Transferring money from Savings to Checking

I have two bank accounts on my YNAB budget - a savings and a checking. I am going to buy a car so I needed money from Savings to add to my New Car category. I transferred the money and I understand now why I couldn't categorize it so now I have a deficit in the New Car category. The forums, blogs and other YNAB support has been so great helping me understand about the money going from the left pocket into the right. However, now I can't find an answer to how I resolve this. Do I close the Savings account and just not have it on my YNAB budget and then add the money through the Checking account as income so I can apply it to my New Car category? If so, when I close the account, how do I deal with the balance?

28replies Oldest first
  • Oldest first
  • Newest first
  • Active threads
  • Popular
  • Transferring money between on-budget accounts does not affect how much you have in categories. Closing out the account and having the money as income also should not affect how much you have in to be budgeted, except to make it negative - if you're taking the savings off-budget, you're removing that money from the budget.

    How much did you have in the New Car category before you made the xfer/purchase?  If it was not enough to cover the cost of the car, then you need to move money from other categories to cover the overspending in that category. But the money needs to be moved around in your budget categories, not just between bank accounts. Moving money between bank accounts does not affect how money is distributed in your budget categories.

    Like 1
    • nolesrule
    • Stealing From the Future fix is an improvement but is incomplete....
    • nolesrule
    • 3 mths ago
    • Reported - view

    Unless you are closing the savings account in real life, you would not close it in YNAB. The money in your accounts is the money in your budget. If you want to change the job you've given your money to something other than what it is currently assigned in your budget, you would move money between categories.

    https://docs.youneedabudget.com/article/126-moving-money

    Like
  • Thanks. That all makes sense to me but...since the money I transferred from Savings to Checking didn't go to TBB, I don't have enough money to shift around to put in my New Car category. Where would that money come from? I'm so confused 😜

    Like
      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 3 mths ago
      • 1
      • Reported - view

      Navy Blue Welder you would need to take it from your other categories, because you had already put that money into your other categories.

      As I stated above, the money in your budgeted is equal to the money in your accounts. So if you need more money in a specific category, then you need to move it from other categories.

      Like 1
    • nolesrule But that's the problem -- I don't have it in other categories. In reality, I moved $5000 from my Savings account to my checking account so I could write a check to the dealer. But in YNAB, I shifted the money and I can't put that $5000 in my New Car category so it's not showing up anywhere. I don't have enough money in my other categories to put in the New Car category.

      Like
      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 3 mths ago
      • 2
      • Reported - view

      Navy Blue Welder well, the money is there in the budget. What you are actually saying is you can't move it from other categories because you need it to stay in those categories, not because the money isn't actually in the budget.

      What that means is you don't have the money currently to pay for the car while also being able to afford your other necessary expenses.

      Like 2
    • nolesrule But in real life, I do have the money so is there no way to have that reflected in my YNAB budget? Thank you for your patience. I feel so dense about this. I love YNAB and understand many things about it but this has me completely puzzled.

      Like
      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 3 mths ago
      • 1
      • Reported - view

      Navy Blue Welder Let's try this again. YNAB is an envelope budget system. it takes all the cash in all your accounts in the budget and puts it into TBB. You then take money from TBB and put it into other categories. So every dollar that is in any of your budget accounts and is not still in TBB is assigned to some category in your budget.

      YNAB doesn't care which account the money is in when you are putting it in your categories.

      So now you need $5000 to pay for a new car, but your new car category does not have $5000. That's because you put that money from the savings account in other categories. Maybe it's groceries or gas for the car, or insurance or restaurants or emergency fund or all of the above, or maybe you flipped ahead to a future month and put it in categories there.

      One way or another it is already in your budget, it's just not in the category you want it in. So you'll need to remove it from categories  in order to put it in the new car category.

      If you don't have the wiggle room in your categories to move the money because you need the money where it is, it means you don't have the cash right now to buy the car because you need to keep it for the currently assigned categories.

      Like 1
      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 3 mths ago
      • Reported - view

      Navy Blue Welder Lastly are you sure the savings account was a Budget account in YNAB and not a Tracking account?

      Like
    • nolesrule Okay, that is so helpful. Thank you. I wonder then, if whenever I put money in my Savings account I should have been categorizing it. How do I know the difference between a Budget account and a Tracking account? I don't which one I have.

