6 Common YNAB Mistakes You Might Be Making
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- Опубліковано 3 чер 2024
- New is hard. We feel you. If you've had a hard time making YNAB stick in the past, there's a chance you could making one of these common beginner mistakes. Learn about the six common mishaps we see when new users set out on their YNAB journey, and learn how to get back on track!
TIMESTAMPS:
0:00 Intro
0:49 Mistake #1: Adding future paychecks
2:47 Mistake #2: Waiting until the 1st to start
4:23 Mistake #3: Not utilizing credit card account type
6:25 Mistake #4: One catch-all savings category
8:11 Mistake #5: Having too few categories
9:35 Mistake #6: Getting hung up on the perfect plan
11:48 Outro
12:19 Bloopers
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I'm 2 weeks into YNAB and loving it. I've been binge watching these videos like crazy. So helpful! My wife is probably starting to get a little jealous of Hannah at this point.
I did the same thing when I started YNAB and when Hannah replied to one of my comments it was like a brush with a celebrity!
@@melanieshipley3133 Lucky!! I'd definitely react to that as if I was in 6th grade again.
😅 We are the dorky corner of the internet 😂
🌻 Hannah
Fun story - got a call for an unexpected bill on our propane tank lease. I told the kind lady it was no problem because we had the money and I would just move some money around in our budget. Then we got chatting about YNAB and 20 min later she was thanking me so much for telling her about YNAB and she said she was also definitely going to share with her adult children. lol. That’s how great YNAB is in our life and how we share your awesomeness.
Best lesson I learned was to reconcile my accounts every single morning. Takes me about 5 minutes over coffee - a little longer on paydays (playdays!) - and I always know exactly where we are with everything.
The credit card management is my favorite part of YNAB. I couldn’t imagine not using a credit card category.
oh man trying to use a credit card as a "checking account" type would make things way way too difficult for my brain. i love how ccs are handled!
I'm two months in to using YNAB. My thing I learned is sorting the categories by how often I'll need to check them. It makes it so easy to fund all of my monthly bills and then collapse the category.
I had to learn this the hard way because my budget before YNAB was oriented around groups like "necessary for life" and "for fun." That's how I had set up my category groups in YNAB initially, but it quickly got annoying to scroll all the way past all my monthly bills in the same group to check on other things. Now, everything is sorted by how often I'll spend from them, so I can easily check how much I have for groceries or food delivery and quickly roll with the punches from those categories. And I can collapse my "monthly," "yearly," and "occasional" groups to get them out of the way day to day.
Smart!! I put all my most important expenses (like the bills, mortgage, utilities) at the top, and the categories get less and less critical as they go down the budget. BUT, it does make getting down to things like my fun money or our holidays category a total pain 🤣 I like this order though because I'm giving available jobs to the most important jobs of the month first and the least last. But I DEFINITELY have to scroll and search for my categories a lot more than you probably do! 🙃
🌻 Hannah
YNAB is more strict that Ramsey's "Every Dollar" app by not allowing money to be earned that month to be assigned to the budget yet. As the resident household Budget/Finance, I really appreciate this about YNAB. With "Every Dollar" I have to worry about cash flow and making sure I have enough in the bank before I spend. This is not a problem with YNAB, yay, one less thing to worry about!
Biggest mistake I made as a YNAB newbie (Ynoob?) is I ignored a 9 cent discrepancy between my checking balance in YNAB and in my bank because it seemed like “no big deal.” Fast forward six months and it was a $900 discrepancy 😅 RECONCILE PEOPLE!!
OH NOOOOO!! That's no joke! 😂 Glad you eventually got that one ironed out!
🌻 Hannah
YNAB saved my sanity. Went from broke to ballin in a matter of months ❤
When I started YNAB a couple years ago, I binged watched all of Hannah's videos. I love this one yet again for the great info AND the outtakes
😆
🥰🥰🥰 Thank you, Amy!! So sweet!
