Confused how to handle goals in certain scenarios - "ghost underfunding"


Let's say that my income is $1500 monthly. I've just started YNAB and let's say I started with $5000 in my checking account.

I have given all of these dollars a job, and currently have $0 left to be assigned.


I've set up all my categories, some are more important than others, however they still all have goals. For example, I play tennis, and though my racket does not need replacing, one day it will, so I want to budget $200 for this. Since I already had money saved up and could fund all my other categories fully, I have also fully funded this tennis racket category. Similarly with a "poker night" category.

So in my budget I have:

Tennis Racket Replacement: $200

Poker Night: $50


I have given both of these categories a goal of $200 and $50 by the end of the month, respectively.

My issue is that when I view the month coming up in the future, since the current month has not ended and it has not yet "rolled over" the available balance from this month to the next month, and so it is showing my "underfunded" level of all my categories to be above my $1500 income. I understand what this means - if I were to spend all the available money in all my categories all at once, I wouldn't be able to replenish them all in the next month. 

1) is this a problem? I am unlikely to spend all my available money from all categories, and so although I couldn't fully fund my budget if that happened, am I right in thinking that this should be fine, or should I look to rectify this?

2) The way I have the goal set up feels slightly off. Say for my tennis racket, when I finally do buy a new one, let's say I spend $150 on it. I will have $50 remaining in the category, and when the next month rolls over, it will be underfunded by $150. The software will want me to save $150 in that same month, as that's what the goal is set to ($200 by end of month). However, I won't need another tennis racket for years, so is there a better way for me to set a goal that it will eventually reach $200 again, but perhaps 2 years after I spend that money. Or should I do this manually, i.e. remove the goal for the tennis racket completely until I buy a new one, then set a longer term goal at that point (to remove the issue of "ghost underfunding"). 

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  • Make sure you are using the correct target.

    Since you are saving a specific amount, you should probably use the Savings Balance Target which will prompt you to fund the $200 for the racket and then it will not prompt you to add more. Once you use it, then you would delete the target. One thing to you might want to look at is the Wish Farm concept to fund these types of items. You probably don't want a category with a single purchase in it eventually. The wish farm allows you to save for it and when you are ready to purchase, you move the budgeted money for the racket to a more general category (maybe sports equipment or sports or hobbies). Then, you can delete the Tennis Racket category or repurpose it for another desired purchase (hockey skates). It doesn't even have to be another sports item, it could be anything else. 

    Is the poker night a recurring one? If it happens every month, then use the Needed for Spending target. It will replenish every month. If you didn't spend the full $50, you will only have to fund the difference once the month end rolls over.

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