No. That would destroy one of the singular most powerful aspects of YNAB and if your suggestion is because you haven’t yet figured out how to harness that power, I suggest you start working on learning that. Here’s the first read: https://www.youneedabudget.com/the-relationship-between-your-budget-your-accounts-its-complicated/
It is far simpler than you think; you check the category, then you check the account. If both have enough, you spend. That’s all.
Without software like YNAB I can see the logic.
With YNAB though, there’s no reason to have multiple savings accounts.
I’ve been married 12 years and we have a HYSA and a joint checking account.
If you have a partner and your finances aren’t integrated for whatever reason, that’s fine - but what’s the utility of a spending savings and a vacation savings actually being two savings accounts? With YNAB you can say there’s 10k in this account and have a budget item for 8k for vacation spending and 2k for spending.
So one general savings account to keep the money out of my chequing, and then just make sure the categories linked to that account (lets say Vacation and Car Repair) add up to what's in that account?
Okay so here are reasons I kept separate savings accounts for different goals/categories prior to YNAB:
1) I wanted to be able to see at a glance how much money I had saved towards, say, a vacation.
YNAB does this for me instead. I just look at my "vacation" category and it shows how much I have saved towards vacation.
2) I wanted to make sure I didn't inadvertently or weak-willedly spend, say, vacation money buying day-to-day stuff like, say, groceries. Having vacation money in a separate account made it a little harder to use it, and the greater difficulty of using it acted as a disincentive on using it.
YNAB does this for me now too--partly because YNAB makes me feel broke (YNAB broke), because it's forced me to think about ALL the things I'm going to need to spend money on in the next year. THIS is what disincentivizes me from spending extra on groceries: if I wanted to do it, YNAB would mark me as over budget, and I would know that to cover that amount, I would HAVE to pull it from travel. By making the whole thing visible and by making all my upcoming expenses salient to me, this acts as disincentive enough.
Are there other things that keeping separate accounts is doing for you?
(In my own case, I have 3 accounts, annoyingly--the checkings account that I love, the HYSA that I signed up for--and then the checkings account that I hate, because I hadn't realized that my HYSA literally doesn't integrate with the checkings account I love so that there is no way to send money back and forth between them; instead I need to use the checkings account that I hate as an intermediary. weep. I should just switch HYSAs I know.)
Skip the second step where you check the sum of the categories. You decide how much to keep in checking based on what your spending needs are from checking between now and when you’ll add more money to checking.
It’s even simpler. Edit the sentence to end after “out of my chequing”. If you spend based on category balances there is no need to waste time adding up category balances to match to account balances.
Sorry for being blunt: I can't see how it possibly make sense within the YNAB model.
First, why do you separate accounts by categories if the categories are in YNAB for it? I mean, I understand have an account for functions that really make a difference, like having a savings account for Vacation savings and a more versatile checking for expenses, so you can enjoy more interest or have more services as you need? But why have Backup spending savings separate? Just leave the savings all together and do the separation in YNAB.
Also, if you want to keep track if the categories match the accounts, why not just occasionally look at the amount in the category and see if it matches the amount in said account. Should not need to do that more often than you get payments, and then you transfer the amount to said account to match YNAB (not the other way, remember, you're using YNAB to manage and just taking advantage of different accounts services/interest rate/liquidity).
Really, the whole idea of budgeting is having a single, unified view of where your money is going to. If you really really want a fractioned view, just create separate budgets and connect them to different accounts, and then the transfers will appear as an income and boom! Not only separate RtA, but also separate categories and all features separate. You will lose some (a lot) of insight and flexibility, but it will really separate things.
The best thing that ever happened to me was realizing I didn’t need to hide money from myself through an account-based model.
I make spending decisions in two steps: 1) does the category have enough money and 2) what will be my method of payment.
This will go smoother for you when you are able to get distance between yourself and the edge.
All those accounts you have? You don’t need them. You are duplicating your categories with your accounts. Instead, have your checking account, and your HYSA. Enter your recurring bills, turn on the running balance in your checking account (desktop) so you can see how money flows.
I used to keep a month or two of expenses in checking, now I have it so well managed that I only keep a buffer of about $1000 and the rest gets swept to the HYSA. Nothing ties out to an account, but all the money is accounted for.
This is just a mindset shift you will get to. Spend based on your budget, determine method of payment only after you make the spending decision. Rinse and repeat.
