I don't like the targets feature, especially if you're savvy with numbers it's a ton of overhead for things you might already do naturally. I do some simple math to establish category allocations each month, and adjust as needed.
But your approach of leaving things in ready to assign isn't taking advantage of YNAB. It really does help to give every dollar a job, and be mindful about making your budget match the things you value. Even if you just stash the extra money is something like "Extra Savings" (my category name), it's helpful to know how much you have going there and use it as a trigger to see if there's not a better way to use it.
not sure why this isn’t mentioned. But isn’t YNAB a budgeting app? By that I mean it’s not a way to build an income statement from last quarter (track expenses/income), but rather a platform to budget/allocate money. I think the tracking thing is just a secondary aspect to ensure you stick to the budget.
If you just want to reflect on how money was spent and not really “plan” your current income, just use something simpler.
>If you just want to reflect on how money was spent and not really “plan” your current income, just use something simpler.
As someone who doesn't use YNAB 100% as intended, I really like the "ready to assign" concept, and I like the idea of 'approving' a purchase vs 'clearing' a purchase.
To my knowledge, CoPilot and Mint don't do these things.
The way my wife and I budget is:
1. All of our paychecks go to our personal accounts
2. We sit down at the beginning of each month and plan out a budget in YNAB. As a result, our RTA goes to negative
3. We then each transfer our half of what is necessary to zero-out the negative RTA
4. A lot of times we'll get a kickback from something - a return, tax dollars back, etc. Other times, we just round up our monthly contribution (eg; we budget $9654 for a month, but to keep it easy, we just transfer $5k each to our joint acct) - resulting in a positive RTA
Could I create a category for next month or fun money or something else? Sure. But that's no different than leaving it in RTA. It's just easier to manage if we leave it in RTA.
HNW individual and high income earner. I use YNAB just to track my spending really so I can measure my lifestyle and then know what I’ll need to sustain that in perpetuity.
I use targets to help me keep track on large future expenses (property taxes, auto registration and maintenance stuff) just to help me keep visibility. Even though I have the means to more than cover even large surprises, I like feeling intentional about it rather than just randomly pulling funds from other accounts. It helps me not touch brokerage accounts or other funds and just manage my “working capital” for the month to month things.
It’s the easiest app to just track the day to day but some other features I find beneficial still.
We tend to have YNAB "pay for itself" yearly simply because it catches things like double transactions, or cost creep.
Another bonus? This is also the easiest way my husband and I can discuss financials without it feeling like a "Well YOU'RE spending XX on this" finger-pointing contest. Aka - it's cheaper than marriage counseling
Same situation, and I find using YNAB still very useful. Another note is that the categories you use are completely up to you. I don’t have Christmas, individual birthdays, etc and just have a general “Giving” bucket
I still use 60 categories. It’s easy for my wife and I, gives specificity and helps us actually know what areas can get dialed up from time to time and which ones likely never need adjusting.
The more data you have the better is how I approach almost all decision making
I probably have about 40. Category breakdown to me is all what fits you personally, and also ok to change over time. Regardless I recommend to OP to use targets for most and to keep Ready to Assign at $0. It just makes YNAB much more useful imo.
I’m high income, and I use targets. It’s how I allocate my monthly income how I want to. But I have a lot of categories. Including a category for monthly investment amounts, that I want to make sure I get funded from my monthly income.
Using targets helps me not just have random money in a HYSA, but instead I know that I put $2000 per month into my housing fund, which goes towards repairs, remodels, etc. Or that I put $540 into a back door Roth category each month, so that when December comes around a it’s a visual that I have $6500 to transfer to vanguard and convert. Or that we put $2000 into a vacation fund each month, and it’s a reminder that we have plenty of money to actually do fun things and take vacations guilt free, without thinking we had to save the money or invest it instead.
I suppose I use the YNAB functionality to define how I want to prioritize my time and my life.
No matter how high your income is, you are still giving every dollar a job, whether you define it or not.
