Paying attention to my dollars just saved me ~$500

We have been using YNAB for about 4 weeks now.  In week 2, I discovered that a gas station had double-charged me to the tune of $40.  And then in week 3, we were hit with a $450 credit card annual fee.  $450!!!   (My husband reminds me that I agreed to the premiere card back when he was traveling internationally for work several times per month, so he could use the club rooms and earn lots of points. At that point we were maybe $90k in debt, so what the heck were we thinking?)  Instead of shrugging, or burying my head in the sand and turning off YNAB for a couple of months, I called the credit card company and asked if we could change the product and get a refund. And they said yes! We chose a $0 annual fee option, since a) we don't get much value from United points these days and b) once we apply a balance transfer to this card's balance, the only reason we're keeping this account open is because it holds the highest credit limit, and we want to get to a good utilization rate.

This has felt so, so good.  $490 just from paying attention and taking action.  We are deeply, deeply in debt (over $100k in consumer debt), and I tend to get into a cycle of fret, deny, put off opening scary mail (...apparently this last time it was for 10 months??). Automatic bill pay has been a lifesaver for me and for my husband, because it allows us to run on autopilot. (And then be surprised in $900 in charges and overdraft fees on our bank's line of credit, oy.). So, YNAB is a real change for us (well, me; husband's involvement is a work-in-progress). I am watching every transaction (I...I may be a little obsessed), which I just could not handle at any point in the past 30 years of my financial life. 

Thanks, YNAB!

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  • Great work! Maybe consider switching off auto bill pay — cruising on autopilot is fun, but as you pointed out, the awareness you gain of every transaction is extremely valuable. (Like, literal dollars valuable!)

     

    Andthe longer you use YNAB, the easier and less scary paying bills will be. So doing manual bill pay will just be a couple clicks, you're in charge of your money, and no one is auto deducting anything from your accounts. 

    Like 1
    • Scott This is interesting advice! I think it definitely depends on the individual whether or not using autopay is wise. I can see your perspective, but as someone personally dealing with both ADD and anxiety issues, autopay is essential to my personal financial management, since it ensures things will get paid and allows my brain to relax and not obsessively check to see when bills are posted. I still end up checking my budget and various accounts nearly daily regardless, but get considerable calm reminding myself that at least those few things are already taken care of, without *requiring* extra action on my part.

      So I'd definitely agree that it's worth considering what value autopay does or doesn't provide on a case-by-case basis, and decide from there! :)

      Like 1
      • Scott
      • scott
      • 3 yrs ago
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      Resistant Punch Roller Ah, that is a great point! How about keeping auto-pay on, but entering any auto-payments into YNAB in advance as scheduled payments? Then you'd have the benefit (and safety) of auto-pay, but still keep awareness in YNAB of those bills.

      Also, I think scheduled payments can be "recurring" (if they're the same amount each month, like subscription fees). Otherwise, you could enter in estimates and then when the real charge comes in (say for an electric bill) adjust the amount to match, then enter a new scheduled transaction (est. amount) for the next month's.

      Like 1
      • Beige Hail
      • Beige_Hail.1
      • 3 yrs ago
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      • Reported - view

      Scott and Resistant Punch Roller thanks for the interesting points of view. I  have a whole household full of ADD and anxiety (hello, comorbidity!), and I can see how autopay really helps.  But we ran into so much trouble with autopay when we didn't have enough in the bank to cover our expenses; we racked up thousands in overdraft charges, and I took us off autopay for the bills with variable charges.  We end up with late charges now and then, but ...well, fewer overdrafts.

      The first thing I did in YNAB was go through and add in all of my fixed bills as recurring payments, and determined a yearly average for our variable bills (electric, water) and set that as a monthly goal.  That way, I can rest assured that the software will help me track all those debts.  Once things have stabilized, I will be so thrilled to set up as much autopay as possible.  My thinking is that as long as I am tracking everything in YNAB, and confirming that our account has at least $200 in it (this is a category, Overdraft Buffer, which is probably overkill but will also help quell the anxiety until we have full confidence in the system). 