      Like
      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 3 mths ago
      • Reported - view

      Navy Blue Welder in the account list there are two sections and they are labeled Budget and Tracking and have accounts listed below them. Transfers from a tracking account to a budget account require a category because money is moved into the budget. Transfers from a budget account to a tracking account require a category because money is leaving the budget. transfers between two budget accounts or between two tracking accounts do not need categories because there is no net change to the amount of money in the budget.

      If the savings account is a budget account and you have been transferring money to it from your checking account, then you need to realize that the money is being assigned to categories when it comes into the checking account and that the transfer to the savings account is just moving the money to a different account. If, on the other hand the money is being added directly to the savings account (like from a split direct deposit), then the inflow to the savings account would put the money into TBB and it would be assigned to categories.

      Like
      • jenmas
      • jenmas
      • 3 mths ago
      • 2
      • Reported - view

      Navy Blue Welder How about a concrete example. Let's say you have $2000 in your checking account and $8000 in your savings account. Both accounts are on budget. That means there is $10,000 Available to Budget (Ready to Assign). You allocate $1500 to rent, $2000 to new car, $500 to groceries, $3000 to emergency fund, $300 to groceries, $200 to eating out, and $2500 to house down payment. That totals $10,000 and all of your money is budgeted. You transfer $5000 from your savings account to your checking account so now there is $7000 in your checking account. But you added $0 to your budget in this process. And that's why you don't have the $5000 for the new car.

      Like 2
    • Navy Blue Welder If your TBB is zero, you have categorized it. Your savings dollars all have jobs. Since you spent the money on the car, you've now promised those dollars to that job, so if you didn't give them that job initially (have them in the new car category), then you need to figure out which dollars are doing double duty and move them to the new car category so they're only doing one job. 

      You prioritized spending that money on a new car. That means buying the new car with those dollars was more important to you than whatever other job they had. Now you have to figure out what that means in terms of your other categories - was buying a car more important than having those dollars as an emergency fund? Eating out? Whatever else you've been saving up for?

      Like
  • It looks like they are both Budget accounts. Does it make sense to make the Savings account a tracking account?

    Like
      • jenmas
      • jenmas
      • 3 mths ago
      • 3
      • Reported - view

      Navy Blue Welder No.

      Like 3
    • Navy Blue Welder No, not really. It makes more sense to understand that by putting those dollars on budget and having 0 TBB, you've given your savings dollars jobs, and have to treat it exactly as you would overspending from a checking account category.

      Like
    • Fuzzball Meows Okay, thank you. I have to really think this through. I don't know how to go back and reassign all those dollars I put into Savings. Should I have a category in my Budget called Savings that I should have been assigning all of that money to?

      Like
      • jenmas
      • jenmas
      • 3 mths ago
      • Reported - view

      Navy Blue Welder matching account balances to category balances is busy work that inevitably falls out of sync because it is an entirely manual process. I have 3 checking accounts and 3 savings account on budget. None of my category balances matches any of account balances because it doesn't matter for anything other than cash flow.

      Like
      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 3 mths ago
      • Reported - view
      Navy Blue Welder said:
      I don't know how to go back and reassign all those dollars I put into Savings.

       I gave you the link on how to move money around in your budget earlier in this thread. you don't have to go back to anywhere. you can move it in the current month.
       

      Navy Blue Welder said:
      Should I have a category in my Budget called Savings that I should have been assigning all of that money to?

       No. Savings is not a category. it's a location for the money. You save money in YNAB by assigning it to a category you plan to eventually use it for. The only difference between spending in saving is how long the money sits around. The account it's in doesn't tell you what the money is for.

      The purpose of a savings account is to get more interest while promising the bank you will not make frequent transactions with the money.

      Like
    • Navy Blue Welder No, you did the right thing by giving all of your money jobs, regardless of where it's sitting.

      The right thing to do now depends on whether you have actually bought that but car yet.

      If the money's spent, you need to recognize that you have $5000 less in your budget, and you have to rearrange your remaining funds to cover what you need. This is doe strictly on the Budget page, without considering accounts.

      If you haven't pulled the trigger yet, you need to decide whether you can. Again, on the Budget page, try to rearrange funds so that you have $5000 in New Car.  Decide what you can give up or tighten to make it work. If you can't do it, the new car will have to wait.