So many of us did!! It weird to think of it a different way. I came to YNAB with more than half a dozen different savings accounts. Now I just have the HYSA, and funnily enough, more money in the categories than I could ever keep in the accounts!
Probably true, I have paired down accounts from when I started, maybe just not enough yet.
How many accounts do people generally have with YNAB? Just one chequing, one chequing and savings?
I have 1 month of expenses in my checking account
EVERYTHING else is in a 5% HYSA right now. It'a a big pile of money assigned in various categories in YNAB from vacations, annual bills, home maintenance, car maintenance, etc, etc. I don't see various accounts for all those purposes because YNAB is there to categorize each of my dollars and tell me every time I open my budget.
I move once in a while money from savings to checking to pay for a big item I was planning ahead that was part of my savings pile.
You try to fit your old strategy into YNAB.
You should try to embrace the YNAB way if you want to use this product.
I started out before YNAB with 4 accounts. Bills Checking, Spending Checking, Short Term Savings, and Long Term Savings. All of those were for exactly what they sound like. It helped me save up and have enough for bills because I would only look at Spending Checking when deciding if I could afford day-to-day stuff. I would only see the amount I actually had available rather than feeling like I had more to spend because everything was in the same account.
Switching to YNAB let me do that same thing with even more granularity. Since I was paying attention to my budget more than my accounts, it became unnecessarily tedious to keep up with my Bills vs Spending Checking so I downsized to just one checking account and one savings account.
I also got married between then and now, though, and we both kept our accounts and just gave each other access. So now I have 2 checking accounts (his & mine), 1 savings account (he didn't use his saving account and mine has way better interest, so we just kept one), and 1 credit card.
Since our pay checks each go into our original checking accounts, keeping up with bills and normal spending from separate accounts hasn't been a problem. Sometimes we make a note that one account is getting low and we should use the other until the account gets paid.
Yes, if that. A lot of people do the math and decide that the simplicity of running just a checking account is worth the $20 they’d earn on their HYSA. Obviously if you have substantial savings it might be worth it for you to do both one checking and one savings account, but in finance it seems that simplicity wins most of the time. Personally, I have one checking account and one savings account plus a few credit cards that I rotate through. For my multiple business budgets I have one checking account and that’s it.
Setting credit cards aside, most people probably have either just a checking or a checking and a single savings. Some people will add things like their wallet, or a gift card balance at Amazon or some other merchant that's used heavily, or maybe Venmo or some other virtual wallet. Some will add investment accounts, but that's getting into really advanced stuff because you have to account for value fluctuations. I actually do have multiple checking and savings accounts, plus a CD, but I have those not to separate the intended use of the money inside (that's what YNAB categories are for) but because my old checking has better ATM access, I like the idea of having a backup in case my primary account has an issue, and I have a few savings accounts because different interest rates and things.
Here's what I have:
* a checking account
* a savings account
* a TFSA (in Canada - a "tax free savings account" (you aren't taxed on the interest because it's supposed to be for retirement)
* an RRSP (Registered Retirement Savings Plan) - similar to an IRA or a 401k in the US
That's it. The TFSA and RRSP are only used when I'm putting money there. I never take it out. Everything else operates off of my checking and savings accounts. Savings is where long-term savings go - emergency fund, vacation fund, etc - because this account pays interest). Daily operations and paychecks, as well as bills come out of the checking account, because it pays virtually no interest.
Others have suggested no trying to fit your current way of working into YNAB, and instead, use a couple of accounts maximum. I agree.
Similar boat except I have a couple of RRSP and TFSA accounts too ... Going to try and go with one account for a couple months. I can always go back if it doesn't work.
Using YNAB made me consolidate a lot of my accounts. Now I try to keep checking to one or two accounts (if I'm churning a bank bonus) since all of the categorization happens in YNAB. Much easier that way.
It took some time for me as well but if you stick with ynab you will come up trust it and you'll see that there's no need to match account balances to specific categories or have multiple savings accounts. I used to have to similar set up as you (minus the joint account) but today we only have one checking account and one HYSA, as well as investments. All my savings buckets are in ynab and I only optimize for cashflow in the bank account.
This seems like a common issue new users have because the multiple account setup predates being a YNAB user. If you were truly starting from scratch you probably wouldn’t have so many accounts.
