hundred more a month in Betterment, which is what I currently use (as I prefer a hands off approach). Hopefully, that would bump the interest rate up to an average of 9%, which I researched to be the average in the past.

      Both of those posts were extremely helpful, though I don't know if I'm using them in the way you intended me to...don't laugh, and I sincerely apologize, I can't seem to get it through my head without using goals. I promise I'm trying consistently to think differently about it!

      I think every YNABer should read those in the beginning though, especially those struggling with paycheck to paycheck issues or struggling with not blowing a ton of their variable income whenever a windfall rolls in. So thank you again for linking them!

    • theBrokeCarpenter Thanks for your kind words; I'm glad they helped you! Those are things I learned from others on this forum. 

      I do wish I'd more clearly explained SFTF instead of just alluding to it. It isn't related to overspending or being frugal. It is simply the fact that you can put $500 in a category in August while it's July, and then unintentionally also budget that same $500 in July without knowing it. This violates Rule 1 on a fundamental level. I got caught a few times thinking I had money available in the future without it being so.  They really need to make the global TBB global in real time (forget the past), not future-most oriented. It has such a potential to hurt people. 

      Regarding goals - the most important thing in my book is that you're researching the method and the software (you are), thinking critically about its application in your life (seems so), and thinking critically about facilitating your priorities (seems to be well established). Anyone who's doing that can make their own decisions (ok, actually I think it's important for people to exercise their agency in general) - I see my contribution as simply offering another perspective or presenting details that may not be known. 

      Even WordTenor says to not try goals *for a few months* until you get the hang of both the method and software as well as the rhythm of your own priorities. Since you seem well-versed in your priorities, you may well benefit from the fast-track lane. You'll continue to evaluate what works best for you, I'm sure. 

      You seem to use that $1000 Emergency Fund as the Stuff I Forgot To Budget For category, which can really help smooth out things that tend to surprise people the first year on YNAB.

      Good luck!

  • TSB (with a date) can be very useful if you have a known amount that you want to save by a certain date.  One example of how I use this is my Auto Insurance.  It is billed every 6 months, so I put in a goal (repeating every 6 months) to have it calculate how much per month you need to put in.  This can also be done simply by adding a Monthly Savings Builder (and manually calculating 1/6 of the biannual auto insurance bill)

    One benefit the TSB does have, though, is if you end up borrowing from the category to roll with the punches, the calculation will automatically adjust itself and figure out how much more you need to budget per month in order to still reach your goal by the end of the month.

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    • Bruce Right. I forgot that the old Monthly Contribution is now called Monthly Savings Builder. 

      It's like when people introduce themselves with one name and then later develop a nickname. It's so hard to get it right!

      I spent the most time poring over goals with the old names. When the new ones came out, I played with them for a bit and went back to the old ways. 😅

      And, to be fair, I've seen people have successes using the Spending Goal by a date that's not monthly, such as for Gifts or Vacation. I just have most of those types of categories combined to not have excess sitting in the category/need quite as high a contribution (though at the moment, that grouped monthly amount is pretty close to the simple sum/12, because of due dates and amounts, so it's hardly worth it).

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    • Bruce 

      That's why I have it set up for a house fund, phone fund, and car fund. These are things that I want to save a certain amount for by a certain time, so if I can contribute $1,000 in one month, I like that it adjusts and tells me if I can budget less the next month instead of driving me to a consistent $900 a month. Let's me accomplish the goal early without it hounding me to add more.

      I was trying to think of ways to use it for more of the categories that I currently have goals set up with NSF on, as Move Light Sound Life suggested, but I think I'm still a little confused as to how I'd do that. I know that groceries makes the most sense to me monthly or weekly with NSF, because I'm not making 1 grocery trip every 6 months. Not even 1 a month. But being able to spend from it without it telling me to replenish it keeps me in line.

      Maybe I'm still a little confused I suppose. What do you think?

  • I would use goals on almost zero of these categories, and for the ones I would, I would use monthly savings builder instead. Move Light Sound Life is spot on. 

    YNAB the company is very enamored of the goals feature and IMO have lost sight of the fact that it’s meant to be a budgeting aid in their onboarding materials. They’re neat little extra bells and whistles but they’re not that important. Budget your categories by hand for at least a few months before deciding what goal, if any, will best accomplish what you want to do. 

    Like 2
  • theBrokeCarpenter said:
    Maybe I am a bit too granular

     I don’t think the concept of TOO granular exists with this fun bunch. I, for example, have my gifts categories broken down by month with  annual repeating spending goals on each. I did that because I found that I get hit hard in the spring and a single gift category left me feeling vulnerable. I did the same with my sons university expense categories. I had a tuition and residence category for each term because I didn’t necessarily need the whole amount (all 3 years) at the start of the 1st year. Also the tuition was payable before the start of each term but many of the residence /living expenses could be funded over time. I have each of these under their own category group (GIFTS and UNIVERSITY). For the gifts one, I drag the just finished month to the bottom of the groups list just to keep them prioritized.  I put a screen shot below of the gifts category group. 
    i also use a Next Months Income category. I am only 1/2 month ahead right now.  I get paid biweekly but some expenses come out monthly (like the mortgage) so on the first of the month I empty NMI and allocate the things that have to be funded before the first pay of the month. Then that paycheque gets budgeted in detail and the 2nd pay of the month just dumps back into NMI. 1st of the month - most boring budget process.  

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    • MXMOM Those gift categories! 🤩I've been meaning to go more granular in this part of my budget as well. It's no surprise that birthdays roll around every year - and yet every year, my gifts category looks...not awesome. This looks great - thanks for the inspiration!

  • theBrokeCarpenter said:
    the $1,000 Emergency Fund, and the 6 Month Emergency Fund (which is just our average monthly expenses of $1,200 * 6). Maybe I am a bit too granular though, as I also have emergency funds elsewhere in the budget...auto maintenance, medical, etc. Things I do plan on spending money on.

     That's perfect. It's not too granular. Many YNABers do the same. As someone else has said, what if something large happens in all of those categories at once? A car accident could potentially have repercussions in auto maintenance, medical, and loss of income, and Murphy says the pet will get sick and the water heater will go at the same time. I mean, we hope that's not the case, but it's nice to plan if we can. 

  • theBrokeCarpenter said:
    know how much more I could invest in a given month

     Do you mean you'll budget some money in an "investment" category and "spend" it by sending it out of the budget to investments? Or do you mean you want to house some of your budget funds in a higher yield account? 

    If it's the latter, and if there is any risk, definitely look into Superbone and nolesrule 's ways of handling that in the budget. 

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