Goals for following years

I currently have a few goals which are due in June or July which I have set up in my budget with the due date of June 2020  or July 2020. I am now budgeting in to August and I need to set these goals into Jun /Jul 2021. If I do this the previous goal goes away. Is there a way to properly do this in YNAB before the payment is spent for the 2020 goal?

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  • Most experienced users prefer to budget no further than next month's area, and that is done toward the end of this month (when all of this month's income has been received).

    Money that would tide you over should you lose your job is simply stored in an Income Replacement category, rather than scattered in future months. In the event you lose your job, just move a month's worth of funding to TBB and budget as usual. Though, you might change budget entries in order to make funds last longer. More likely, however, you don't lose your job, but amounts and priorities just shift over time; flipping through multiple screens to edit values is needless busywork.

    Like 2
  • Since you said your business was closed it makes sense that you're trying to budget ahead. 

    However, there's a nasty bug in the software that I would hate for you to get bit by. Here's how it works:

    You budget in the future. 

    Something changes in the current month (let's say $50) and you cover it. 

    You know you need to eek out money from other categories, so you pull $20 here, $10 here, and $5 there. After looking at all of those categories and making decisions, you forgot how much you have left to pull. You look at TBB, and see it's $0. You sigh in relief. 

    Unbeknownst to you, your August TBB is still $15 short. For overbudgeting (to fix overspending that was trying to follow rule #3) in May!

    There are some ways to save yourself from this bug:

    1. Don't budget in the future - make a category for June necessities, July necessities, August necessities, etc. In less trying times, I'd recommend keeping them combined in one category, but having the months spelled out can possibly provide peace of mind.

    2. Only ever use the Move Money Tool.

    3. Use the Toolkit, which has a tiny red warning in the header to indicate future overbudgeting.

    Like 1
      • Wessel
      • wessel
      • 5 mths ago
      • Reported - view
      Move Light Sound Life said:
      Don't budget in the future

       That's just the best option. Little to be gained from dwelling on the past or trying to predict the future.

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  • But, per your actual question, you'll need to manually calculate the contributions needed for annually reoccurring goals with a due date more than a year out.

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  • Imagine you want to save $5,000 for a vacation you plan to take next June. YNAB's Rule 2 -- and ordinary common sense -- say that you should start saving for that expense now, setting aside some money each month.

    At first blush, YNAB seems to offer two ways you could accomplish this:

    1. You could directly budget money in June 2021's "Vacation" category (since that's when the expense will happen.)
       
    2. You could budget a little money in each month between now and June 2021, taking advantage of the fact that any unspent money in a category will carry over into the following month.

    Option #2 is unquestionably the correct approach -- it's how YNAB's designers intend the app to be used, and the Goals feature expects you to operate your budget that way.

    Speaking of Goals, it's important to remember that it's purely a convenience feature. Goals handle the (relatively simple) math of calculating how much money you should be setting aside each month. If the category is not on pace to reach the goal, you'll see a warning. There are some convenient quick-budgeting actions for assigning money to any underfunded goals. That's it. That's all Goals do.

    YNAB's marketing materials oversell Goals (IMO). They're not essential to the system -- they didn't exist in any of the prior versions of YNAB, and they're completely optional in the current version. I recommend mastering the fundamentals of YNAB -- the Four Rules -- before investing too much effort into setting up goals. YMMV.

    Like 1
      • bigGolfGuy
      • software architect & technologist
      • mhornak
      • 5 mths ago
      • 1
      • Reported - view

      bret - interesting take on Goals.  Once you are in the system, Goals are essential for making your budget categories hum from month to month.  Using Income Next Month method (Thanks dakinemaui ), it's a once a month budget session of squaring up transactions, evaluating Goals for categories, and then moving money from INM to TBB and hitting the Quick Budget Underfunded button. 

      I have goals on almost all categories, my monthly bills, future looking items like Vacations and New Cars (Not sure why somebody said you can't create a goal more than a year out, I can?!?). 

      Goals are the special sauce that enables the user to template their budgets and focus on more important things either in the budget or not.  Folks shouldn't be quick to dismiss them because they are not a mandatory part of making YNAB work...

      Like 1
      • dakinemaui
      • dakinemaui
      • 5 mths ago
      • Reported - view

      mhornak I think many new users don't initially understand the difference between a goal and the budget entry / category. There have been numerous cases where they are "stuck" because there's no goal for what they want to do, when all they had to do was budget their desired number directly.

      FWIW, Goals are not the only way to implement a template capability. I've described my process that doesn't use them elsewhere -- one advantage is that it doesn't berate me for following the methodology (Rule 3). While I wouldn't recommend it for new users, anyone who is following Classic Rule 4 and dislikes the nagging might consider it.

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  • Hmm, I don't budget into future months myself, but if you like the way you have it working now, then I would suggest creating a second, temporary goal. Say you're talking car insurance. Make your current Car Insurance category Car Insurance 2020 and keep it with the July 2020 goal you currently have. Make a second Car Insurance 2021 category with the goal of July 2021. If you don't care about reports and old categories cluttering up, then once you pay your 2020 bill, you can hide the category. If you like to keep your reports more accurate and not have a bunch of hidden categories, then pay your 2020 bill, move any money accumulated in the 2021 category into the 2020 category, rename it, and delete the old one. Since you won't have any activity assigned to the 2021 category, it will let you delete it. Or, actually, I guess you would rename it 2022 so it's ready once you want to start budgeting ahead for that year.

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  • I saw on Reddit they are beta testing some new goals which involve recurring goals other than monthly. Weekly and Yearly recurring goals were included.