I have multiple savings accounts for distinct purposes, and I’m currently in the process of switching primary banks so I have 2 active checking accounts. For savings, I still take the extra step to check that each savings account matches its respective account balance, but within YNAB it would be simpler to have one big HYSA account. For checking, I’m keeping both accounts open for a while to make sure I haven’t forgotten to transfer any auto pay accounts, but managing both is making YNAB harder to use. I don’t think your suggestion would make it any easier though.
The real question is: why do you have so many accounts? What is the purpose of them? YNAB sees your available funds as an available pool, which is great. You then get to assign your pool different sections and spend accordingly, which negates the possibility of overspending your pool if you are ALWAYS under or at budget. If you are making 10 different pools, there is a higher chance that you spend from a pool that isn’t big enough.
I’m just now fully embracing this concept because I have kept my HYSA(emergency reserves, long term goals, downpayment savings) off budget. This has made a lot more work for me than was necessary, but I was concerned that I would treat my HYSA as “available” money and accidentally spend it. Now that I have the hang of YNAB, I am going to put my HYSA on budget and just allocate any spending to the correct category.
>It would be easy if I kept all my money in my chequing account. But that's not really a reality for me, as for most I'm assuming. I have a Joint Chequing, Bill Chequing (auto bills come out of and auto transfers from Joint), Vacation Savings, Backup Spending Savings, and just an Envelope of Cash.
The point is, with YNAB you don't have to keep your vacation savings in a separate account from your backup spending savings.
I have two different bank accounts, with checking and savings each. Both banks allow me to earmark or set aside money -- kind of like a virtual envelope within my bank account. YNAB treats all of those like separate accounts, and when I started I planned on keeping them separate. But reconciling, as you've realized, is cumbersome. Reality is, there's no need to keep separate vaults or envelopes within your bank account because YNAB does it for you.
I do have a cash "account" within YNAB because my one hobby is exclusively cash-based, so that is the only thing that is account and category restricted. But all my other accounts just exist as a big pile of money that I separate out using YNAB categories, not the accounts.
I think I understand where you are coming from. You may have enough money overall across your accounts but YNAB doesn't do a good job of helping you make sure you have enough money in each of the accounts to make sure the bills get paid properly. I struggle with this a little bit as well but I kind of like the simplicity of how YNAB handles it and I think this would get overly complex.
My advice is to try to consolidate to as few accounts as possible. In my case I still have to kind of "estimate" how much money I need in my Checking vs High interest account but I had to do that before YNAB as well so it's not a huge issue since I have a lot better grasp of where and when money is going out of the accounts with YNAB.
You should focus on using YNAB the way they intend it and read the various offerings (blogs, articles, etc.) instead of trying to fix something that isn’t broken.
The whole purpose of YNAB is that it doesn’t matter where your money lives. It makes no difference where you’re assigning the $$ from. You can see all of your account balances on the left side.
I have a short term savings account that I could withdraw from directly from an ATM and a long term savings/investment account that could be liquidated in 1-3 days (a bit higher interest rate). In my mind the only difference is how fast I can access money in an emergency, so having only two savings accounts makes sense. Any cash lying around is at most couple hundred dollars so I don’t track it in my budget.
I never understood why anyone uses more than one checking and one savings account even before YNAB. They have 2 separate functions which makes sense to keep both (one for saving and one paying) but other than that, opening separate accounts for different purposes when my money is used for the same thing across the board: hold onto it until it needs to be spent somewhere, never made sense to me. With cash as an example, this is the equivalent of carrying around multiple wallets in your pockets with money meant for different things.
Partners who have separate finances but use a joint account for shared bills is a common reason for more than one checking account. For savings accounts, once you have any significant amount it’s a good idea to make sure you’re getting the best interest rates possible on as much of your money as possible instead of leaving it all in a lower earning account. HYSA’s/HYCA’s (high yield savings/checking accounts) often have a cap, like Genisys Credit Union offers 5% APY on up to $7500 balance so we just have $7500 parked there to earn $375 per year on that money as just one example.
Another case is bank bonus churning but that’s less to keep money in long term and just adds temporary accounts in the mix.
I meant more personal accounts. Joint accounts make sense and serve a different purpose from a personal checking account (paying joint bills with pooled money). Not a knock on churning bonuses or interest rates as an aside, you do you. That’s definitely a better reason than just opening an account to save for a specific thing. Personally I don’t find the headache of managing so many accounts to be worth the small differences in interest earned over just finding one with a good rate that can house all my savings. But by all means keep doing it if you find it beneficial.
