How Do you Manage Food/Grocery Budget in YNAB via second account?
I am just getting to grips with YNAB and I am on day 2 of the trial.
I have manually inputted our main checking/current account into the app/website and inputted the current March balance and remaining bills.
I have allocated the remaining budget and can see that you set a goal, then allocate money to the budget, but when they bill is paid have it is an activity so you can see that it has been paid etc.
But, we also have a second checking/current account that we transfer £1200 on the 1st of each month that we use as what we call our 'everyday' spending. This is food, fuel, other bits a pieces. We split currently split it 4 x £300 and use a pen and paper system to record expenditure for each week and deducted off the £300 so my wife and I can both see how much is left for the week.
It works ok but not great, we are not really managing this money and we chuck away the paper transaction list at the end of each week. I need to split this out in to food, fuel etc, and then start to expand our budgeting so we allocate money for clothes, kids stuff etc.
What I am not sure about it how I would go about putting this account/process into YNAB in terms of adding a second current account but then adding the £1200 (4x300) in to my main budget?
I am not sure how I really budget in the app for it as I want to budget for the weeks and the record every transaction out of the account against our budgeted amount so I can see a) are we keeping with the £300, and where w are mostly commonly spending it, so that over the next few months we are building an accurate picture of what and where we are spending the money.
My initial thought was to have a line in the budget of £1200 and then just allocate the money to it when budgeting the month, then open a second budget just for the 'everyday' current account and track the transactions there. But, this doesn't allow me to see a single budget what we have left.
So, I am just trying to work out a better way of doing this so that I can budget the money, see the balance, and record the transactions.
We will probably still keep the pen and paper sheet in the kitchen so my wife can see it (for now whilst we learn to use YNAB), but I will mange it via the app.
Any help or suggestions very welcome.
You include all your spending and savings accounts as budget accounts. You put all your budget categories for spending and saving in the budget. You allocate the amount to each category you want to allocate. You then spend the money from whatever account you want to spend from because it doesn't matter to the budget. What matters is that your categories have the amount of money in them that you are going to spend.
Money is fungible. What that means is that money in any of the accounts can be used to spend on anything. Tying specific categories to specific accounts is a needless effort.
Right, what nolesrule said... If you want to keep the specific categories together, you can put them into a category group, towards the top of your budget, so you can see them quickly and easily. Or if you don't want them all in one group, (at least in the app) you can "pin" selected categories, so they always show up at the top of the budget. But when you're on the website, they won't show as pinned, so you'd probably be better off with the first suggestion.
Thank you for your comments.
So, if I have understood correctly, what I can do is:
1. Added our second checking/current account to YNAB and put the current value in 'to be budgeted' so it shows up in the main 'to be budgeted' fund.
2. Create a Category Group called Food and put 4 categories as Food Week 1, Week 2 etc.
3. Set a goal of £300 for each one of these categories which splits the £1200 we budget for the month into the 4 x £300 we are currently using.
4. Budget the remaining months money that I have for each of the weeks (week 3 is £152.98 and week 4 is £300), and then next month allocated the £300 each week to the budget catagories.
5. Then when we make a purchase from that checking/current account I apply it as a transaction to the account, but link it to the category Food Week 1 so it then nets off the value from the £300 budget leaving me seeing £300 minus the transaction value i.e. the remaining amount I have for food that week.
That way I can see I am budgeting £300 per week and also see if we under or over spent on that weeks food, so that we improve our food budgeting for future months.
Or am I massively over complicating it?
My goal for is (1) to understand better our weekly and month food expenditure so that we can better budget for it and (2) if there is money left over from a week, reallocate it to either another weeks food if needed, move it to an over spent category, or move it to savings.
Thank you for your advice.
Like what the others said - put the Everyday Spending account on budget and make categories for food, gas, etc.
At the beginning, you'll be tempted to try to keep that account equaling those category groups. However, I urge you to look towards category balances for spending guidance instead of the amount balance. When you can reliably do that, you will likely find the second account redundant.
Until that point of realization, you'll simply budget the amount that you transfer to those particular categories. The tricky thing is that you'll actually do that when you initially receive the money, not when you transfer it. The transfer has no category impact. It's like moving your wallet from your coat pocket to your pants pocket. Nothing changes in how you had planned to spend the money.