      I use the Chrome toolkit extension, specifically the function that creates a column showing goal amounts, type of goal (monthly, target, etc.), and whether there are upcoming charges (via scheduled transactions).  This lets me see at a glance which categories need filling, and by how much.

      Like 2
      • Beige Hail
      • Beige_Hail.1
      • 3 yrs ago
      • 1
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      Beige Hail Oh, come to think of it, I did actually take all the credit cards off of autopay, primarily because I want to pay as soon as the bill comes in and not a month later after more interest accrues, and I wanted to be really aware of the minimum payment (and how much of that is interest).  I think it's fine for cell phone, internet, etc., but yeah, tracking it all (and planning for it!) is key.

      Like 1
      • Scott
      • scott
      • 3 yrs ago
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      Beige Hail Wonderful, wow, thanks for sharing! It is definitely all about quelling anxiety, isn't it? And there are a lot of useful paths to get there. I'm going to check out the Chrome extension now. 

      Like 2
    • Scott said:
      Also, I think scheduled payments can be "recurring" (if they're the same amount each month, like subscription fees). Otherwise, you could enter in estimates and then when the real charge comes in (say for an electric bill) adjust the amount to match, then enter a new scheduled transaction (est. amount) for the next month's.

      I do *exactly* this, yes!! :) I have as many things as possible set up as recurring transactions in YNAB so I know they're coming up, and I've recently learned about the "Enter Now" option, which lets you enter the next instance with today's date (helpful for things I do have to pay manually, so I know when I've done it!), while keeping the upcoming recurring schedule intact. So helpful! :)

      Like 2
    • Beige Hail said:
      But we ran into so much trouble with autopay when we didn't have enough in the bank to cover our expenses; we racked up thousands in overdraft charges, and I took us off autopay for the bills with variable charges. We end up with late charges now and then, but ...well, fewer overdrafts.

      This is an EXCELLENT point, and though I'd temporarily forgotten about it, I actually did exactly this, too, when I first restarted YNAB a couple years ago and was juggling payment dates like crazy, and had to have full control over exact payment timing to minimize overdrafts. :(

      What a messy and frustrating cycle that is, I empathize completely! The good news is YNAB will definitely help you conquer that, bit by bit, bill by bill, so that you CAN get to a point where things can happily get back to set it & forget it autopay! :)

      Cheers to finding ways to conquer our anxiety, it's a beast!

      Like 1
      • Scott
      • scott
      • 3 yrs ago
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      Resistant Punch Roller  said:
      I've recently learned about the "Enter Now" option, which lets you enter the next instance with today's date (helpful for things I do have to pay manually, so I know when I've done it!), while keeping the upcoming recurring schedule intact.

      That sounds very helpful! That's another (minor) challenge I have with YNAB: that if I enter a scheduled/future transaction, it doesn't affect my budget until the date specified.  But sometimes I'd actually prefer that the budget reflect those funds are gone NOW, even if the transaction doesn't process for a few days or weeks. 

      I don't see anything in the docs on how that works: https://docs.youneedabudget.com/article/165-scheduled-transactions 

      If you say more on how to do that, I'd appreciate it!

      Like 1
    • Scott The "Enter Now" option (check the box for the transaction(s) and you'll see it under the Edit menu) allows the transaction to affect your budget now, but it also gives it today's date, which is sometimes an imperfect solution, but I'm finding it useful for certain transactions at least! :)

      Like 1
    • Scott For some transactions I'm finding I'll do "Enter Now" but then later edit the date for clarity, or sometimes I put the "real" date in the memo field - still playing around to figure out what works best for me! I agree that it was handy to be able to freely choose which future transactions affected the budget in old version of YNAB, so this is one of the ways I'm trying to adjust & figure out what works :)

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      • Beige Hail
      • Beige_Hail.1
      • 3 yrs ago
      • Reported - view

      Resistant Punch Roller Wait, what's the Enter Now option? ?