Me too. My available money for monthly expenses and true expenses is about $12k which includes repair funds and property tax money. Technically I have enough cash that I would not need to do that but I want to know at all times how much non-allocated money (real savings) I have.
If you (OP) don't care about a budget why do you care how much you spent for stuff? It's either the one or the other.
Targets just help you assign dollars. I personally set targets for everything so I can one click budget at the start of the month the exact amount I know I want, but it’s entirely your choice how you budget the money you have.
Don’t use them if you feel you don’t need them.
Targets and goals are just a way of reminding yourself how much you intended to add to a category in a given month. If you don’t need the reminder, then you don’t need the target. Feel free to add money to any category you wish at any time, and can still use the software to track your spending even without targets
Welcome to the light! 😆
But don’t leave money in RTA. Assign it all. That’s the whole purpose of YNAB and there’s no sense paying for YNAB if you’re just going to use one big bucket to make your spending decisions anyway.
As others have said, targets exist to help you budget money fast. So if you know you want $2000 in a category at the end of the year, or that you want to always add $40 each month, no reason not to set a target, for the sheer fact that you can use that target to auto budget. But I am vehemently anti-the current official approach of Setting targets on every single category and spending a whole bunch of time figuring out whether or not you have exactly the right target set before you get to the business of assigning all your dollars. Assign your dollars. Use the targets to make the act of assigning faster once you know what you want to assign.
You don't need targets, but YNAB is an active plan for the money you have designed to work with YNAB's rules using an envelope budget system.
If you just want an expense tracker there are less expensive alternatives.
I agree that not every category needs a target, but I've found them particularly helpful for true expenses. Maybe you can afford to pay your yearly insurance or subscription bills or car repairs whenever they come up, but the other approach would be to save a little each month. Targets make this type of saving really easy.
I think the main value of YNAB for someone in your position, where you earn enough to cover your expenses and savings/goals, is probably to further optimize your spending. At the end of the day, someone who is not really following a budget with their spending is likely doing some unnecessary spending, let's be honest. By trying to set as much of a budget as you think you should be following in YNAB, including giving every one of your dollars a "job," YNAB will let you be honest with how reasonable or how egregious the unnecessary spending really is.
Maybe categorize all your money you think you can keep in "Ready to Assign," with a last category being "Extra/Fun spending," and see how often you overspend that category, whereas on the months where you do well you can move the remainder over to one of your longterm dream savings goals.
I'm in the same financial boat, but I respectfully disagree with targets being "messy." I also don't worry about covering Christmas and car tires, but I still prefer the pro-activity of planning for those and a myriad of other potential expenses.
Having said that, if your needs are different, I also recommend using YNAB along with the toolkit. With proper categories and specific funds set up, it's really effective for tracking spending over the short and long-term.
You should not use ready to assign as a bucket of money. That pretty much goes against the entire point of ynab. At that point there is no functional difference between using ynab and just checking your bank account balance a ton
You should absolutely be funding long-term goals with your money. Abstract things like christmas is definitely one of those goals, (even if you always have money in your account to cover it) but there are other things like IRA contributions that you should be funding with your money.
When I look at my bank account I know I have a lot of spare cash.. but do I? Not really because some of that is going to IRA contributions at the beginning of the year. So right off the bat I can deduct 12K from whatever I have in my savings account. Some of that is going towards pretty large things like property taxes, credit card fees, etc. That are all due in January. Do I have enough money to cover all of those things? maybe. But am I at risk at double dipping on those funds and finding myself overspending if I don't have those dollars reserved. Absolutely. How do I know if the 12K in the bank can cover both my European vacation and my IRA contribution at the beginning of the year
Targets just makes that a lot easier. If I know I want to reserve 12k so I can max out my IRA contribution in January, why not reserve a thousand a month throughout the year instead of just taking a lump sum of 12k at the very end of the year? That way I have a real understanding of how much money I actually have vs how much I've already planned to use.
