Conversation on how it works: Entering Sept. paychecks and over budget by X.
As my wife and I are reviewing how August went and looking to budget Sept. when we plan the future bills and expenses in the Registry; It shows we are 700 over budget.
I am confused as how this calculates. There is more planned coming in during Sept than i spend and there is a base of 8K in the checking account.
Some of the 8k is my sinking fund where we budget months ahead for known big expenses, and some of that is staying a month ahead in the checking account.
I just need to know how the tool calculates. As my check registry shows I will be way above on Sept 30th.
Any discussion is welcomed. Thanks.
You should only budget money you have right now. This makes the money shown as Available in categories actually be available to spend now. When you get more money, make a plan for that (budget it) at that time.
YNAB is an allocation budget. You are treating it like a forecasting budget. I think you will be more effective using the tool as designed.
I believe you point out how I was using the previous tool and relying on the planning (forward looking) to ensure we are with in the plan. I will go read the tools intent again to see if I can align to the use.
I do like to review the future and the impacts our decisions today have on the future so I we can adjust now or later. I may just have to do this outside of the tool. Too bad my bank stopped letting me get the .csv file so it would allow the use of Ynab 4 still.
I really liked the way we were able to "break" Ynab 4 and plan out 3 months ahead for easy information to make decisions on i guess.
Thank you for taking your time to explain.
Budgeting Practices said:
I do like to review the future and the impacts our decisions today have on the future
Through Rule 2 (normalizing non-monthly expenses), all my future expenses "show up" in the current month. If I make a choice to reallocate today, I know at a glance the impact on the future without looking beyond the current month.
This mindset was a game changer that let me leave forecasting budgets behind. Instead of copying numbers forward to see if they add up to the required amount, it's far more efficient to work backwards. The contribution that will result in exactly the needed amount is the remaining amount needed divided by the months to go. The new YNAB will even suggest this amount if you tell it the date and amount needed.
Usaa turned all that off and Sadly no. I think you helped me get back to where I needed to be. Use the tool as intended and fight to get to a few months ahead manage at zero dollar and have sinking funds (even an overflow fund) in the tool to move money form to account for those ebb & flows that occur. Then I will be making a decision to move money with purpose rather than Spending future earnings. The red over budget showed up when I decided to send some funds from checking to the savings for our emergency funds.
Otherwise i would have never seen that i was stealing from the future to make Sept happen.
I am completely overwhelmed by this point - I have plenty of money saved and properly linked in my accounts. I pay off my CC every month - and yet I show a gigantic TO BE BUDGETED negative number. I also see weird things happening, like a negative number in my budget with a huge number in the available. I feel like I am going round in circles on this basic step. Help?
I completely disregard the TBB number at the top of the screen. It doesn't tell me anything I don't already know. I plan for the entire month well in advance of the 1st, accounting for current cash at bank + scheduled/forecasted income. I'm sure as hell not going to budget twice a month. I budget savings and spend, so my TBB is always zero or negative. I don't need a piece of software to tell me I'm behind for the first 14 days of the month before paycheck 1 of 2 clears, I already know that. I don't care.
I think To Be Budgeted exhausts unallocated funds first then goes negative. The tool disregards scheduled/forecasted transactions in its TBB figure calculation, which is why I ignore it. If you already know that your scheduled inflow transactions (which you should enter in YNAB anyway for tracking purposes only) are greater than or equal to your budget, just don't worry about it and make sure it balances at the end of the month (e.g. income >= expenses + target savings is your ultimate goal).
The only time you should be alarmed about the alerts that the tool gives you is when you see red flags that tell you something you don't already know.
As a newly returned YNABer working on stabilising my finances and paying down debt (I’ve used before), I can’t recommend strongly enough actually using the YNAB method and making sure TBB is a key focus.
Yes you may already know what the problems are, but TBB, funding non-monthly expenses (true expenses and that killer question ‘what does this money need to do before I’m paid again’ will help you solve the problems. For me the tools are helping me to chip away at the paycheck to oaycheck cycle and the crisis that each non-monthly bill used to cause,
There is a reason why YNABers become zealots - the method is helping me to make changes they’ve previously thought as impossible. It also shows progress and provides minor wins which help me stay the path when I get discouraged.
When I used YNAB five or six years ago I had a high income and was expecting a major job change. The method helped me to get control of overspending, a credit card float and build a buffer which helped get a loan for and fund an investment property. (Life, death, job loss, inheritances and various other things got me off track but that’s another story )
Now with much lower and variable income, TBB, funding non monthly expenses and that killer question are helping me build a pathway forward and make choices about my limited resources and high debt obligations .