Brand new and way off
I just created my first budget in YNAB a few days before September was over. I'm a little lost now because I may be trying to do too many things at once while starting out. Here's a breakdown of what I remembered I did...
1. Created September budget somewhere around 9/26 or so.
2. I get paid once a month, and that happens usually on the 28th of each month, but in September that happened (oddly) on 9/26. This end of the month payment is actually what I use for the entire following month. So the 9/26 paycheck is all for October budgeting.
3. I created the Sep budget retroactively. I have a Google Doc that I normally do my budget in and had all the numbers from last month's budget (Sep). So, I just put in the amounts I would need to pay/budget that my Google Doc showed based on what was to be paid in September. I did all of that in the "Budgeted" column.
4. Next, my transactions started flowing in from my accounts, but I wanted to see how September "played out" by importing all my transactions from those accounts retroactively. So, I grabbed the import files for each account in the time frame of 8/28 (pay day) through the present transactions.
5. Then I applied the transactions to the right categories in my September budget.
All of this seemed to be the right thing to do, but now I'm not sure what to do next. I've been paid on 9/26, and I've got money that I'm spending for October, but it seems like it wants to be "categorized" in the September budget? I've got a big green number at the top of the September budget saying it needs "to be budgeted" and a big red number on the new October budget saying it needs "to be budgeted". I've got transactions that I've come in that I'm not sure if they will correctly fall in the right month's budget. (I haven't touched the October budget yet, by the way. As in, no numbers entered.)
Basically, how does it know that my just paid electricity bill (paid on 9/28) is really for the October budget, because that is AFTER my normal pay day for the month of October?
Should I not have imported all those old transactions for September?
Also, why do things like my Mortgage say they are a huge negative number in the left side bar? Is that because it sees that as debt that needs to be paid off and there's nothing I really need to do about that?
Thanks for any help you can offer!
It will probably be faster for you to fresh start and look at the getting started materials. But in short:
1. YNAB is a forward looking budget. Don’t import old transactions. Start with your balances today.
2. Budget for spending you need to do today and after today.
YNAB is an envelope budget, not a tracking spreadsheet. What you are doing is not assessing your spending, you are actually taking your money on hand and divvying it up according to what you need to do in the future. So you can’t budget for past spending because the money is already gone. You’d be taking cash you have today and saying “I’m going to set this cash aside for spending I already did” which...why would you do that? You wouldn’t. So don’t do that.
Take the money you have today, and budget it to categories based on the money you need to spend between today and your next paycheck. And if you can manage to budget all the way to Nov 1 with your 28 paycheck, that will put you in even better stead.
I agree with WordTenor I think you are mixing up philosophies and that's causing some confusion.
A fresh start might be the simplest way to sort yourself out just so that you don't get things too confused.
If you take a fresh start, enter the balances of all of your accounts - so ALL of the money that you have now, then you can take it from the To Be Budgeted (TBB for short) and apply it to the categories for the bills that you will be paying from today forward. If you already paid the power bill and the money has already cleared your account, don't worry about it, and just budget for next month's bill (which comes at the end of October).
If you want some additional help, feel free to message me, I'm happy to chat about it directly. I know how much it can help to have specific support sometimes.
I'm an independent contractor and my income is sporadic. I get paid sometimes monthly or quarterly.
I setup my budget. I have my monthly expenses and periodic payments. Periodic payments are usually one time bills such as house insurance, property taxes, annual membership fees. I also have savings goals for future things I want (I pay cash only ~ no debt here).
Money comes in. I budget for future months. Money that comes in October is budgeted for November, December, January. I usually have about three months budgeted in advance. This works perfectly for me because I never have to worry about day-to-day expenses and never stress about when that paycheck is coming in.
I hope this helps.
I get paid on the last working day of each month, and that money is intended for use in the following month, so I think our paycheck cycles are similar. I also started YNAB towards the end of September and here's what I did. I entered a starting balance for each of my accounts (checking, savings, and credit card) on September 28th. Since I had already paid all of my September bills, I just budgeted what was left in my checking account to a "Cushion" category, to cover any expenses that came up before the end of the month and I budgeted what was in my savings account to an "Emergency Fund" category. I got paid on September 30th. Even though that transaction technically occurred in September, that money is intended for October expenses/budget. Because I didn't want that money to show up as TBB in the September budget, I created a scheduled transaction for that income on October 1st. When October 1st came, that income showed up under the TBB for October, and I budgeted all that income to my various categories. I now have a recurring income transaction on the 1st of every month, even though I technically get paid 1-3 days before then.
Turquoise Pony said:
how does it know that my just paid electricity bill (paid on 9/28) is really for the October budget
Lots of good advice above, but I don't see anyone addressing this. (My apologies if I've missed it).
Your outflow on 9/28 is NOT really for the October budget. That is a September expense because you pay in Sept. If you want to budget all of your Sept. income into October's area, you're going to have to budget for that Sept. expense from money received prior to Sept.
In other words, you have to get ahead to be able to push all your income into next month's area.
(The budgeting process is simplified when you can push income into next month, so it's a good idea to get to that point. One way to get there fast is to apply startup capital, assuming it covers those month-end outflows. )