Savings Account

I am confused...literally...confused. why would I budget my savings account. it literally is a savings account. I put money into it not take money out. YNAB makes the savings account money part of the budget to spend. this literally makes no sense. is there a way to turn off that so it is not in the budget. Savings should default to not being spent and be the other way around where you are budgeting to put money into the savings account and not the other way around. 

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  • What are you saving for?

    Make categories for those things and budget your savings money to them. Then, don't spend it. 

    Your budget is not just for spending. It's the plan for all your money.  Some you'll spend on bills, some you'll spend on contingency expenses (save that money until it's needed). Some, you hope to never spend. 

    Some common savings categories include the following:

    Income Replacement, Medical, home maintenance, car maintenance, veterinary, vacation, technology replacement, etc, etc. 

    Like 2
  • Who said anything about spending? Budgeting doesn't mean spending. Sometimes you spend budgeted funds but more often than not, you save them.

    Like 7
    • Superbone and others saying you don't have to spend it, or just make a category for spending it.  I don't think you all have ever used this app  with a linked account before. This program expect a "zero sum" account or zero remaining "to be budgeted" each month or it says you are wrongly budgeting.

      Budgeted means spending it to this app, which is exactly my point. if you say I "budget" 500 dollar for "savings/vacation", whatever it may be, and the linked account does not see a "negative" charge meaning spending of 500 dollars from the linked checking account, then it will say you have a positive amount left over and did not budget correctly.  So...for example, if I say I budgeted 500 dollars a month to save for vacation or savings or whatever it is,  and there is no -500 from checking it says I didn't budget correctly, and if I put that -500 from checking to "budget" correctly and put it into the savings accounts that is also linked,  it then says the savings account was +500 for the month. It then says I have a surplus from the previous month which needs to be included in this months budget adding 500 dollars more to my paychecks and now i have to budget for that extra 500 that was in the savings account as a surplus. 

      i guess you have to put a savings account as an asset and it can never be a savings account otherwise this app expects to see a net zero every month for any kind of "budget" account which I think is just kind of dumb you cannot turn off the "to be" budgeted. 

      Like 1
      • nolesrule
      • Been waiting 5 years for the Stealing From the Future fix...
      • nolesrule
      • 2 mths ago
      • 3
      • Reported - view

      Violet Cello The others have been using YNAB for a very long time. You might want to re-read what they've written and try to absorb it..

      Money added to a category stays in the category until you spend it or repurpose it by moving it to another category. the account money is in does not matter.

      When you budget $500 for a vacation, that means you've reserved $500 for future vacation spending. You can spend it today or 5 years from now. Next month budget another $500 and you'll have $1000 reserved. Whether you decide to have that money in checking or savings is a cash flow decision based on the amount of money you need in the checking account. Transfering money between 2 budget accounts does not need a category. It sounds like you are not using transfers but separate outflows and inflows when you move money.

      https://docs.youneedabudget.com/article/168-making-a-transfer

      Also read the other links others have posted.

      Like 3
      • RIP_MSMoney
      • FinTech Programmer
      • rip_ms_money
      • 2 mths ago
      • 2
      • Reported - view

      Violet Cello i am not sure i am following but it sounds like certain concepts are getting mixed up.

      to be clear, i use ynab, linked accounts, zero based budgetting, and my tbb is always 0.

      Concept 1: differentiate account from the money. Ynab doesnt care where u keep your money. It cares that you have money. Leave account aspect aside for now.

      Concept 2: give every dollar a category/job. This category might be a holding cell, sinking fund, spending placeholder, etc. Google "ynab wish farm" for example. Your category could even be "savings account, no touchy" but that doesnt seem granular enough. What is it for?

      Concept 3: spend only money from categories with funds in it. If a category goes neg, then you need to reallocate from another category.

      Concept 4: tbb should be 0. That means every dollar has a job. Even if that job/cateogry is "tbd". If you leave money in tbb and a category goes neg, it will pull from tbb.

      There are many more "concepts" in my mind but i am just not sure i am following the problems/confusion. 

      I have 3 accounts (2 savings, and 1 checking) and all funds are categorized. Some of those are safety nets (like emergency fund, income replacement, etc). Where those "physical" dollars exist is not the right perspective. If you are concerned of an account going neg then you can group your categories BY account instead. 

      Hope that helps

      Like 2
      • RIP_MSMoney
      • FinTech Programmer
      • rip_ms_money
      • 2 mths ago
      • 1
      • Reported - view

       Another thing is to make sure your savings/checking are all budgeted accounts. (Investments can be just tracking). When this is the case, then give every dollar a job/category. When that is the case, moving money around (aka transfers) is then no longer a category-tagging action. That is because the money is already accounted for.. you are simply changing which account is holding those funds.

      If you dont have all of your saving/checking accounts listed as budgeted, then your right hand wont know what your left hand is doing. YNAB wont know that the money is staying with you as opposed to leaving your budget for good. As such, it will ask you to tag the transaction (aka transfer) with a category because it doesn't know the funds are staying within your budget.