🌻 Hannah
The thing that bugged me at first was the timing of my paychecks. I had spent a couple years forecasting, but I get paid at the end of every month. So the paycheck I'll get April 30th is going to fund May. But right now, on the income/expense report, it looks like I've had all my expenses but no income, which used to stress me out a bit! Took a little while for me to wrap my head around that and realize I didn't have to fudge any dates, because the YNAB plan isn't really by month.
The True Expenses thing was a real mind-bender/game-changer, though. When I was doing cash flow forecasting, or planning on a spreadsheet, I didn't have any concept of saving up for much of anything (also didn't have hardly any money to save, but that's another story), but now I have a ton of things I'm saving up for. So much easier to set aside ten-twelve bucks every month and then have cash on hand to renew my Amazon Prime when it comes due. But yeah, it was weird at first.
Also, yes, the credit card categories are brilliant. I have my cards set to automatically pay the full statement balance every month, and I know I'll always be able to cover those payments. So comforting.
I don't use the auto import because it is too inconsistent in frequency, so I manually import qfx files, which makes me happy. Took me a year to realize you can have it automatically assign categories based on text contained in the payee. Now I have to go and fix all my payee accounts (at least 1000). I wish the "payee manager" was more powerful.
I do use auto import because my bank is incredibly quick. It’s really solid, after the rigmarole of trying to get it set up. I’m so grateful for it because it’s helped me adjust a few things before it became a disaster! I think it really depends on your bank
The credit card/checking folks drive me nutty. They were confused with the credit card function and went back to the “old” way of managing their credit card. They also encourage new users to do the same thing even though they haven’t tried using credit card categories in YNAB in the last 3 years. To me, credit cards are the easiest function in YNAB.
SAME. They're a no brainer. So easy, and I haven't had a late fee or been ill-prepared for a credit card bill EVER. One of my very favorite parts of YNAB, too!
🌻 Hannah
YNAB has been a pretty big mind shift, but probably for the better in the long run.
Couple of the things I ran into:
1. Learning how to transfer money from one account to another, eg for savings or credit card payment.
2. Create a cash account, otherwise money withdrawal from an ATM just disappears 💸
Hospitality!! That's the category I have been missing. Was just trying to think up a name for such a category for stuff that's not necessarily donations or charity, but meals or supplies, serving others. Thanks Hannah!
SAME! Immediately added it to my "consumables" heading.
@@hollergoblin363 added it to my Interests category with a pineapple emoji 🍍
I tend to lump mine in with gifts but I am now contemplating that decision. 🤔
@@reginadrake-parguey6726 I usually lumped mine under a generic Donations category under Giving group
one of my fav tidbits in this vid!
I love Hannah videos. They are my favourite YNAB videos
🥰🥰🥰
🌻 Hannah
Something I wish I hadn't done was completely delete my earlier budgets when I wanted to start over organizing. After I'd categorized a couple years' worth of purchases, it would have made things like finding all my 1099 expenses WAY easier for taxes if I hadn't gone scorched earth 😭 We love a refresh, but maybe don't purposefully delete all your data??
‘scorched earth’ 😂 So true!
Ahh, that's a good tip!! Fresh Starts are SO clutch for being able to preserve all that old information while moving forward with a brand new budget + same template.
🌻 Hannah
Very true. YNAB export at tax time is a Game. Changer. !!!
The biggest challenge my wife had was trying to reconcile the budget to the bank accounts.
It took quite some effort the help her wrap her head around the budget not caring about actual accounts or where the money is stored. The $$ in groceries category is irrelevant to where the $$ reside, it’s just that the $$ are there
I feel like once you do wrap your head around this, it makes some other things clearer, like you could maybe keep most of your cash in a high-yield savings account most of the time (if you use credit cards for daily purchases) earning interest instead of sitting "on deck" in a debit account earning no interest.
I had this challenge too. One day I needed to do a budget audit because there was an error I could not find. In doing the audit, everything finally clicked into place; the math made sense. And I had been using YNAB for over 10 years at that point!
once or twice a month I make sure what I have budgeted matches my account balances; it gives me peace of mind.