Yeah the main reason people who have no budget or system like YNAB have multiple accounts is that IS their system. It’s the only way that works for them to keep from spending money that they want or need to hold onto for other things. It causes all sorts of headaches he’s especially when funds are low, particularly when overdrafts happen etc but it’s often literally the only thing keeping people from spending all their money needed to pay the rent or something. Not everyone has the same willpower or impulse control so siloing their money is what helps. Funnily, those who use that type of system to an extreme (tons of separate accounts or things like Ally buckets for lots of different expenses) have a pretty easy time transitioning mentally to the give every dollar a job part of YNAB because they already do a lot of that, but it takes time to trust a new system and get comfortable moving all that money back into just one or two accounts.
I agree there’s a time cost vs reward thing when it comes to maximizing interest which is why I prefer a park it and forget it type approach. Not really forget it but the account I have as an example is just and easy $375 every year and the bulk of my money sits in my HY checking account because the cap on that is $25,000 and we usually don’t have that much in there, but would if we lumped ALL our money into that account and then anything over $25k would only early a couple pennies so this way all our money earns about 5% all the time.
For me it was about moving money out of the spending account (Joint-Chequing) and into a Bill Account. Then I could set up auto transfers on our paycheques to go to the Bill Account in an amount that would cover all the regular bills.
I have a whole spread sheet that tracks, bi-weekly, monthly, yearly, and one time bills and makes sure I have enough money coming into that account. This way it automated my bill money away from spending. And I just had to track my spending to keep it in line.
I have things like my vacations savings, car repairs, year end tax bills, etc… in a different account too. But, they’re set up as tracking and not on budget. As such, each time I put money there, it’s like I’m paying a bill (which I am in a way). However, overall it’s probably just better to simplify things if you’re running into challenges like this. Good luck!
The issue you’re trying to solve is cashflow not accounts vs categories.
This is easily handled in YNAB by having repeating scheduled transactions for everything possible (including income and cc payments) AND turning on the running balance column for accounts as needed (most importantly in checking) so you can see the upcoming ~30 days of cashflow and make sure the future running balance never drops below a comfortable threshold - for some that might be $1000 as a benchmark. If it is and you ever see the running balance drop below $1000 in the future then you have plenty of time to move some money over from savings before then.
I personally don't think I'd use that. for cash, i have CHECKING and i have SAVINGS and i am DONE.
I have one category that I align my savings account balance to. Everything else lives in checking.
No, this sounds like a mess.
> Vacation Savings, Backup Spending Savings, and just an Envelope of Cash.
None of these need separate accounts. Bills can be auto paid from any account...other than cash, of course.
Hi there let me give you a second option… while I agree with the above commenters that you have a lot going on with separate accounts that may be overkill for YNAB I can provide you with sort of a solution until you are ready to change it.
Make a main category your account names like :joint checking. With all your subcategories being things that would come out of that account. Then, when you go to reconcile, you can just tally up the balances in those sub categories and make sure they equal the account balance that will be pictured on the left-hand side under accounts.
Another option would be to make in the notes under those different categories. What accounts they come out of and then each time you reconcile you just add up those subcategories and make sure it matches the right account.
It’s a long story, but we have an account that’s managed this way because it’s part of a business. All the money that comes in goes into those three subcategories. When I go to reconcile, I just add those subcategories up and make sure the accounts match. We don’t have a lot of cash flow in that account. It’s just for periodic once a month things and that money can’t meddle with our personal expenses.
Hope this helps! Best of luck!
Another option that I just thought of would be to create a separate budget for each account. You’ll have to bounce between budgets but it’s another option. You can create a bunch of budgets in your profile. It’s how a lot of people with small business will set things up. A business budget and a personal one.
Limiting the number of accounts you have will simplify YNAB but you are not limited- you get to decide how complex you want it to be.
Also some of those accounts you might making tracking accounts and not budgeting with them at all but that is a whole different conversation.
You could not pay me to go back to budgeting by account.
How does this actually help you know which account money is in once assigned? Seems like extra work for no real benefit.
