Level Up My YNAB Budget

You may have been expecting another Mins Game post today, but I’m still working on that… So I’m going to start on another topic that I haven’t touched on in a while… my finances! I haven’t done a financial update post in a long, long time… (Last one was June 2018.) But don’t worry, I haven’t stopped budgeting or using my beloved YNAB (You Need A Budget)… So today I wanted to give you a small update on how all that is going…

Note: this post is not sponsored in any way, I just really love YNAB.

I don’t think it’ll come as a surprise to anyone who has been reading my blog for a few years that I love YNAB. It’s a budgeting application that really speaks to me. Originally, when I started using it, it was a software that you purchased (one time purchase), and it used your own drop box account to share the budget between different computers or mobile apps. In recent years, they have moved to a web based app with an annual subscription fee, but you were still able to continue to use your one time purchased software if you wanted. And so I did, because I hate being pushed in to annual subscription fees…

But… Last fall, I decided to finally check out the new app (I think I was actually forced to because a new operating system on our home computer was no longer compatible with the older version that I had been using). They offer a free trial (34 days – so you can go through a full month – and if you use my referral link to sign up we can both get a free month!), which I did before I committed. I exported my existing budget data, and transferred it all to the new app… I didn’t want to lose any of the historical information stored in the years of budgeting that I had done. I will admit that there were some hiccups in the transfer, and the first month in the new app I have purposely noted that it is the “transition” month because there were some messy things I had to do to get the numbers to line up. But… since that process was done, I really liked the new features, and also appreciated that the synchronizing between devices was seamless. It was “supposed” to be before, but there were always weird things that didn’t mesh well when inputting on the phone app, then looking at them on the computer program…

Anyway, fast forward to last month, and I’ve been using the new app for a while, things are going pretty good. I figured I knew what I was doing with the app. I was using it well. We have been through a few changes in our finances, had some large expenses and gained some new debt, had some variable income… We are coming out the other side now, and things are starting to settle out, and then… BAM! I found the YNAB youtube channel… And man, the game changers that I have learned in the last few weeks of watching their videos… It’s not that I was using the app incorrectly, it’s just that there was so much more that I could do. And so I wanted to quickly go over some of those things and how they are helping me get ahead with out finances.

1. Emojis

This first one is just fun, more than anything… I only just learned that we can put emojis in to the titles of categories. All my categories before were just boring text. Now I have put in a bunch of colourful emojis that make the budget screen much more fun!

2. Monthly Budget Template

YNAB has the ability to set goals for each of the categories, however, I was never really using them before. I had set some long term goals (see the next item in the list), but after watching some of the videos I have created goals for every category in my budget. Most of them are either monthly spending goals or repeating annual goals.

This makes budgeting for the month so much easier because they have this “underfunded” button that you can use to just budget for each category the exact amount to meet your goals. It takes so much work out of it, and it lets you sum up what goals are underfunded, so you can see how much income you need to bring in each month to meet your goals. In the YNAB videos, they call this the monthly budget template.

YNAB is all about only budgeting with the money that you have, but it is nice to be able to forecast a little bit in to the future to know if you need to be stressing about the upcoming bills, and find extra income, or if you can relax and just put your money to work when it arrives in your account.

3. Long Term Goals

Similar to the monthly and annual goals, I have some longer term goals (which I will talk about another time), but some of them if didn’t make sense to have a set end date because they don’t have any particular deadline, other than some future idea in my head. I still wanted to be able to see these goals in the hopes that down the road I’ll be able to earmark extra funds (my current self is laughing at that possibility, but I have dreams) to these goals.

With that in mind, I actually made a new category group, similar to the Wish Farm that the YNAB videos explain. My husband had our wish list in a note on his phone, and we had actually bought a few things off of it recently, but we hadn’t ever budgeted for them ahead of time, we just “rolled with the punches” when we made those purchases. So we transferred that list from my husband’s phone to YNAB and made some goals for them, along with some other random goals…

When we purchase these things eventually, they will be purchased through an existing category, not here in the wish list, so because of that, I put in the actual category that I think the eventual spending will be in. This makes it clear for me in the future where I need to move this money when we get the goal fully funded.

One of the best things about these long term goals, is that if we don’t put a deadline on the goal, it does not get included in the “underfunded” total that is used for your monthly budget template, but you can still put money towards it when there is extra.

4. Credit Card Balances

I don’t normally keep a balance on our credit cards. There was a time a while back where we were just coming back from my maternity leave, and things were tight, and the credit cards were being used to their full delayed payment potential. (Meaning we were definitely NOT using last month’s income… in fact, we were barely using this month’s income…almost more like using next month’s income… NOT the ideal situation.)

Anyway, all that to say, that when I started the new YNAB version, the credit card numbers should have matched, and there should have been no issue, but that was not the case… I was a bit confused with the numbers in YNAB for the credit cards. I did everything manually with credit cards before the new app updates, meaning that I didn’t look in YNAB to make sure that the amount that I was paying on the credit card matched what we had budgeted for the payment, and so when I moved over, I didn’t change my methods. However, this meant that I wasn’t following the YNAB rules…

So a combination of this and probably some mix-ups with the import of my old YNAB budget made it so that according to YNAB, I never budgeted a full payment on my credit cards. This meant that my budget was not happy with my credit cards, and now that I know to look at the budget for how much to pay. The payment that the app has calculated uses the budget to use your actual dollars that you’ve budget for things you’ve purchased on your credit card. If you haven’t budgeted enough, it will show it as overspending.

Now, every time I see the overspending, I know I need to move some money around in the budget to cover that. Now that I know that I messed up the credit card payments in the past, I am working on fixing the numbers in the budget for my credit cards. I have finally found the part where the app tells me how much I missed in previous budgeting, and I am slowly working to get that covered in my budget. I could probably “rectify difference” right away, but I’m trying to do other goals too. (This seems strange because I don’t actually carry a balance, but I typically only pay the statement balance, not the “reconciled” balance. It’s mostly about making the numbers in the app match.)

5. Hiding Categories

When you are done with a category in YNAB, unless you want to reallocate all the budgeted money and the transactions that were classified in that category, you don’t want to delete that category. Instead you can just “Hide” it.

I have hidden a few categories in the past, but I didn’t really make use of it like I should have. See, it is actually so simple to hide and then unhide categories, so if you aren’t using a category right now, but may want to use it in a couple months, you can totally just hide it and unhide it whenever you want. It doesn’t change anything about your budget, but it cleans up the look of it so you aren’t plagued with a bunch of categories you aren’t actively using. This means that I could probably split up some categories to provide myself with a clearer picture of some of our spending trends, and I can create categories for temporary expenses or goals, and not lose any of that data when I hide it. And if it comes up again, I can unhide it later on.

I don’t think I’m selling it very well at the moment, but it was a pretty big thing for me to realize. I still haven’t made total use of it, but I have hidden a bunch of categories that are not currently relevant to our life, just to keep the budget clean and focused.

If you use YNAB well, none of these things are probably that new to you. But I wanted to share because it has totally helped me improve and rekindle my enthusiasm for budgeting and working on my financial goals.

This of course leads very well in to the financial goals that I’m currently working on… So I’ll post about that next time.

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