    Like 1
  • Hi Eric Lofgren ! Our team is testing updates to goals... including one that may help for this scenario. 😉 The Release Notes is a good place to keep an eye on for future updates!

    With the current handling, goals are global. You have one per category. That means creating the one for next year in a future month, will override the existing goal. You've already funded the next few months, so you have the option to create the 2021 goal now (keep the reminder)—or wait.

    You don't need a goal to budget those dollars! Enter the amount by typing it in, or use the Budgeted Last Month Quick Budget option to fill the amount from the previous month. If you choose to wait until the current goal cycle is complete, you can add the 2021 goal then.

    Like 2
    • Nicole This method sounds like it makes the most sense. Many are saying to not budget in the future but that is one of the features I like best with this program. It gives me a better sense of security. I definately reworked the budget after losing my job and cut back on extras but thanks to YNAB it was easier and budgeting months ahead is very necessary for me so even though there may be money in the bank it is not available to spend as it is not in this month's budget.  When I receive my government EI (cerb) payments I can budget ahead and know money will be there when needed.

      .

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      • Superbone
      • YNAB convert since 2008
      • Superbone
      • 5 mths ago
      • 1
      • Reported - view

      Eric Lofgren You can do the same thing in a category. For simplicity, say your expenses are $3000 a month. If you have an Income Replacement or Income Deferral category that has $9000 in it, you know you have enough to last you 3 more months without any future income.

      Like 1
      • Wessel
      • wessel
      • 5 mths ago
      • Reported - view

      Nicole These changes look great, for example for groceries!

      If you’re looking at goals, maybe you could investigate common issues that pop up. Many new users seem confused by goals. They confuse it for the forecasting that a traditional budget requires. It makes it hard for them to do Rule 1 prioritization.

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      • dakinemaui
      • dakinemaui
      • 5 mths ago
      • 2
      • Reported - view

      Wessel Goals are meant to take the place of forecasting. It is a place to put your nominal values while maintaining accurate spending guidance. By using Rule 2, you hardly need to copy forward the same value and add it up -- a.k.a., forecast -- since you're obviously going to get to the total you originally specified.

      I don't disagree it is hard to do Rule 1 prioritization, but that is due to people wanting to spend more money than they have. I.e., the total of goals exceeds monthly income. YNAB guides them to deal with that and create a feasible plan, while a traditional budget would let the user think, "I'll just make up this shortage next month".

      Like 2
      • Wessel
      • wessel
      • 5 mths ago
      • Reported - view

      dakinemaui When you have a true expense, like car repairs, you are going to spend that anyway, you are just not aware of it. For these it's great to have a goal.

      People also seem to use goals for "want" type spending. So when new month rolls by they just Quick Budget - Underfunded and they're done.

      They're missing out on the most important part of YNAB: Giving All Your Dollars a Job.

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    • Wessel Our designers are doing a lot of research and iterating for the upcoming goal changes! If you have any specific scenarios that stick out, you can let our product team know here—and they'll pass it along. One of the tricky things for new folks is going from the previous mindset of "I make X per month, that's my budget" to budgeting the money they have on hand. In addition to Goals, we have a few things in the pipeline to help! 😉

      Like 1
      • dakinemaui
      • dakinemaui
      • 5 mths ago
      • Reported - view
      Wessel said:
      People also seem to use goals for "want" type spending.

      Of course they do. Goals merely make a pre-determined budget allocation for you. If that doesn't change, then why not save some effort and decrease the chance of fat-fingering the wrong amount? Want/Need is immaterial to how the number gets into the budget cell (it only impacts how big that number should be).

      Wessel said:
      They're missing out on the most important part of YNAB: Giving All Your Dollars a Job.

      I fail to see how that follows from using Goals. Using Goals is just one of many ways to enter a budget value. Indeed, if income is consistent, one can absolutely give all dollars a job via Goals. If income is slightly variable (e.g., interest income), most people will address the "leftovers after goals" manually, but that's probably a tiny fraction of monthly income. If income is greatly variable, I'd suggest using a Deferred Income category so the effective income is consistent (or at least in the realm of very slightly variable).

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      • dakinemaui
      • dakinemaui
      • 5 mths ago
      • Reported - view

      Wessel Looking back over your post again, are you criticizing Goals for overbudgeting? I would certainly agree that's a bad idea, but that's hardly the fault of using Goals. It's a failure to understand envelope budgeting. Whether someone creates goals whose total exceeds their income or they simply keep making budget entries until TBB is negative is the exact same error -- a user error.

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      • Wessel
      • wessel
      • 5 mths ago
      • Reported - view

      dakinemaui Yeah, overbudgeting is one aspect. But the real problem is that if all your money is tied up in goals, you are living in your past priorities.

      Rule 1 says to prioritize your spending when you get paid. Too many goals prevent you from doing that.

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      • dakinemaui
      • dakinemaui
      • 5 mths ago
      • 1
      • Reported - view

      Wessel Your conclusions may be true for you, but they are quite incorrect for me. I examine my nominal values throughout the month as new information arrives. They reflect my current priorities. (If not, then I would obviously change them.)

      I agree that having goals whose total exceeds your income is a bad idea. So is manually budgeting until TBB is negative. Same diff. The user is in charge of both.

      Like 1
  • mhornak said:
    Not sure why somebody said you can't create a goal more than a year out, I can?!?

     It's only the issue with two due dates. If I'm funding a $900 bill for July 2020 and I start now, the goal should prompt $450 for 2 months or $300 for 3 months (depending on if I'm contributing in May). 

    However, if I want the same category to have $900 in July 2021, I can't retain the first goal. The new one would override the old.

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