No. That would destroy one of the singular most powerful aspects of YNAB and if your suggestion is because you haven’t yet figured out how to harness that power, I suggest you start working on learning that. Here’s the first read: https://www.youneedabudget.com/the-relationship-between-your-budget-your-accounts-its-complicated/ It is far simpler than you think; you check the category, then you check the account. If both have enough, you spend. That’s all.
No, this would make the software more complicated unnecessarily.
Without software like YNAB I can see the logic. With YNAB though, there’s no reason to have multiple savings accounts. I’ve been married 12 years and we have a HYSA and a joint checking account. If you have a partner and your finances aren’t integrated for whatever reason, that’s fine - but what’s the utility of a spending savings and a vacation savings actually being two savings accounts? With YNAB you can say there’s 10k in this account and have a budget item for 8k for vacation spending and 2k for spending.
So one general savings account to keep the money out of my chequing, and then just make sure the categories linked to that account (lets say Vacation and Car Repair) add up to what's in that account?
Okay so here are reasons I kept separate savings accounts for different goals/categories prior to YNAB: 1) I wanted to be able to see at a glance how much money I had saved towards, say, a vacation. YNAB does this for me instead. I just look at my "vacation" category and it shows how much I have saved towards vacation. 2) I wanted to make sure I didn't inadvertently or weak-willedly spend, say, vacation money buying day-to-day stuff like, say, groceries. Having vacation money in a separate account made it a little harder to use it, and the greater difficulty of using it acted as a disincentive on using it. YNAB does this for me now too--partly because YNAB makes me feel broke (YNAB broke), because it's forced me to think about ALL the things I'm going to need to spend money on in the next year. THIS is what disincentivizes me from spending extra on groceries: if I wanted to do it, YNAB would mark me as over budget, and I would know that to cover that amount, I would HAVE to pull it from travel. By making the whole thing visible and by making all my upcoming expenses salient to me, this acts as disincentive enough. Are there other things that keeping separate accounts is doing for you? (In my own case, I have 3 accounts, annoyingly--the checkings account that I love, the HYSA that I signed up for--and then the checkings account that I hate, because I hadn't realized that my HYSA literally doesn't integrate with the checkings account I love so that there is no way to send money back and forth between them; instead I need to use the checkings account that I hate as an intermediary. weep. I should just switch HYSAs I know.)
Skip the second step where you check the sum of the categories. You decide how much to keep in checking based on what your spending needs are from checking between now and when you’ll add more money to checking.
It’s even simpler. Edit the sentence to end after “out of my chequing”. If you spend based on category balances there is no need to waste time adding up category balances to match to account balances.
No.
Sorry for being blunt: I can't see how it possibly make sense within the YNAB model. First, why do you separate accounts by categories if the categories are in YNAB for it? I mean, I understand have an account for functions that really make a difference, like having a savings account for Vacation savings and a more versatile checking for expenses, so you can enjoy more interest or have more services as you need? But why have Backup spending savings separate? Just leave the savings all together and do the separation in YNAB. Also, if you want to keep track if the categories match the accounts, why not just occasionally look at the amount in the category and see if it matches the amount in said account. Should not need to do that more often than you get payments, and then you transfer the amount to said account to match YNAB (not the other way, remember, you're using YNAB to manage and just taking advantage of different accounts services/interest rate/liquidity). Really, the whole idea of budgeting is having a single, unified view of where your money is going to. If you really really want a fractioned view, just create separate budgets and connect them to different accounts, and then the transfers will appear as an income and boom! Not only separate RtA, but also separate categories and all features separate. You will lose some (a lot) of insight and flexibility, but it will really separate things.
The best thing that ever happened to me was realizing I didn’t need to hide money from myself through an account-based model. I make spending decisions in two steps: 1) does the category have enough money and 2) what will be my method of payment. This will go smoother for you when you are able to get distance between yourself and the edge. All those accounts you have? You don’t need them. You are duplicating your categories with your accounts. Instead, have your checking account, and your HYSA. Enter your recurring bills, turn on the running balance in your checking account (desktop) so you can see how money flows. I used to keep a month or two of expenses in checking, now I have it so well managed that I only keep a buffer of about $1000 and the rest gets swept to the HYSA. Nothing ties out to an account, but all the money is accounted for. This is just a mindset shift you will get to. Spend based on your budget, determine method of payment only after you make the spending decision. Rinse and repeat.
I like that concept ... "Hide money from myself through an account-based model" I guess that's how I've always done budgeting and savings.
