What is Considered Income?

Is income only what is earned or is it anything that is an inflow from any source?  For instance, let's say I buy a shirt for $20 and then return it.  Does the $20 go back into the clothing category or does it first go into the Income: To Be Budgeted and then moved into the clothing category?

Since the $20 for the shirt will be shown as an expense on the Income vs Expense Report, it seems to me that I would have to show the $20 first as income and them move it to the clothing category to keep the Income vs Expense Report  accurate.

I'm only in my second week with YNAB (coming from Mvelopes 5 after a very long history there) and am very happy so far with what I see here - thanks!

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  • Returns would get categorized back to the category they came from.

    New money entering the budget (paycheck, interest, cashback rewards (I think), gifts, etc) get categorized as TBB.

    Like 1
      • Rick
      • Mvelopes to YNAB Convert
      • ricka47
      • 1 yr ago
      • 2
      • Reported - view

      adriana01 That makes sense and seems to work - thanks!

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      • Herman
      • herman
      • 1 yr ago
      • Reported - view

        Rick I do it this way as well but it is really an individual choice, the software will let you do it either way.  If it is a credit card purchase, the way you handle has different impacts on your cc payment category.

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      • Rick
      • Mvelopes to YNAB Convert
      • ricka47
      • 1 yr ago
      • Reported - view

      Herman Thanks - I pay the balance in full each month.  So, whatever I do, I want the credit card payment category to accurately show what I owe.

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      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 1 yr ago
      • Reported - view

      Rick You're just going to have to keep an eye on it. There will be times when it gets out of sync for one reason or another and you'll need to manually adjust.

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  • I would put the reimbursement back into the category it was spent from (i.e. clothing). In the end, you really didn't end up buying the shirt since you returned it so the net effect on your clothing category would be zero.

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