Does anyone use YNAB (You Need A Budget) and fancy a support/chat thread?

[lougle]

I've just got the trial version and I'm hooked, if not slightly overwhelmed. I'm currently in 'why is it asking me to budget so much money' mode.

I'm hoping that I'll really take off with it because it sounds quite life-transforming.

Oooh ok. This springs to mind:

You could allocate your whole overdraft amount to a category called 'expenses buffer' each month.
Then, you have a category called 'expenses' which you allocate money to from the 'expenses buffer'.

So, an example:

You have in your account £3000. But your available spending is, say, £8000 because your OD is £5000.

You enter into your bank account a deposit which matches your OD limit. (Bear with me).

So your 'balance' on that account is 'amount in account + amount available as OD'.

On day 1 your budget would look like this:

Available to spend: £8000

Then, you would allocate first and foremost, the amount that is your overdraft, into your 'expenses buffer':

Expenses buffer: £5000
Expenses: £0

Available to Budget: £3000

Which is right, because your real money is only £3000.

When you have an expense, say £200 hotel bill, you do this:

Expenses buffer: -£200= £4800
Expenses: +£200= £200

The hotel bill is categorised as 'expenses'.

This leaves your real money at £3000, because you're using your OD for those until they're reimbursed.

If you then have to spend £500 on flights, you do this:

Expenses buffer: -£500=£4300
Expenses: +£500=£700

ATB will still be £3000.

This method will only work if you don't spill over your OD into Your money for expenses. Well, it would still work, but you'd start to get a negative number in your buffer and then your ATB would go down.

I use this method for a savings account which I like to have 'on budget' but I don't like the money in it affecting the rest of my budget. So I have my DD's DLA paid in to it, and I budget the whole amount to a category called 'DD's DLA'. Then, if I need to spend any of it, I reduce the amount budgeted to 'DD's DLA' by the amount I need to spend.

Will have to look through your idea in properly when I've got time, it looks like ti might work, thankyou! Does it rely on us putting in the physical amount of our overdraft to get a 0 on the budget? We don't have that sort of money, live on less than DH often turns around in expenses each month!
Will look more closely tomorrow - thanks though!

Basically, all it's doing is taking the expenses out of the equation. If your DH uses £3000 of your own money to pay for the expenses, then you have to have that money somewhere in your budget, be it in your account balance or in your overdraft, or you couldn't spend it.

You get confused because then you're not sure how much money you have left.

I'm suggesting that you categorise that money as expenses, with the corresponding amount of the overdraft you use budgeted, so that it zeroes out.

Of course, if you actually use some of your income for the expenses and then just spill over into the OD, then it's a bit more complicated.

The other option is to just have expenses carry forward to the following month on the budget. The only worry there is that you are, in effect, over spending and if you do that you can't rely on the figures for your budget, which is where I think your confusion lies at the moment. If you simply carry over a spend of £50, then it will seem as if you can still spend that £50.

Thought I would update about the overspending on my birthday DH. We talked. He understands, and produced receipts for a couple of books that I knew I wouldn't miss. He also had £60 in his paypal account from selling some stuff, which I've allocated to a "DH fun/presents" category. It is still showing a massive overspend, which I'm taking forward in that category, and it will be paid off bit by bit. I haven't been able to get him to look at the App - his approach seems to be for anything a bit discretionary to phone me first, which makes me feel like the power balance is somehow wrong. However, he doesn't feel that, and just says that is an easier way for him to do it.

We've been able to spend money in this month by using a prepaid card linked to our utilities that gives us cashback off our bill, so I don't feel like I'm missing out on John Lewis vouchers too much .

It will be a long time before we are out of the credit card float, and we don't have big red numbers at the top of our budget for a lot of the month - but we'll get there. Only the second month of YNAB - and it is already helping so much.

Hairy, YNAB has an FAQ on this that links to the article and video on it. I think lougle is right though - you need to partition off the money that is only being temporarily spent, if that makes sense. You could have an off-budget account called work expenses, but then you've got more faff making the real account balance correctly.

It would be easier if your DH had a credit card that was used for all business expenses - I would have thought from a cashflow point of view as well, since presumably he would be reimbursed considerably before the billing cycle of the card?

callmeCordelia, good news that your DH seems to have had a bit of a breakthrough. I don't think I could hack being called for every expense, maybe try and throw it back a bit to him, e.g. "well, I'm looking at the balance in that budget category now and it's [x], so what do you think?". Might help him get the message that it's his decision.