      Like 1
      • Herman
      • herman
      • 2 mths ago
      • 4
      • Reported - view

      Violet Cello As you said in your original post.  You are confused, literally confused.  You don't understand how ynab works, Just about everything you say in this post is incorrect. 

      Like 4
  • A savings account is merely a place to store money. Your budget is merely your plan for your money. I have a budget line item called Loss of Income that at its current level should last me 6-8 months. My hope/plan/desire is to never spend from that category but I should still budget for it right?

    Why are you putting money in your savings account? So that you can have enough money on hand to fix your roof if a tree crashes down on it? Then create a Home Repair category and allocate funds to it. Or maybe it's so you can pay for your kids orthodontia in a few years - in that case create a category called Braces.

    Also in YNAB the location and purpose of money are 2 different things so don't get yourself frazzled trying to match category balances to account balances (Read This). It's just extra work. I make sure that I have $X in my checking account on the first of every month and then anything else goes into my savings account. I can't tell you that the money in my Christmas category is in my savings account and that the money for my Entertainment is in my checking account because that's not how I break up my funds.

    Like 5
  • Money is saved until it's spent. Storing it in a higher rate account doesn't make it any more "saved". Put it in a piggy bank if you like, and it's still saved. The point is to plan so you don't get caught short or over estimate what you can buy/do with that amount (VERY common).

    As others have said, WHEN you actually spend it is up to you.

    Like 6
  • It took me a while to grasp the idea that location of money had nothing to do with the budget.  It was actually a freeing experience when that light finally turned on.  As others have said you should budget all money from your on budget accounts, you can actually set up a category for savings and budget your savings amount to that category.  The budget simply brings all money into accountability.  Do not get caught up in trying to maintain the your savings category amount with your savings account balance either, there is no need for that.  Once you grasp the idea you will be moving money around between your budget categories anyway.  I included the YNAB links below that has a better explanation.

    https://docs.youneedabudget.com/article/202-budgeting-your-savings

    https://docs.youneedabudget.com/article/1679-why-doesnt-my-category-balance-match-my-account-balance

    Like 4
  • As others have said, what are you saving for?  If you don't specify what you want, you'll think to yourself, OK, I have $x.xx in my savings.  That means I could repair my car if the transmission goes out, OR I could put braces on my kid in a couple years, OR I could replace my refrigerator that is getting old. OR etc. etc.  However, what if those become ANDs?  CAN you replace your car, and your refrigerator And your water heater all at once?  On the same month that you lost your job?  That's why you put them into categories, so you can see exactly how much you have, and what it could be saved for.

    Obviously they're not set in stone, if you have saved up for refrigerator, and the transmission goes out, you can move funds from house repair to car repair.  You'll just have to start saving up again for both categories, to cover the next related emergency.

    And really if you think about it, your monthly utility bills are really "saved" until you pay them, right?  Just for a much shorter time.  But that's what the categories in your budget are for.  To hold money until you spend it.

    Like 4
  • Violet Cello said:
    then it will say you have a positive amount left over and did not budget correctly

     I think this is the immediate crux of your issue.

    Having a positive available in a category simply means that you have that much money saved/earmarked/allocated/sequestered/etc. for that particular purpose. 

    In fact, if you want a category to grow over time, you need to do that.

    Zero-based means that TBB is zero because your categories hold all your money. Zero-based does not mean that the categories should also be emptied each month...

    Take some free classes to learn how YNAB works.

    Like 3
  • Violet Cello said:
    Superbone and others saying you don't have to spend it, or just make a category for spending it.  I don't think you all have ever used this app  with a linked account before. This program expect a "zero sum" account or zero remaining "to be budgeted" each month or it says you are wrongly budgeting.

    Let's see. I'm not sure where to start. I first bought YNAB in July of 2008 and I've been using it ever since. I'm what you might call a YNAB expert.  And all of my budget accounts are linked. So, now that that is out of the way, yes, you should always budget To be Budgeted to 0.

    That has absolutely nothing to do with spending. When you budget TBB to 0, all your budgeted funds are dispersed among your various categories. These categories have various purposes. Some are to be spent soon, some to be spent later, and some to be spent maybe never aka long term savings.

    My Groceries category hold the funds I plan to spend this month. My Christmas category, I don't expect to spend most of it until December although I might buy some gifts along the way. My House Maintenance category is ready to be spent only when issues arise with my house. My Income Replacement fund which contains six months of salary, I hope to never spend for that purpose but it's there just in case.

    I hope that helps. Keep asking questions and you will get there. This is the best saving and spending plan software methodology you could ever use.

    Like 7
  • Violet Cello said:
    This program expect a "zero sum" account or zero remaining "to be budgeted" each month or it says you are wrongly budgeting.

     I’ve been using YNAB since 2014. I have 3 checking accounts and 3 savings accounts on budget. My TBB is always zero. My category balances build and build each month as the unspent available rolls over from month to month. I am using YNAB as intended. One thing though, I don’t use goals, so I don’t have any warnings about underfunded goals in my budget. 