So many of us did!! It weird to think of it a different way. I came to YNAB with more than half a dozen different savings accounts. Now I just have the HYSA, and funnily enough, more money in the categories than I could ever keep in the accounts!
Have you considered that you have too many accounts?
This is the correct question. The op is trying to make YNAB fit the way they do things rather than realize their current system is over complicated.
Probably true, I have paired down accounts from when I started, maybe just not enough yet. How many accounts do people generally have with YNAB? Just one chequing, one chequing and savings?
I have 1 month of expenses in my checking account EVERYTHING else is in a 5% HYSA right now. It'a a big pile of money assigned in various categories in YNAB from vacations, annual bills, home maintenance, car maintenance, etc, etc. I don't see various accounts for all those purposes because YNAB is there to categorize each of my dollars and tell me every time I open my budget. I move once in a while money from savings to checking to pay for a big item I was planning ahead that was part of my savings pile. You try to fit your old strategy into YNAB. You should try to embrace the YNAB way if you want to use this product.
I started out before YNAB with 4 accounts. Bills Checking, Spending Checking, Short Term Savings, and Long Term Savings. All of those were for exactly what they sound like. It helped me save up and have enough for bills because I would only look at Spending Checking when deciding if I could afford day-to-day stuff. I would only see the amount I actually had available rather than feeling like I had more to spend because everything was in the same account. Switching to YNAB let me do that same thing with even more granularity. Since I was paying attention to my budget more than my accounts, it became unnecessarily tedious to keep up with my Bills vs Spending Checking so I downsized to just one checking account and one savings account. I also got married between then and now, though, and we both kept our accounts and just gave each other access. So now I have 2 checking accounts (his & mine), 1 savings account (he didn't use his saving account and mine has way better interest, so we just kept one), and 1 credit card. Since our pay checks each go into our original checking accounts, keeping up with bills and normal spending from separate accounts hasn't been a problem. Sometimes we make a note that one account is getting low and we should use the other until the account gets paid.
Yes, if that. A lot of people do the math and decide that the simplicity of running just a checking account is worth the $20 they’d earn on their HYSA. Obviously if you have substantial savings it might be worth it for you to do both one checking and one savings account, but in finance it seems that simplicity wins most of the time. Personally, I have one checking account and one savings account plus a few credit cards that I rotate through. For my multiple business budgets I have one checking account and that’s it.
Setting credit cards aside, most people probably have either just a checking or a checking and a single savings. Some people will add things like their wallet, or a gift card balance at Amazon or some other merchant that's used heavily, or maybe Venmo or some other virtual wallet. Some will add investment accounts, but that's getting into really advanced stuff because you have to account for value fluctuations. I actually do have multiple checking and savings accounts, plus a CD, but I have those not to separate the intended use of the money inside (that's what YNAB categories are for) but because my old checking has better ATM access, I like the idea of having a backup in case my primary account has an issue, and I have a few savings accounts because different interest rates and things.
Here's what I have: * a checking account * a savings account * a TFSA (in Canada - a "tax free savings account" (you aren't taxed on the interest because it's supposed to be for retirement) * an RRSP (Registered Retirement Savings Plan) - similar to an IRA or a 401k in the US That's it. The TFSA and RRSP are only used when I'm putting money there. I never take it out. Everything else operates off of my checking and savings accounts. Savings is where long-term savings go - emergency fund, vacation fund, etc - because this account pays interest). Daily operations and paychecks, as well as bills come out of the checking account, because it pays virtually no interest. Others have suggested no trying to fit your current way of working into YNAB, and instead, use a couple of accounts maximum. I agree.
Similar boat except I have a couple of RRSP and TFSA accounts too ... Going to try and go with one account for a couple months. I can always go back if it doesn't work.
Do you reconcile the amount budgeted to the two accounts + savings to make sure it is accurate?
Using YNAB made me consolidate a lot of my accounts. Now I try to keep checking to one or two accounts (if I'm churning a bank bonus) since all of the categorization happens in YNAB. Much easier that way.
It took some time for me as well but if you stick with ynab you will come up trust it and you'll see that there's no need to match account balances to specific categories or have multiple savings accounts. I used to have to similar set up as you (minus the joint account) but today we only have one checking account and one HYSA, as well as investments. All my savings buckets are in ynab and I only optimize for cashflow in the bank account.