Enjoyed as usual! Would really love to see a video on reconciling YNAB with itself. Balancing the account side with the budget side. I had to do a fresh start last year because I didn't think through how to do this and lost confidence in my budget. I now balance both sides every month. Also, a balancing report would be real handy. Thanks. -Ed
The "savings lump" was the one that took me the longest to work out (my first 2.5 years of YNAB!). But I was really grateful for the push to think about my future and how to prepare for it. Thanks, YNAB!
There is one part of the YNAB screen capture where the gmail address isn't blurred out. Just a heads up!
You’re the best Hannah! Thank you always!
I love these videos! Keep going! The only thing which is better than the app, is your ynab method :3
Oh, it's ALLLL about the method forever and always!!
🌻 Hannah
First off, I love your videos Hannah! I have been using YNAB for a couple years now but admit that I am one of those people who have always lumped my checking & credit card entries together. I found it difficult to reconcile these 2 accounts. (imagine that!) After watching this video and then the one “Using Credit Cards with YNAB: The Complete Guide”, I thought I would try doing it the “right way” and setup a credit card account. My checking account automatically pays off my credit card every month (yay!) so I set it up with that in mind. It is fun to use more of the features of the software so hopefully it will all work out well.
These insights are spot-on! Managing finances effectively is all about being proactive and avoiding common pitfalls like budgeting future income or waiting for specific dates. It's crucial to break down savings into specific categories for better financial clarity.
Thanks for this wonderful video! I had the hardest time with money transfers between my different cash accounts and properly recording those transfers in my transactions. After transferring money, I always had to reconcile my accounts to make sure I did it right.
It took me a hot minute to figure out transfers in the beginning too, but they're actually os simple! Just swap the payee for a transfer and DONEZO.
🌻 Hannah
The credit card functionality is absolute genius, just takes a little getting used to. No more mental math. I just record my transactions knowing YNAB keeps track of the credit card payment - every couple weeks or so I make the payment YNAB says and bingo, never lose track or run a balance. My brain thanks you for lightening the mental load.
Also after a year of YNAB I simplified my bank accounts (one checking and one savings, two credit cards - closed all the rest) and started a new budget so I wouldn’t have to see the old mess. 🎉 🥂
I... LOVE the credit card system in YNAB. Never been so worry-free about using a credit card in my life. And way to go on simplifying! I think that feels so weird or almost wrong to people, but you truly don't need all those accounts with YNAB-it's the spending plan that does all the money organization and allocation for you!
🌻 Hannah
Great video, Hannah!! I second the “too few” categories problem! At one point I tried implementing the Ramit Sethi 4 categories system, starting with actually 7 I think for insurance, trips, and gifts to be separated out. I kept having to add more in because it was too confusing, I’m right back where I started now, with possibly more categories honestly 😂
I love the granularity of having a category for EVERYTHING! The more we build out our budget, the less we've had to use our "miscellaneous" category, and for the first time ever we haven't been overspending it every month! And it makes building up our money and saving more without even realizing it SO much easier!!
🌻 Hannah
I've been with YNAB for nearly a year and it has been a financial lifesaver! And I have an uber-detailed plan! Five categories under Auto alone! 😁
YAY!! Sounds like you are CRUSHING it. Isn't it amazing how much faster the savings racks up when you give every dollar a job?! That was always the mind-blower for me.
🌻 Hannah
12:02. What did I learn over time? I learned to listen to Hannah! She knows what's best for me (YNAB-wise) :)
Last year I decided my budget was a little stale so I simply started a new one from scratch, only using my old budget as a reference for the fixed/recurring expenses. Was surprised at how it didn’t take long to be up to speed in the new budget & how refreshing it was to be making new categories that match where I am now in life.
