Goals & WAM-ing
YNABer for a little over a year. I just started using goals in earnest. I thought I understood them, but am struggling with this concept.
I have the majority of my categories setup as Monthly Contribution amounts, because I want to add to those categories and keep building up the value if I don't spend it. However, I want if I actually budgeted the amount to consider the goal as met, even if I move money out of the category to WAM because I'm rolling with the punches. Is there a way to do this?
Detailed example:
Dining Out Monthly Contribution Goal: $169.13
I overspent on groceries this month (hello COVID-19) by $63.31, but instead of using my next paycheck to cover that overspending (like I usually do), I want to use the money in my dining out category to cover it. So I move the money. But now, it says I've underfunded my goal, even though I actually did EXACTLY what I wanted to.
Is my best bet to actually remove my goals once I budget them out each month? I am planning on reassessing the majority of my goals every month, so this might not be terrible, but want to make sure I'm not missing something.
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Goals are just aspirational. You rolled with the punches, which is exactly right. If it bothers you, modify it this month and put a note in the goal to restore it next month.
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I actually think you don’t need to change anything at all. Your goal was to fund X amount to your Dining Out category a month, unfortunately you weren’t able to because some of the money had to be used for Groceries instead. The goal is correctly highlighting the fact that in the end you weren’t able to fund your Dining Out category properly.
Did you meet your Dining Out funding aspirations this month? Well no, you didn’t.
Does it suck? Sure.
Is it a problem? For you, you mention you made the conscious choice to use that money somewhere where the need was greater and you are comfortable with that decision, so it’s not a problem.
Do you need to do anything else? No, YNAB is just highlighting the goal wasn’t achieved. That’s fine, you don’t need to fix it up - let it go / ignore the warning (it is only a warning after all) this month and next month start anew.
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Blue Wildcat Thanks for this response. I think the problem I'm having is that I had additional funds in addition to the goal amount already in my dining out category from last year. So why can't it see the WAM-ing from the balance? You're right, it's more in my head than a problem with the software though.
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Heatskitchen No problem, glad it was helpful!
Sorry in advance for the long post but just wanted to highlight why it’s really not so bad!
You are right, it does ignore the balance you’ve accumulated in past months but that’s due to the way you have the goal currently set up (fund $X ever month regardless of how much you already have).
If you really wanted to take your past savings into account, you could always change the goal to have a target balance of $200 at the end of every month which would definitely take your past savings into the equation however I’m not sure that’s what you really want. At some point you may very well want to use all of your saved up money on a lavish night out (and why not? you’ve put all the money aside for it) and not have to fund the full $200 again. It sounds like instead your goal is actually to funnel aside an extra $50/month (as an example). If so then your goal is setup correctly.
Ultimately it comes to what you want your goal to be for this category :)
Personally, I finish every month with a couple of categories that almost always have a ‘warning’ that my funding goal hasn’t been achieved and that’s fine. As a couple of examples:
1. My “goal” is to save an extra $1000 every month, on top of everything else to repay my mortgage early, some months I get there and some months I don’t. Fortunately repaying my mortgage early is a ‘nice to have’, not something essential so even if I don’t get there it’s a little disappointing when YNAB warns me I haven’t achieved my goal but I can live with it.
2. I have a goal to put aside $50 every month for my partner’s beauty products. At some point we had $500 in the category (and she still looked amazing) because she was spending less than this. We made the decision that a portion of that money could be better used elsewhere and transferred it out. We obviously didn’t achieve our goal of savings $50 in that month (in fact we had taken money out). YNAB warned us the goal wasn’t achieved but that’s fine, we know and it’s exactly what we wanted & chose to do in that month.
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I think Blue Wildcat is right - I just need to get over needing to see green everywhere :)
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Just edit the goal in NEXT months area (same amount). It will cancel the Underfunded warning. (Don't do this with a Spend By Date goal, though.)