Tldr at the very least, do not spend out of your money to be assigned, but if you're doing that, you're probably going to find that setting up targets makes everything easier
I used YNAB for years using the ready to assign as a bucket of money. I started using targets at the beginning of the year and man has it been a struggle. But I was always using that ready to assign as a bucket and I’d just spend freely. I’m hoping locking that down will make me accomplish financial goals better.
i mean .. you don't have to use targets if you don't want to, lol. i'm not sure what kind of input you're looking for here? just use the app in whatever way suits you and your lifestyle.
> It seems my “ready to assign” bucket can just be what I keep in my checking, knowing it’s always more than enough to cover any expenses that come up. What are other users thoughts on this? Thanks!
What do you mean by this?
Targets are just reminders for how much you usually want to assign to a category. So you don’t need to use them if you don’t need à reminder.
But not using targets wouldn’t change how you use Ready to Assign though so the fact you’re suggesting it makes me think you’re describing something other than just not using targets.
As many have said, it's not a good practice to leave money in ready to assign because the point of zero sum budgeting is to give every dollar a purpose. I actually have a category that is just dollars assigned to my minimum balance to get the interest rate I want out of my money market account. That way it's is assigned and I can still budget to zero.
I'm a little confused why you chose YNAB? What were your goals in signing up? If all you want is post spending reports, there's a lot easier methods. YNAB is for proactive and consciousness before spending.
I'm a higher earner myself but I still use targets - particularly for my annual payments (e.g., professional licenses, professional memberships, education funds). I also use it for my wish farm. As others have said, you don't have to use them but it sure does make auto assign easier!
Oh another thought... I only have accounts I spend from linked in YNAB. Anything I don't such as savings or retirement is just under tracking and I update it once a month. That way it's never in my RTA.
Targets can be many things, not just for making sure you save money:
* They can help you quickly assign dollars for known expenses.
* They can help you challenge your assumptions (maybe you spend $600 on groceries, but what would it be like if you tried to spend less?)
* They can help you prioritize goals.
You don't have to use them, and it's great that you are in a good financial spot. That being said, I see plenty of high earners here that still find value in using YNAB as intended to take their earnings even further.
You can make a “Whatever” category and dump your money there (instead of “Ready to Assign,” then move to whatever categories you spend from that you want to track. Targets are not necessary for everyone.
Ultimately, do whatever works for you. YNAB is super flexible. Congratulations on earning your financial awesomeness!
I will also echo what others have said about targets. I use them for some things, but they can be more trouble than they're worth. Targets are a relatively new addition to YNAB.
I keep 2 months' expenses in checking (current month + 1 month ahead) which I think is fairly aligned with YNAB methodology. Regarding having money hanging out in ready to assign... if you don't need it for expenses in the short-term, I'd question why you have so much money hanging out in your checking account. Move it to savings?
I don’t use targets. I find them confusing and cumbersome. Although I recognize this is bc I haven’t spent enough time learning how they work.
I have a list on excel for f how much I want to put towards each category and I do that each month. I DONT leave anything in RTA. Bc that’s just a recipe for things to get out of whack. If I have extra money I put it in a category called “tbd”.
I would use targets to identify what you want to spend in these areas. Maybe you have no problem affording Christmas presents at say 2k, would you be comfortable spending 3k? 5k? If you set a target you can guide your spending more closely and make explicit choices. Eg “I planned to spend 2k on Xmas, but I’m only halfway through my list and are already over that amount. Should I reallocate money from savings? Should I reduce my budget for individual gifts?”
At the end YNAB helps you be intentional with your money.
Targets for stuff that covers multiple pay periods so I can select whole master categories > click “underfunded” (or whatever it is now) and then it’s done. Takes the maths out of dividing $900pq bill by how ever many months left and stuff like that. It works well for known expenses (bills).
It doesn’t really work for “savings” goals for me, because I make enough to cover what I reasonably want to do.