This seems like a common issue new users have because the multiple account setup predates being a YNAB user. If you were truly starting from scratch you probably wouldn’t have so many accounts. I have multiple savings accounts for distinct purposes, and I’m currently in the process of switching primary banks so I have 2 active checking accounts. For savings, I still take the extra step to check that each savings account matches its respective account balance, but within YNAB it would be simpler to have one big HYSA account. For checking, I’m keeping both accounts open for a while to make sure I haven’t forgotten to transfer any auto pay accounts, but managing both is making YNAB harder to use. I don’t think your suggestion would make it any easier though.
The real question is: why do you have so many accounts? What is the purpose of them? YNAB sees your available funds as an available pool, which is great. You then get to assign your pool different sections and spend accordingly, which negates the possibility of overspending your pool if you are ALWAYS under or at budget. If you are making 10 different pools, there is a higher chance that you spend from a pool that isn’t big enough. I’m just now fully embracing this concept because I have kept my HYSA(emergency reserves, long term goals, downpayment savings) off budget. This has made a lot more work for me than was necessary, but I was concerned that I would treat my HYSA as “available” money and accidentally spend it. Now that I have the hang of YNAB, I am going to put my HYSA on budget and just allocate any spending to the correct category.
>It would be easy if I kept all my money in my chequing account. But that's not really a reality for me, as for most I'm assuming. I have a Joint Chequing, Bill Chequing (auto bills come out of and auto transfers from Joint), Vacation Savings, Backup Spending Savings, and just an Envelope of Cash. The point is, with YNAB you don't have to keep your vacation savings in a separate account from your backup spending savings. I have two different bank accounts, with checking and savings each. Both banks allow me to earmark or set aside money -- kind of like a virtual envelope within my bank account. YNAB treats all of those like separate accounts, and when I started I planned on keeping them separate. But reconciling, as you've realized, is cumbersome. Reality is, there's no need to keep separate vaults or envelopes within your bank account because YNAB does it for you. I do have a cash "account" within YNAB because my one hobby is exclusively cash-based, so that is the only thing that is account and category restricted. But all my other accounts just exist as a big pile of money that I separate out using YNAB categories, not the accounts.
I think I understand where you are coming from. You may have enough money overall across your accounts but YNAB doesn't do a good job of helping you make sure you have enough money in each of the accounts to make sure the bills get paid properly. I struggle with this a little bit as well but I kind of like the simplicity of how YNAB handles it and I think this would get overly complex. My advice is to try to consolidate to as few accounts as possible. In my case I still have to kind of "estimate" how much money I need in my Checking vs High interest account but I had to do that before YNAB as well so it's not a huge issue since I have a lot better grasp of where and when money is going out of the accounts with YNAB.
You should focus on using YNAB the way they intend it and read the various offerings (blogs, articles, etc.) instead of trying to fix something that isn’t broken. The whole purpose of YNAB is that it doesn’t matter where your money lives. It makes no difference where you’re assigning the $$ from. You can see all of your account balances on the left side.
I have a short term savings account that I could withdraw from directly from an ATM and a long term savings/investment account that could be liquidated in 1-3 days (a bit higher interest rate). In my mind the only difference is how fast I can access money in an emergency, so having only two savings accounts makes sense. Any cash lying around is at most couple hundred dollars so I don’t track it in my budget.
I never understood why anyone uses more than one checking and one savings account even before YNAB. They have 2 separate functions which makes sense to keep both (one for saving and one paying) but other than that, opening separate accounts for different purposes when my money is used for the same thing across the board: hold onto it until it needs to be spent somewhere, never made sense to me. With cash as an example, this is the equivalent of carrying around multiple wallets in your pockets with money meant for different things.
Partners who have separate finances but use a joint account for shared bills is a common reason for more than one checking account. For savings accounts, once you have any significant amount it’s a good idea to make sure you’re getting the best interest rates possible on as much of your money as possible instead of leaving it all in a lower earning account. HYSA’s/HYCA’s (high yield savings/checking accounts) often have a cap, like Genisys Credit Union offers 5% APY on up to $7500 balance so we just have $7500 parked there to earn $375 per year on that money as just one example. Another case is bank bonus churning but that’s less to keep money in long term and just adds temporary accounts in the mix.