Felt so good I’m considering doing it again, 1yr on! Let your budget evolve folks, and don’t be afraid to start over (-8
The CC issue (interest/fees) is the most confusing. I can't remember who in your Help department finally helped me, but since I no longer use the cards, just paying them off, I can set them up as Tracking accounts. And yes, that's more simple, but every month I still want to have my Credit Card Accounts with an Interest category. I've only been doing this a few months, so hopefully after I've mastered everything else 🤣 I can go back to using the Credit Card Accounts. If you have time, would you be able to give me some hints in order to make it a little more understandable? I've watched the videos and read the blog posts, but I just feel too dense to absorb the concept.
Is it strange that you are my favorite youtuber? 😅
In other news, that was a great video especially the advice at the end.
I was that person that had a random category called “personal emergency” with $10k sitting in it. I already had categories for various deductibles and home repairs so I moved some of the money to finish my new house fund and the rest to new car. I finally realized that if my life implodes, we probably won’t be doing either of those things so I’ll have some cash lol
I recently had a similar experience! I was STRESSING about how much to pay toward my credit card debt vs. saving up an emergency fund, but I'm also saving up for a vacation. Should something happen to my job, I just won't take the vacation and keep that money for other things. Really freed up my decision paralysis!
YES. Having the plan fleshed out gives everything so much more security, but even then the plan is SO FLEXIBLE. Once the tree falls in on the roof, suddenly the goal of the new car becomes so much lower priority, and you're totally willing to take a little from that new car toward fixing the gaping hole in your roof. But in the meantime, having all those little nest eggs for all those possibilities is SO AMAZING and makes me feel so much safer.
🌻 Hannah
As a Parks and Rec fan, I appreciate the "Food n Stuff" easter egg. 😂
🥰🙃🥩
🌻 Hannah
I’ve been a Ynabber for a few years and still struggle with how the credit card works in the system.
love YNAB… Hannah’s outros give Jenny Slate vibes and I’m here for it
FLATTERED. Thank you 🥰
🌻 Hannah
Please make a video about the new changes to targets in 2024! I'm so confused!
Oh, I'm all over it my friend!
🌻 Hannah
I’d like to see a video explaining the difference between assigned and available. It’s not intuitive enough.
You're funny Hannah. Quirky some might say but entertaining none the less. Keep em coming. BTW: It took 41M bricks. lol
🙃 Gladly!
🌻 Hannah
The savings categories and the credit card stuff is mind-boggling to me still. I quit YNAB multiple times over it. I understand the logic behind it. However, I don’t fully understand the mechanics of it. Still. 😂
idk why YNAB doesn’t push hard on the “envelope method” language because that is exactly what the software is.
When you have cash and envelopes you save by having a savings envelope and moving cash into it
Similarly you have an envelope for your credit card, and when you buy anything on the card you move cash into the envelope. Then when the payment is due you mail the cash in the envelope to the credit card company.
Hope this helps
Subscriptions is a headache for me -- any new features for it?
What kind of feature would you want for it? You can already set up recurring transactions
Any new videos due Hannah? I'm a couple months in and have binged all the HFHs, including ones on tax refunds (which i don't receive), renovations (which I'll never do) and babies (had those 30+ years ago). I've enjoyed them all - the videos not the babies, tho they were pretty cool too, but now I'll have to start at the beginning again while I wait for another one. Again, videos not ...
Ha!! AMAZING! I love that, thank you so much for sharing that 😂🥰 New HIFH videos come out every other Thursday! Last week was just a UA-cam Short in place of a longform video, so it was a bit of a "down" week. A few new videos coming on some awesome little updates that you won't want to miss in the next month!
🌻 Hannah
Biggest mistake I made was not understanding how important reconciling is or what it even meant exactly. I had to do like 14 for starts before I figured out the problem and solution 😂
OH NO. Reconciling can seem like a pain for some reason, but all it really is is tidying up and making sure everything accurate and in the right place. It can definitely save a backed up spending plan!