    Like 2
  • I think I can relate to Violet Cello .   I have a Linked Checking Account and Linked Savings Account.  I am using categories for Budgeting and its working well.  I have saving categories for vacation, emergency fund, etc. Currently my linked Saving account has $2000 in it.  It is not allocated to any budget(yet).  If I want to allocate any of the $2000 to any category, I need to physically transfer from Saving to Checking and then allocate to say Vacation Category...but my Saving Account is depleting.  If I move all of it, My Savings account drops to 0..when I have to maintain a minimum balance.  I am not sure how this works.  My $2000 in my Savings is not working for anything.  What do you do in this situation?  I really don't want my Checking account increase to $2000 knowing I have that money available.  I currently show a running balance on the side of my budget screen. 

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    • Orchid Colt All accounts that are on budget (not tracking) should be completely allocated in the budget categories.  The budget does not care which account the money resides in.  You can leave the money in the savings account and still budget it to some of your savings categories.  The only thing you need to watch for is that the payment account (checking for most) has enough money to cover upcoming spending.  You transfer money between accounts as needed and when you do that a category is not need for the transfer since the budget does not care which account the money resides in.

      Read this article https://www.youneedabudget.com/the-relationship-between-your-budget-your-accounts-its-complicated/

      Like 2
    • Orchid Colt When you say that your linked Savings account is not allocated to any budget yet, do you mean that is a tracking account rather than a spending account?  If you are going to budget the money from your savings account in YNAB, the savings account needs to be budgeted.

      If it is a spending account and you have not allocated the funds yet, that would mean that the money is still in 'To Be Budgeted'

      Like 1
    • ynaber2613 I did read the article. My saving budget is not a tracking.  I could manually do a transfer from Savings to Checking and allocate money to categories, but I would not physically do that through my bank.  The YNAB Savings account would show 0, but my physical bank account still would have $2000 in it. That's confusing.  I wouldn't know where the money is. would I?   I just wouldn't see it in YNAB.  It's buried in the budget somewhere.  My current planning is fine.. and budgeting correctly and paying bills as needed.  it works.  but this Savings is not making sense. 

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    • Orchid Colt Why would you transfer from Savings to Checking in YNAB if you were not transferring in real life.  If your savings account is on budget and your To Be Budgeted is $0, then you have already allocated the funds from your savings account to categories.  

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    • chicagouser What I meant is I have $2000 in a physical Savings account that is not allocated to any budget category...meaning those dollars do not have a job.  

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    • Orchid Colt But if that account is a spending account in YNAB and your To Be Budgeted is $0, then you already have given those dollars a job.

      Like 2
    • chicagouser Hmmm. yes My To Be Budgeted is 0 and I keep it that way.  If this is the case.. my budget is screwed up.  I wouldn't  know where the $2k money is budgeted to. 

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      • WordTenor
      • Can we agree that goals are dumb and immature? Sure.
      • WordTenor
      • 2 wk ago
      • 5
      • Reported - view

      Orchid Colt Definitely read the article linked above. I suggest not only reading it, but making a fake budget and actually doing the steps as you read it. 

      YNAB deals with all your money. So if you have $3000 in account A and $2000 in account B, $5000 is what the budget is made up of. YNAB doesn’t care how much you have in accounts A and B, just that the sum is $5000. So then, of that $5000 maybe $1000 is for vacation, and $2000 is in case you lose your job and $2000 is for groceries, rent, dining out, gas, etc. 

      But oh no! Now you have $3000 that is “savings” (vacation + lose my job) and only $2000 in account B, which your bank has named a “savings account”. Now what? 

      Absolutely nothing. Because as long as you spend only the $2000 that is for everything else, you’ll still have $3000 left across your two accounts. It doesn’t matter which account it’s in; as long as you abide by your categories, the money you’re saving will stay saved. 

      Like 5
    •  Orchid Colt This is great advice (and a great explanation) from WordTenor  .  YNAB can be tricky in the beginning because it is very different from the way that most people are used to budgeting.  But once it clicks, it is very easy to use.

      Read the article and maybe watch a few videos and play around with a test budget as WordTenor suggested.  Once you understand the principals, you might want to start fresh with your own budget.

      Good luck - and continue to ask questions if you need it.  This community is very helpful.

      Like
  • ok, I am going to run through it again and hopefully it will sink in.. thanks for everyone's  help.🙂

    Like 2
    • Orchid Colt Good luck in understanding this principle.  I, like you, used to think my accounts were used for specific purposes.  I even had sub-savings accounts for vacation, home improvement...  Once the light turned on that I could completely divorce the accounts from the categories that was such a freeing experience and basically unlocked one of the successful principles of YNAB and led me on a path to simplicity.

      Like 1
  • ok I did a simulated budget based on the article... It totally makes sense now. I tried to fix my original budget to compensate, but ended up screwing it up.  I had to built a fresh start budget.  It totally makes sense now.. It unbelievably make sense now. !! .  Can't believe I didn't see it at first.. thanks so much everybody for making me see the light.  

    Like 8
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