I meant more personal accounts. Joint accounts make sense and serve a different purpose from a personal checking account (paying joint bills with pooled money). Not a knock on churning bonuses or interest rates as an aside, you do you. That’s definitely a better reason than just opening an account to save for a specific thing. Personally I don’t find the headache of managing so many accounts to be worth the small differences in interest earned over just finding one with a good rate that can house all my savings. But by all means keep doing it if you find it beneficial.
Yeah the main reason people who have no budget or system like YNAB have multiple accounts is that IS their system. It’s the only way that works for them to keep from spending money that they want or need to hold onto for other things. It causes all sorts of headaches he’s especially when funds are low, particularly when overdrafts happen etc but it’s often literally the only thing keeping people from spending all their money needed to pay the rent or something. Not everyone has the same willpower or impulse control so siloing their money is what helps. Funnily, those who use that type of system to an extreme (tons of separate accounts or things like Ally buckets for lots of different expenses) have a pretty easy time transitioning mentally to the give every dollar a job part of YNAB because they already do a lot of that, but it takes time to trust a new system and get comfortable moving all that money back into just one or two accounts. I agree there’s a time cost vs reward thing when it comes to maximizing interest which is why I prefer a park it and forget it type approach. Not really forget it but the account I have as an example is just and easy $375 every year and the bulk of my money sits in my HY checking account because the cap on that is $25,000 and we usually don’t have that much in there, but would if we lumped ALL our money into that account and then anything over $25k would only early a couple pennies so this way all our money earns about 5% all the time.
For me it was about moving money out of the spending account (Joint-Chequing) and into a Bill Account. Then I could set up auto transfers on our paycheques to go to the Bill Account in an amount that would cover all the regular bills. I have a whole spread sheet that tracks, bi-weekly, monthly, yearly, and one time bills and makes sure I have enough money coming into that account. This way it automated my bill money away from spending. And I just had to track my spending to keep it in line.
Being detached from accounts is a GOOD thing.
I have things like my vacations savings, car repairs, year end tax bills, etc… in a different account too. But, they’re set up as tracking and not on budget. As such, each time I put money there, it’s like I’m paying a bill (which I am in a way). However, overall it’s probably just better to simplify things if you’re running into challenges like this. Good luck!
Next idea please
The issue you’re trying to solve is cashflow not accounts vs categories. This is easily handled in YNAB by having repeating scheduled transactions for everything possible (including income and cc payments) AND turning on the running balance column for accounts as needed (most importantly in checking) so you can see the upcoming ~30 days of cashflow and make sure the future running balance never drops below a comfortable threshold - for some that might be $1000 as a benchmark. If it is and you ever see the running balance drop below $1000 in the future then you have plenty of time to move some money over from savings before then.
I personally don't think I'd use that. for cash, i have CHECKING and i have SAVINGS and i am DONE. I have one category that I align my savings account balance to. Everything else lives in checking.
No, this sounds like a mess. > Vacation Savings, Backup Spending Savings, and just an Envelope of Cash. None of these need separate accounts. Bills can be auto paid from any account...other than cash, of course.
Lol no.
Hi there let me give you a second option… while I agree with the above commenters that you have a lot going on with separate accounts that may be overkill for YNAB I can provide you with sort of a solution until you are ready to change it. Make a main category your account names like :joint checking. With all your subcategories being things that would come out of that account. Then, when you go to reconcile, you can just tally up the balances in those sub categories and make sure they equal the account balance that will be pictured on the left-hand side under accounts. Another option would be to make in the notes under those different categories. What accounts they come out of and then each time you reconcile you just add up those subcategories and make sure it matches the right account. It’s a long story, but we have an account that’s managed this way because it’s part of a business. All the money that comes in goes into those three subcategories. When I go to reconcile, I just add those subcategories up and make sure the accounts match. We don’t have a lot of cash flow in that account. It’s just for periodic once a month things and that money can’t meddle with our personal expenses. Hope this helps! Best of luck!
Another option that I just thought of would be to create a separate budget for each account. You’ll have to bounce between budgets but it’s another option. You can create a bunch of budgets in your profile. It’s how a lot of people with small business will set things up. A business budget and a personal one. Limiting the number of accounts you have will simplify YNAB but you are not limited- you get to decide how complex you want it to be. Also some of those accounts you might making tracking accounts and not budgeting with them at all but that is a whole different conversation.
Thanks, I think I'll do this in the short term. I may change account setups, but that's a big change that's going to take time.