Loans, daily interest accrual, balances

Hi,

I've got ten different student loans set up in my YNAB account, linked across two different servicers, and my balances were off by a significant amount when I looked them up today ($150 for one of the servicers, about $110 for the other.) I've determined, at least for the first servicer (Great Lakes) that this is because they add interest accrual to each loan's balance every day. The connection doesn't seem to account for these balance adjustments;  if I look at the bubble number in the sidebar it's reflective of the balance as of my last payment, not as of today. 

Example: I made a payment on some of my loans yesterday. Great Lakes today reports the balance on my lowest account as one penny higher than YNAB reports it, because the account has accrued a penny in interest in the last 24 hours. This adjustment hasn't imported presumably because it isn't a line item on the balance sheet.

Of further note, when I first connected the accounts, the numbers it imported as starting balance were the balance *as of that day*, interest included. That makes sense, but because the payments on each loan are split between interest and balance (outflow and inflow respectively) the balances were off when I went to reconcile today. I fixed this by adjusting the starting balance for each account to be the $ amount as of the date of my last payment prior to linking and adding an interest line-items, but I was hoping I wouldn't have to add eight interest line-items each time my autopay goes through just to make sure that the balances are correct.

Is there a way for the connection to properly report a balance on an account like this? I've got an auto loan set up too and it's reporting interest correctly.

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  • Don't have any student loans so I'm just making a guess about your situation.

    I don't track either my mortgages or stock investments in YNAB.  I track those on a separate net worth  spread sheet.  The stocks mainly because the balance changes every day.  For my mortgages, the balance doesn't change that quickly so updating monthly works for me.  In YNAB, all I track is what I pay monthly for them.  For me, the bottom line is, what do I put toward these monthly?  What do I want to find in my monthly budgeting to put toward them?  Then, track that the balances are going the way I want them to, monthly, on a separate spread sheet.  If I kept them in YNAB, they would drown out all the  useful information YNAB provides me.  

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      • Violet Mare
      • Violet_Mare.4
      • 7 mths ago
      • 1
      • Reported - view

      MsTJ I've only just started using YNAB in the last month or so, with two primary considerations: lowering my debt, and being more mindful of my spending (with an eye towards both saving and moving some of that to help pay down the debt faster.) I've had student loan debt my entire adult life and I'd really like it gone, so having this big red negative number sitting there in the sidebar, especially one that decreases regularly (if slowly), is both a reminder of my goals and a visual indicator that I'm getting there, albeit slowly, month by month. I'm actually on track to have one of the loans fully paid off in the next couple of months.

      I'm fine with the balances on the loans updating monthly, but the core concern is that any payment I make is applied to each loan's balance (interest *and* principal), but the YNAB connection never updates accrued interest, so each month I have to add in the interest adjustment myself manually.

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  • Violet Mare said:
    I'm actually on track to have one of the loans fully paid off in the next couple of months.

    That is the bottom line, what is most important to you.

    In my budget, believe I would add a category group called "debt reduction" and decide on what I can put toward this goal monthly.  Then break it down to how much goes to which lender.  Then celebrate when I'm able to reach my goal.  

    It looks like you have already decided how you are going to reach your goals, and are making progress.   Congratulations!  That is fantastic!  

    Regarding updating with the corrected balance daily, it sounds too complicated and time consuming, for me.  If it works for you, that is all that counts.  

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  • I don't have my student loan accounts linked, but I do track the principal & interest manually. I can definitely relate to the tedium of manually adjust each separate account every month!

    I used to have a tracking account for each loan's principal, & one for total interest, that I had a split transaction for my regular monthly payment on. I then manually adjusted the balance on each once a month. I got tired of manually adjusting so many accounts, so I recently switched to having just one tracking account for the principal & one for the interest. I can see that the one I am paying more on is going down when I log in to my student loan portal, & the balance in YNAB goes down the same either way.

    I wish I had a solution, or even an explanation for you!

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  • So, good luck to you with your payback. I also have Great Lakes as a servicer and have spoken with them several times over the years, each time learning a new application of their terms and conditions. Fun times. This is how I deal with it in YNAB and Excel combo.

    YNAB: loans are combined into one tracking account. Each month, an automatic transaction moves money from my checking to loan.  Each month, I verify the amount of interest that has been paid and make an outflow on the tracking account to the tune of "interest to get balance on payment date 3/22/19." That way, each month reflects a month's growth and repayment. I do not track changes daily.

