So, I am running YNAB with roughly 60 Categories, and felt at the beginning that I was quite clever with the groups and the categories.... but now I have to say, I am wondering about a better way. How do you group your categories? Is approx 60 is the norm, or the exception?
Looking for better ways! :)
I've only started but I find it a good idea to have a single category for spending I am wanting to change/track and put things together that are non-negotiable. For instance subscriptions to film/TV services that I have had for years which I am not interested in changing are kept together as I know that so many £'s a month goes towards these. On the other hand I have my clothing budget split into work clothing, casual clothing and shoes to monitor how much I'm spending.
Cadet Blue Nomad said:
This is similar to having stocks as part of your budget. It's not really money until you sell the stocks and every month you have to deal with the ups/downs of the Market.
In addition to the replies why you have tracking accounts for tracking the major assets, I would add that I actually have investment accounts as tracking accounts as well, retirement accounts and college savings accounts. With 1 in college and another starting in the fall I make transfers from those college accounts to my bank accounts and in the not too distant future will do the same for the retirement accounts.
I am not trying to track the daily market variations, just monthly. I simply do a reconciliation on the last day of the month for the month end balance and have YNAB enter a balance adjustment for the difference. That way my net worth graph shoes a more accurate picture of my financial health. And those accounts represent the biggest part of my net worth.
I think the best advice I have heard was to start with the fewest number of categories possible then expand as needed as you gain experience with your spending habits, etc. It is easier to expand the number of categories going forward than it is to reduce the number of categories going backwards. I have 48 categories broken into 7 category groups. My groups are Savings (sinking funds for things like vacation, new furniture, emergency funds), Fixed expenses, which is anything I get a monthly recurring bill for, Living expenses for things like gas, groceries, dog food, etc., Unexpected expenses for things that happen but we didn't budget for or are trying to curtail (fast food, coffee, etc.), Long term expenses for things we need to buy but not every week, like home heating oil, the water bill, clothes, cleaning supplies, Giving for charity and gifts, and finally credit cards.
Unlike Superbone I'm not comfortable having stocks in my budget
Having tracking accounts for investments does not make them "in your budget" using the YNAB classic definition where tracking accounts were actually called off-budget accounts (https://classic.youneedabudget.com/support/article/account-types).
It is no different than having tracking accounts for loans. That is money you can't spend from directly. If you put money into it or take more out that is a transfer that has to have a category. The balance changes on its own because of interest.
The only real difference is that the balance fluctuates more often than monthly and not as predictably. But since it is really there for net worth and that is graphed by months you really only need to record the monthly gain or loss.
I know the difference between budget accounts and tracking accounts. I've been at YNAB for several years. Superbone literally has...
I know you have been around for years. I have been around for years too, I just don't live here every day but come by for occasional visits. But I wasn't responding to what Superbone said, but what you said:
I'm not comfortable having stocks in my budget. Instead, I have money in certain categories that I send out of the budget for investing
I read that as you are not comfortable with having even tracking accounts for stocks. I read that as when you invest it is recorded like it is spent instead of a transfer to a tracking account.