      The thing I am struggling with is that I can't see any way to distinguish what I put in manually vs. the payment that comes in later from the bank. When my manual estimate comes through as a transaction, and I don't remember that it was my manual entry (whether one-off or recurring), and then I think a bill actually got paid online.  But when I check my account, it hasn't.  I tried putting "manual" into the notes section of all my manual entries, but then when I match transactions I have to go in and manually delete that note. And, doing that has shown me that when I match transactions, sometimes YNAB chooses my guesstimate as the finalized transaction amount, and not the amount provided in the bank's transaction info.  Right now I am an obsessive sort of state, checking everything and spending hours each day with my budget. That will not last, and I worry that the imprecision of the manual entries will cause me to get hand-wavy about the budget. OTOH, perhaps after a few months I will have a more-accurate gauge of what bills are coming in when and what they ought to cost, and the times when I can't trust the matching will lessen. (I hate, hate, hate that they ask me to approve a match they've found without showing the two transactions side by side so that I can assess for myself.)

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      • Beige Hail
      • Beige_Hail.1
      • 3 yrs ago
      • Reported - view

      Resistant Punch Roller O.o  I will have to check this out.  I am torn, because I worry that if I use this option too much, then I'll move too far from "budget only what you have," and that when I need to roll with the punches, I won't have any freedom to move stuff around. But, for Immediate Obligations, this sounds like a good way to lock in those dollars as unavailable for WAMing.

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      • Beige Hail
      • Beige_Hail.1
      • 3 yrs ago
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      Scott This is a sample.  These are all monthly goals (M). Three have upcoming transactions (U). I have it set so that the goal amounts turn green once they're fully funded. (This will often just recapitulate the green that's in the Available account; where I find it useful is when I budgeted my goal amount, but then my expenditures have gone over my budgeted amount, making the Available column red. I don't know if this will be as helpful 6 months from now, but while I am trying to figure out how much we spend and whether we're underbudgeting. When I'm trying to decide whether stealing from a category will just put us in the hole again next month, it's handy to be able to see that I am in red because I made a choice to underfund a category one time vs. I am wrong about the funding levels needed vs. the funding level is fine but maybe there's a type of expenditure that needs true expenses category of its own, etc.)

      With this list in place, when I'm going through to budget, I can see at a glance what I have set aside, and whether there are any payments I should make sure to fund for the upcoming month.

      Like 1
      • Scott
      • scott
      • 3 yrs ago
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      Resistant Punch Roller That is awesome and so helpful, thank you!! I never would have found that. 😀

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      • Scott
      • scott
      • 3 yrs ago
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      Beige Hail That looks great! Thank you for the sneak peek. I recently started adding the day of the month that my bills are normally due into the category names themselves — e.g., "Electricity (15th)" as in "15th of the month." That's a tip I'd gleaned from another thread here. Then it helps to order your categories by due date, too.

      Of course, one day we will all be budgeting with last month's money, so the actual due date of any given bill is irrelevant. 🙂

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      • Beige Hail
      • Beige_Hail.1
      • 3 yrs ago
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      Scott I contemplated putting the due date on the category name, but worried that there would be too much visual chaos. (I have learned that visual simplicity is key for me; at the same time, I need my visuals to give me lots of info!.) I decided that all the dates were more information than I need -- since our money comes in bimonthly, the thing that matters for my planning (at least while we don't have a month's buffer, as you point out!) is which paycheck the bill is coming out of.  So, I have little clocks with 1st or 15th.  This was useful when I realized that I didn't really need a category for electric and a category for gas and category for internet -- what I really  needed to know was how much money to set aside and when. So, I am trying a new approach, where I have "utilities fixed, 1st" and "utilities variable, 1st," etc. , and I'm going to add emojis that indicate which bills are included.  Further down the line I may be able to just lump them all into "utilities 1st" (or even just Utilities, if we get a couple months' buffer!).

      Like 1
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