Re the expenses post by Hairy, would it be a good idea to have your overdraft on YNAB as a separate account? You could have a starting balance as £8000, and budget £8000 to it. Any expenses get taken out of this "Overdraft account" which would keep them all neat and tidy from the point of view of checking transactions. There would still be a problem reconciling though, you'd have to do some maths to make sure the balances worked.

Another way of doing it might be to get a credit card with 0% on transactions (Nationwide are doing one at the moment where the 0% offer runs for 15 months), and your DH using that for expenses? You could then just run it off budget, and it wouldn't affect your ATB at all. If he is claiming for fuel and running costs on a car you own, you might get a credit balance in the account if you transfer the whole amount he gets in expenses to the card. You could just transfer money back when the car needs servicing, or just pay off exactly the amount on the monthly statement, and keep any surplus back in an on budget account. The downside to this would be you'd need to be watching like a hawk for a deal at the end of the 15 months for 0% on balance transfers and purchases when your deal ends.

X Post with Tribpot, who said all the same stuff as me about Hairy, in a much more succinct way.

Ah ha! I'm so glad to find a YNAB thread here! Hubby has been using it for a year and loves it, but I just let him get on with it, money and numbers aren't my forte! He uses it to manage our household salaried income and also runs a little 'freelance' mini-budget as well. I think you can run multiple separate budgets but he does everything all in one.

We've got loads saved up in various little pots for future expenses, we started saving for Christmas back in February and had no nasty surprises come December! Love it. LOVE IT.

Do you enter transactions, merovingian, or do you leave it to him? In the case of the poster above, where the DH feels the need to phone her before every purchase so she can check the budget, is that how you work it?

I'm glad to see, though, that the benefits are clear even to the 'passenger' in the budget process; my DH doesn't take a lot of notice of the budget either, although knows it's there and that the money for stuff has to come from it!

Folks, is YNAB any good if I don't have access to a desktop PC? We only have Apple products, phone and pad...

No, you need a desktop currently, Mum2Fergus. They are working on a full-blown app for the iPad but it's not there yet.

Thanks, will keep an eye out for next version...

50% off YNAB with Steam at the moment - just bought it.

How do you get into discipline of using it?!

Having spent money on buying it tends to focus the mind somewhat :)

Really it's just a habit. I've been a bit lax of late and tend to catch up twice a month or so (entering cash transactions as I go when possible, since that's the 'black hole' I can't fill in later). My budget's going to be a bit tighter in the start of 2014, though, so will need to get back to a more disciplined 'every other day' type approach.

The set up takes a little while, but there's plenty of help, esp at this time of year when they run a LOT of live classes for newbies. The classes are great and completely free, even to non-YNABers. No selling or anything like that.

And really the best motivation is seeing it having results quite quickly. A small surplus at the end of the month, or not being knocked sideways by a couple of birthdays falling in one month, or just having a clear picture of where the money is and what it's doing.

Okay. I need to look into the live classes. I have just spent this evening putting in all the transactions for the whole of December - created an "extraordinary expenses" category where I shoved things while I think about whether they need to be regular budget categories etc. I think I am figuring it out… It hasn't revolutionised my life yet but I remain hopeful…

I have downloaded the ap for my iPhone & think that will be really useful, as I have a long commute & could possibly spend time tweaking things on then. Also will record my cash transactions as I go along since we spent £256 somewhere in the ether between the cash machine and the cash till in December! Hope that I can get DP on board to do the same

Good good Jane - but the important thing with YNAB is not to look backward to this month's transactions, it's to look forward to next month's budget (accepting you need a baseline to start from, i.e. December's transactions). Have you done your budget for January? (I haven't done mine!)

Might be worth putting in a category for Christmas 2014? Depressing I know but starting the savings at the beginning of the year is the right way to go.

Yes thanks for that reminder. I haven't done my budget for Jan as James Bond had finished & DP wanted to go to bed but I will do. Definitely needed to enter in Dec not just for repeating bills but to have some sense of what we do spend at the moment & what budget is realistic. Also looks like we will finish the month with a bit of spare cash which I am looking forward to assigning to saving categories! Can already see the difference though as all my previous budgeting attempts have been entering past data into spreadsheets not thinking about data going forward.

Hi - I have just started ths, and am feeling a bit twitchy about it. Basically - as I understand it, you enter into the "budget"page the money you have available to spend and where you are going to spend it. But there doesn't seem to be anywhere to put a forecast? S I already know how much my bills will be and when I need to pay them - but I can't actually put them on the budget until I already have the money to pay them. Is that right?

