How to pay back my savings

I had my savings account set up as tracking and I had a category in my budget for my monthly car payment.  I used some funds in the savings account to pay the car off, but wanted to continue budgeting money for the car and "making payments" to the savings account until it was replenished.  This way, money leaves my budget as if I'm still making car payments as I transfer the funds to the tracking savings account.

Due to other categories I'm saving money towards, my on-budget checking account has gotten a little too high (thanks, YNAB!) and I wanted to transfer that money into the tracking savings account to earn some extra interest.  This was going to cause a problem, because it made it seem like the money was leaving my budget. After reading many posts on the subject, I decided to move my tracking savings account to on-budget. I created a new on-budget account and transferred all the funds from savings tracking to it and categorized it in a newly created category named "Savings".

This worked fine, but now when I try to make my monthly "car payment" it turns out to be just a transfer from on-budget checking to on-budget savings and the car category shows no activity (but the available balance increases each month because I'm still budgeting the amount I'm transferring). This seems wrong because the car category will show a pile of available money but the funds were actually transferred to the "Savings" category.

How do I correctly handle this situation?

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  • Divide up your savings category into more specific categories. Some of that money has the job of being for your car, and the money you transferred from other categories had a job too, or should be assigned one.

    Like 3
  • Hi, Red Screwdriver

    Bookmark and read this YNAB blog article (with screen shots) until it sinks in:

    The Relationship Between Your Budget and Your Accounts

    Basically, you are trying to overlay a different budget methodology on top of YNAB, that of budgeting by account. It's unnecessary because in YNAB you use categories to define the purpose of your money and only use accounts to earn more interest.  Now that you are building up some cash liquidity -- go you, by the way --  it has begun to confuse or cloud the process for you.

    Like 2
  • Your reimbursement is just like the other categories that were building up in your checking account: it only works if you know what you are saving for. Reimbursing a payment isn't a job for your money, as you won't spend that money again on that payment. So ask yourself: why is it important for you to reimburse your savings? What do you intend to do with that money once it is saved? Once you know the answer, create the categorie(s) needed to achieve this and budget to it/them the same amount you would have otherwise sent to the car loan company.

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  • Your tracking savings account should be part of your budget and given jobs. What is the point of saving money if it doesn't have a job?

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  • It sounds like you're doing this right, just having the normal first-time jitters about what it all means.

    Once you assign money to your Car Payment category (which you might want to rename "New Car"), that money is saved. Whether you also transfer money to your savings account or not is irrelevant. You've given the dollars the job of waiting patiently until you buy your next car (or make a major repair, or whatever your intention is). Under YNAB, the savings account isn't for holding money dedicated to certain categories; it's just a place to earn more interest than you would by keeping all your money in a checking account.

    Like 2
  • Thanks for the responses.  I think I have a much better understanding now.   The on-budget accounts simply document the location of your money.  You can transfer money from one account to another and it has no impact on your budget.  The budget tells what jobs you have for the money.  You can move money from one category to another and it has no impact on your account balances.  Today, I paid off all my credit cards, reconciled all my accounts and budgeted down to zero.   The $$ in my accounts matches to the penny the total available in my budget! That makes perfect sense.   

    Like 9
  • As many have already stated what you are trying to do is not how Ynab wants or expects you to move money. Therefore they don't have an easy way to make it happen, however there is a moderately simple work around.  It goes like this:

    I budget $10 each month for tools and after a year I buy a $200 saw. My tool category goes $80 negative and Ynab freaks out. So, I move $80 from Groceries to Tools and Ynab is happy. Then to make sure my money goes where it is supposed to I change the title of "Tools" to "Tools (reimburse Groceries $80)". I do everything as normal and in 8 months I move all $80 in 'Tools (....$80)' to Groceries and change the title back to "Tools". I could also repay Groceries each month and change the title to "... $70)" "...$60)" each month. Now I can start rebuilding my "Tools" budget.

    • Ivory Mixer I would just eat $80 fewer groceries, having decided that was possible in advance of buying the saw. Money should flow from lower priority categories to higher priority categories that need it. I don't track paybacks because it was a lower priority that took the hit.

      Like 4
    • dakinemaui 

    • dakinemaui I of course would need to eat $80 fewer in groceries or I would end up negative in Groceries.  I however then reward my grocery account by giving it an extra $10 each month to make up for my sacrifice.  I budget $200 a month in Grocery. At the end of two years I should have or have spent $4800 in Groceries and have or have spent $480 in tools. Your method changes those end results and more interestingly changes them by more or less depending on what month within the two years I buy my saw. Nonetheless, I was merely trying to help a fellow user find a solution to a situation he ran into.  I am not trying to impose this method on anybody else.

    • Ivory Mixer a) the fellow user probably made a decision a year ago, and b) I'm merely doing the same as you. All I said was that I wouldn't do it that way; and further to your comment, I wouldn't eat more groceries as a reward. I think we can both agree that folks should make their own choices based on what appeals to them -- we're just presenting options. Cheers. 🙂

      • Bruce
      • Software Engineer
      • Bruce
      • 2 wk ago
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      Ivory Mixer  I think that's the point.  Your priorities changed, so you "rolled with the punches."  Nowhere in that rule does it say you should repay after rolling with the punches.  (And I'm not saying you can't, or that your way is invalid, simply that it's a tweak you've added that works for you)

      But after moving the $80 from groceries, and you still spent the same amount you were anticipating for groceries, then If you're not happy with the $80 deficit that now exists in groceries, pull it from an even lower priority category.  At the beginning of the next month, you re-fill your categories, and move on.  

      Like 2
  • dakinemaui said:
    I would just eat $80 fewer groceries

    That's impossible. You can't eat a negative amount. It would be a cool way to lose weight if you could though...

    Like 3
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