    In Excel, I created a sheet with a row for each loan serviced by them with columns for account numbers, balances on payment/due dates, interest accrued each month, percentage of principal allocated to each loan, any extra payments, and new monthly balances that start the calculations over again. From that math, I can project how they will allocate my regular payment to each loan (my margin if error is within 3 cents, not bad, since they won't tell me their rounding rules). I have also mapped out my avalanche to pay it off.

    Word to the wise:

    If you use automatic withdrawals (good way to reduce interest...), Great Lakes automatically changes your due date to be the date of your auto draft. This affects the implementation of a few choice rules.

    #1 All extra payments must first take care of any accrued interest.

    #2 Any payment made after the previous due date must act as the normal monthly payment for the next month, meaning it's allocated among the loans without your control.

    This means that to maximize your extra paydown power, you should only make extra payments at the same time you make normal payments: there is no interest, and you get to allocate all the extra to either the highest interest loan or lowest balance loan, depending on whether you're using an avalanche or snowball.

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    • Also, I don't have any of my accounts linked. I don't know if that changes anything.

      Fun story: I did the math, and because I missed last month's due date for the extra payment, paying the same extra money the following business day would cost me $845 more over the life of paying them down (one year, I hope!) than waiting until the next due date. 

      The lady on the phone kept assuring me that making an earlier payment would mean accruing interest on less principal, which is true. However, since the following day started a new cycle, about 1/3 of my hefty extra payment would get allocated to the loans I am not trying to focus on yet, 2/3 of the extra would go to the loan I want, and then I would accrue interest for nearly a month. Then, about 1/4 of my "regular payment" would go to interest, and the rest to the loan of my choice.  

      I calculated this scenario side by side with a scenario with a super extra payment this month. I could not believe how much of a difference there was from simple timing, and how difficult they make it to maximize extra payments.

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    • Move Light Sound Life Yeah, in general if I have a little extra I can toss at a loan, I allocate the excess specifically as part of my monthly payment and play with the sliders so it goes exactly where I want it to. Right now I'm paying ~40 above my minimum (which is all I can realistically afford; I have several major upcoming expenses which YNAB is helping me save for) but I've made sure that it goes towards the one loan with the low balance. Helps that said loan also is one of the higher interest, unsubsidized ones.

      Again, I'm not really concerned about the fact that interest accrues daily. It might be nice to see as part of the bank connection, mostly I'd like to make sure that when a payment on the account registers, and some of that money goes towards interest, that's reflected automatically on my balance sheet. Since the loans' balances creep upwards daily but since that creep isn't reflected anywhere, their balance in YNAB is never up-to-date when the payment goes through. The balance mismatch is the core of my problem.

      My other two loans are with Navient but since their payment is on a two-week offset to the Great Lakes loans, I'm going to get to go through this process again on the 22nd or with an entirely different web interface. At least Great Lakes makes it easy to see the before-and-after balance...

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    • Violet Mare If you wanted, you could change your Great Lakes due date (payment date) to match the Navient one.  I suppose I don't get bothered by these because I manually input all of my transactions, so I'm used to that.  Also, I have the loans as a single compiled tracking account, so I only have a little bit of work to adjust for interest each month.  I can imagine that 10 loans a month, spread out over the month, would get annoying.  I suppose that you had to put them as separate accounts in order to link them, though... If not, I'd look into using the total balance for each servicer.  

      As it is, I think tracking each loan's movement individually is too much work for me to be happy with.  I'd rather have Excel do all the nitty gritty details for me.  Then I can update totals in YNAB each month to get a relevant Net Worth report. 

      However, if you want to keep it the way you've got it, here's a workflow that might minimize some clicks:

      - pull up Great Lakes a day or two after the payment is supposed to go through (it never shows as cleared on the day of for me)

      - compare the balance of each loan to its statement/interest charged overview page (don't remember what it's called, but I think the info is in about 3 places). 

      - click "Reconcile" on YNAB

      - put in new amount

      - YNAB puts in a reconciliation adjustment

      - edit that transaction to say "interest to get balance on 3/19"

       

      Maybe that will save you some time if you go that route, but I don't have that kind of patience to do that for 10 separate loans. :)

      Doing that will also fix the fact that you started your loan balance in the middle of a payment cycle.

      Like 1
  • Move Light Sound Life That's how I handle my student loans. I just set it up as a tracking account and I go in and manually reconcile the difference once my payment has posted to the account. 

    That way I can see that big red number going down each month. 

    The other, more granular tracking I think would be easier in an Excel sheet.

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