Handling my Paypal account in YNAB

I live in Japan and to make some extra money on the side of my regular job, I often do group orders or buy merchandise for people. These people pay me into my Paypal account and that then remains in there until I pay the company for the items (which can be a few months sometimes if they are preorders and the company takes payment on shipping).

In YNAB, I set up my Paypal as an account and then I have a budget category called "orders". To this category, I have added a budget which is the exact amount of money that should be in my Paypal to cover those orders (an amount which I take from the separate system I use to handle the orders).  

As I already handle the orders elsewhere, I don't want to add each payment I receive as a transaction in YNAB, especially since I can sometimes get up to 20 in one go. The reason I have the Paypal account on there is that whatever the difference is between my Paypal balance and the amount I need to cover orders is my money (from my own service fee etc.), and can be used in my budget elsewhere.

My easiest solution is to simply go into my Paypal account once a week to check the amount and manually change the amount in the account on YNAB. Then also change the budget for the orders in that category. This way, I don't have to add any transactions aside from when I transfer money from my Paypal to my bank account, or I'm covering a couple of subscriptions or anything else that I buy myself through Paypal (as that will be taken from other categories). This way the amount in my Paypal that is my money will automatically be in my budget.

Can anyone see any issues with me doing it this way? I'm pretty new to YNAB so I'm unsure if it will cause me any issues in the future.

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  • Hi, there! So glad you've joined us as a YNABer. Welcome! :)

    Whenever you get in the habit of matching an account with a specific category, not only are you signing yourself up for lots of administration, you're also likely to face confusion. That's because in YNAB accounts and categories are related, but there is nothing linking accounts to any particular category or group of categories in your budget.

    I wonder: Do you need to track orders in your budget, since you're tracking them elsewhere? If you don't need to, perhaps you can simply transfer your personal profit from PayPal to your checking account and log it as an inflow monthly?

    In general, the simplest way to deal with PayPal and other payment processors in YNAB is to leave the account out of your budget and instead record only:

    • The purchases that you make via Paypal that flow through your checking as regular transactions from your checking account, and
    • The payouts you get from PayPal that inflow to your checking.
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