I am worried I am going to end up missing something...

Oakmaiden there are ways of using YNAB for forecasting but the idea is not to allocate money you don't have.

Obviously you still want to plan the month's expenses since you can't be randomly deciding with each pay cheque based on what bills you can remember, so what you can do is put categories in for each bill, and have the category name include the day of the month or the amount, so you've got a reminder of what will be coming out of the next pay cheque, but not put the funds in until you actually have them on hand.

This is part of the idea of living on last month's income - so that today on 31 Dec you have on hand enough money for all your expenses to 31 Jan and then can allocate to every budget category in one go. For a lot of people in the UK this is actually quite easy, if you get paid monthly at the end of the month for example. You might have 3 or 4 days at the end of Jan which you should fund from December's pay cheque despite the fact you will have been paid again by then, but nothing like the situation people who are paid weekly or fortnightly have when building up a buffer to get them to Rule Four.

What you can do allocate money to the categories which will be paid later in the month, and just have the budget showing as in the red until the money to pay the bills comes in. When the money comes in, you mark it as 'Income Available to Budget This Month' and suddenly your budget will go from red to green. You know this doesn't mean you're about to go bankrupt, it just looks uncomfortable for a week or two.

I think I need an extra column... something like "anticipated monthly expenditure". I can see that it will work very nicely when you have a month of money in hand - but at the moment I am aware that I need to pay, for example, £500 for one particular thing this month, but there is nowhere to record to myself that I need to keep adding to this pot until it has £500 in it... Unless I just keep it on a piece of paper next to my computer. But that kind of seems to negate the point of having a piece of software...

I am very confused. And I have spent too much money over Christmas.

My wages do come in weekly too - which makes it harder I think... although my husband is paid monthly...

So you need to budget £500 to it. You can do that. And the software will show that the budget has -£500 in it. Which is correct; you need 500 quid and you haven't got it. (Yet).

Let's assume you have £400 in your current account. That means your January available to budget is 400.

You have nine categories (rent, gas, electricity, food, fuel, Council Tax, water, phone, clothes). You budget 100 to each of them, that is you enter 100 against each category in the budget screen. The available to budget figure will now be -500.

On 2nd Jan you pay rent, gas and electricity, so in the current account you record 3 transactions, each of 100 quid. You assign them to the categories rent, gas and electricity. On the budget screen you will now see that there is nothing left to spend in those categories this month, the outflow in each is -100 and the balance is zero.

On 5th Jan you get paid 200. You mark this as available to budget this month, which means your available to budget is -300 now.

On 6th Jan you pay for fuel for the month. It turns out you only need to spend 80. So the outflow is -80 and the balance in the category is 20. You could leave the money where it is, or you could change the budgeted amount to 80, which would mean your available to budget is now -280.

On 10th Jan you get paid 300. You mark this as available to budget this month, which means your available to budget is 20, because you'd already accounted for most of the money in the budget. You haven't spent it yet, but you've allocated it. Your current account hasn't gone into the red, you've only spent 380 up to this point.

The 20 quid should be budgeted to something, following the rule 'give every dollar a job'. If you know you won't need it this month you can add it to the available to budget next month instead, slowing chipping away at the buffer you need to be able to live on last month's money.

You might want to run this scenario in YNAB. You can start another budget file so you haven't got to mess up your main one - just hit File -> Create New Budget.

Otherwise if you haven't watched the videos on the website I really recommend that, or take an online class - they are doing them back to back tomorrow I think

Thanks. That makes more sense. It was just the idea that you "weren't supposed" to put anything in the budget column until you had money available to cover it was stressing me!

Hi, I just downloaded YNAB, the free version. I notice that steam has an offer till tomorrow, and I think I will definitely order it through steam, but how do updates work when buying through Steam?

My money coming is very erratic (supply teacher) so I never know how much money I will have week to week. But there are still bills to pay (whether I have work or not) and I just get my head around how it would all work. It is something I need I think because I am completely in the dark about how much money I actually have. I am a bit scared of what I will find.

And some of you have said that you keep track of cash through YNAB - is that through another account that's not linked to your main account?

Do you mean software updates, NotAsTired? Steam updates software you have purchased through it automatically...

I'm a supply teacher too - it does make planning ahead tricky, doesn't it? I have always had a real "bury my head in the sand" attitude to money which doesn't help me at all.

I keep track of my cash too - basically I have one budget, but have 3 accounts within that - my main bank account, my personal cash, and my husband's personal cash.

I am still getting to grips with the whole thing - as you can probably tell by my posts above.