🌻 Hannah
I'm really struggling with the savings one. I don't really know what I'm putting money aside for, just that I should be doing it. I budget for it, it goes into my savings account at the end of the month and I just don't think about it otherwise. What am I supposed to do with it? 😂
Brainstorm! Maybe grab a piece of paper. Are there any "down the road" things you'd like to have money for? Vacation, pet boarding, home renovations, a new car, new tech. Any emergencies you'd like to be prepared for? Home emergencies, car repairs, medical savings. You can also "build your savings" by just budgeting further and further into the future! Currently my husband and I have the months of June and July fully funded, despite it being May! So if either or both of us lost our incomes, we know we still have two whole months where every expense (even the frivolous ones) are fully funded. Pretty cool!
🌻 Hannah
How can I display these emojis?
Emoji tutorial, coming right up!
ua-cam.com/video/0rb4j-mmKwg/v-deo.html
🌻 Hannah
Okay, but when I started in the middle of the month it actually was a little awkward to have my targets that I had already met and paid before I started YNAB look at me with their sad yellow colors... 😢 😉
You can "snooze" them for that month, I just noticed this today! Not sure how new the toggle is, but it's in there when you're editing a Target!
Yes to @hbirdy711! You can bypass any target for the month by toggling on the "snooze" feature. It's a relatively new feature, came out about 5 months ago!
🌻 Hannah
Yeah if I had to start over with YNAB in the middle of the month, I'd put all the targets on the next month and just leave the current month without them.
I just started 1 week ago. I ended up snoozing any target that had already been paid for month and funding the things that hadn’t already been paid. Then I stating funding the early-in-the-month categories for next month.
I learned to reconcile at least a few times a week, otherwise it's two weeks later and a confusing disaster 😅
Agreed! I always feel like the more often, the better. Less work, less worry!
🌻 Hannah
Instead of too few categories, TOO MANY categories right off the bat from starting my journey with YNAB!! LOL 🤣🤣
I saw in some other YNAB official videos that 50 categories is normal
I have 64 at the moment and feeling happy with it
7th common mistake: Not having a fully funded category for Disc Golf!
😂 Guilty!
My husband immediately said, "That is correct."
🌻 Hannah
Um, Hannah, you're amazing. That's all. As you were.
🥺🥰 You are too kind!! Thank you!!
🌻 Hannah
Disagree on #3. When I can pay my cc balance anytime due to high bank account balance, it makes no difference which method to use. I tested both for a while and couldn’t find a single difference either way
credit cards are such a PITA in ynab. i switched all mine off because it always was a bigger hassle than it was worth
I feel like im the only one who understands this app, and i am also messing up
I’m that guy who uses the checking account type instead of the Credit Card account type. Way easier to manage as long as you aren’t in debt.
Wow! That's crazy! Do you move money you spent with a credit card to another category? Or do you know that you bank account balances in YNAB won't be accurate until the card is paid? That blows my mind!
🌻 Hannah
@@YNABofficial my bank balances are all always correct and my CC balance is always correct then when I pay my credit card it’s just a transfer between two accounts in Ynab. My CCs are all set up to autopay the full statement amount each month.
It’s easier for me than having an “extra” category for each credit card denoting a future payment.
Thoughts?
@@YNABofficialHannah, the bank account balance is irrelevant. It is always reconciled and matches the reality. Same for CC negative balance. When spending money from CC the category (say groceries) gets reduced and is gone (not moved to any CC category) by the spending amount and the CC balance (red number) increases (again, matching the reality). Now we (the high net worth people) can pay off that red balance at any point of the day in full, so we really don’t need a CC category. That is the way YNAB4 used to work before (unless you were bringing in old debt to YNAB4, it would create a category for that old cc debt only till you pay it off)
@@YNABofficial I wrote a reply to this but don’t see it now. But my balances are always correct in YNAB and no weird extra CC categories. I’d be happy to show you sometime how it works.
Hard disagree, the way YNAB handles credit card categories is the easiest way by far to manage CC purchases, even if you don't carry a balance. But whatever works for you.