      Like
  • I've been socking money away in my savings account for years. Whenever I do, I use "Transfer" on YNAB so that money hasn't been given a job, it's just going into my YNAB Savings account. I read the link you sent on Moving Money and I understand that and I do that all the time.  Now I need to assign this Savings money the job of New Car but I can't because I can't categorize it. I know I'm being dense here and maybe there's nothing I can do about it now but, going forward, how can I avoid this in the future? I physically have the money but just don't understand how to reflect that on YNAB.

    Like
      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 3 mths ago
      • Reported - view

      Navy Blue Welder please read the article on moving money between categories that I linked above. it is handled via functionality on the budget screen, not with transactions.

      Here's the link again: https://docs.youneedabudget.com/article/126-moving-money

      You can use this functionality to move money from other categories into your new car category.

      Like
  • Navy Blue Welder said:
    Whenever I do, I use "Transfer" on YNAB so that money hasn't been given a job, it's just going into my YNAB Savings account.

    If your Available to Budget is at $0, you gave those dollars a job when they entered your checking account. Transferring the money to your savings account had absolutely no impact on the job you already gave the dollars. Dollars without jobs are the dollars in your Available to Budget regardless of which account they live in.

    Like
    • nolesrule
    • Stealing From the Future fix is an improvement but is incomplete....
    • nolesrule
    • 3 mths ago
    • Reported - view
    Navy Blue Welder said:
    Whenever I do, I use "Transfer" on YNAB so that money hasn't been given a job, it's just going into my YNAB Savings account.

    The money was given a job... when the money was deposited into your checking account with a transaction category of To Be Budgeted, and then you put the money added to TBB  into categories. One of those jobs at the time should have been New Car, but it seems that wasn't the case for you.

    Transferring the money from checking to savings just changes the account holding the money. The job you assigned it to when it it was originally deposited didn't change.

    Like
  • Ok, let's try a new analogy. 

    You have a two drawer file cabinet. The bottom drawer is your savings account; it has folders like "new car" or "emergency fund" or "wedding" or whatever else you're saving for.  The top drawer is your checking account. It has things like "rent" or "food" or "fun" or "phone" in it.

    When you transferred the money from your savings to your checking, you grabbed a few folders in the savings (bottom) drawer and moved them to the checking (top) drawer. You didn't move the papers (money) in the file folders around, just grabbed the files as they are and moved them.

    In order to pay for the car, though, you need to have enough papers in the folder labeled "new car". Which means you need to move it from other folders. Those folders can be in either the checking drawer or the savings drawer or both - where they are doesn't matter. But you need to move enough papers between folders (categories) to get the right balance.

    Like
  • Oh my gosh, thank you so much everyone. I will read and re-read all of this and go over the Moving Money link again. I really appreciate your help.

    Like
    • Navy Blue Welder You've gotten some excellent advice here! You might find this budget audit helpful, as well, for driving home the concept that those $5000 are accounted for in your total available amount in your budget. 

      If you're still feeling stuck after sifting through some of this info and you're up for it, go ahead and enable Support Access for your account. Once you’ve done that, let me know and we'll be happy to reach out via email, too! You've got this! 

      Like 1
  • I hope it's starting to make sense, Navy Blue Welder . I'm going to give it one more big picture try. Yes, your checking and savings accounts should be in your budget, not tracking accounts.

    All account funds in your budget are available for budgeting via To be Budgeted. For example, if you have Savings of $5000 and Checking balance of $3000, you will start with $5000 + $3000 = $8000 in TBB. Then, Rule 1 is to give all of those dollars a job. Some might be for groceries. Some might be to pay for your next car. But once they're distributed, they're distributed. The only way to change jobs is to transfer funds from one Category to another. 

    Transfers between Accounts has NO affect on your available funds to budget. If you started with $5000 in Savings and $3000 in Checking, like I said above, you have a total of $8000 in your budget. Now if you transfer $2000 from Savings to Checking, you end up with $3000 in Savings and $5000 in Checking BUT the same amount of budgeted funds, $3000 + $5000 = $8000.

    The accounts are only where your budget funds are housed. Your categories define the purpose of those funds. You change priorities by transferring funds between categories, NOT accounts. I hope this helps.

    Like 1
Like Follow
  • 3 mths agoLast active
  • 28Replies
  • 95Views
  • 7 Following