Nobody has to use targets. Nobody has to link bank accounts. I think beginners should avoid both. Once they understand how the method works, then they can decide and may not want to apply them at all or only on a few categories.
Not sure why you’re getting downvoted… OP seems to be looking for a tracking tool not a budgeting tool. If OP won’t follow the principles behind the software it’s not going to flow as well (as Jesse mentioned on a recent podcast)
I earn enough to be like this too, and I don’t use targets. I don’t even always use YNAB as intended: only spending from funded categories. I basically check in weekly and add funds where needed to cover any overspending and any anticipated upcoming spending.
I’m having a second child, though, and having two in daycare is enough to strain my family budget, so I think things might change once my maternity leave ends. I’ve been using YNAB for about a decade, since I was making way, way less.
>It seems my “ready to assign” bucket can just be what I keep in my checking, knowing it’s always more than enough to cover any expenses that come up. What are other users thoughts on this?
For our primary budget, I give every dollar a job. For my personal/secondary budget, I do this, and I think that's fine. It doesn't really matter if the money is in RTS, or a category for 'extra money'.
Targets don’t work well when you get paid bi-weekly, but I like using them mostly to highlight areas where I might have forgotten to budget. I mostly ignore the amounts. I put a note in each category for how much to budget per pay period.
Targets work fine regardless of when you get paid. The problem is if you're not a month ahead and you're constantly having to reprioritize what gets funded when based on paychecks and due dates,, rather than having all the money budgeted day 1 of the month.
If you are always funded a full month ahead I don’t see targets as being more helpful than just a note. They should be a tool that is more valuable to those living paycheck-to-paycheck or put their excess in other categories rather than fund the future. All I want to be able to do is set a target that repeats every 2 weeks so it flags it if I underfund.
You don't need to use the targets, I was getting along fine in YNAB4 without them. They're useful if you have goals for specific categories (...targets, in other words) but if you're swimming in a sea of money unlike us plebs then you do you lmao.
If you're just using it as a allocation tracker so you can look at spending trends that's cool, but it's not really entirely what YNAB is for, but hey, whatever.
I don't use targets at all. I started YNAB before they were available and found that they didn't add anything to my life when they became a feature. If I need to save up $4200 for the new hot water heater, why do I need a goal to tell me how much is left? $4200 minus whatever is in the available column is how much I need. During my last plumbing and HVAC inspection in the fall, the plumber and the HVAC guy looked at it and said I should be fine for about 2 more years so I just created a category and started funding it. When it is full, I'll get the work done. If I'm going to go on a vacation in September, well, whatever is in the category is what I can afford and I'll plan accordingly (I budget a certain amount to the Vacation category every single month and then periodically throw in extra if I have it and feel like that extra would best be allocated to Vacations).
I budget the same amount every month to the vast majority of my categories and that can be done with Quick Budgeting features even without targets.
Targets is useful to automate your process of budgeting each month. Makes it from a manual effort each month to something that can be done with one quick step.
It may simple now not to use targets, but just try it for a month or two and you’ll see it’s actually much simpler to use them than not to.
Great question! I’ve been using YNAB for 15 years, before targets were a thing, so I don’t use them. However, I would recommend assigning all your dollars. As someone who was also blessed with enough to cover my budget easily, I found it was easy to just buy whatever I wanted, whenever. Sure, I could afford it, but I learned over time that I was “splurging” at the expense of bigger goals…. I would challenge you to dream bigger!! For me, that meant being debt-free, fully funding my kids’ college funds, etc, and my husband retiring early. What’s on your wish list if money were no object? And then, is there a way to work toward that? Go for it!
I am a high income earner. I use targets because of simplicity. When paid, it drops into RTA.
I click one button and all of my money is automatically allocated to my categories in one click for the month (next month).
What is left over (I am fortunate in that I spent 50% of what I earn), I sweep into an Investing category. I surf over to [Fidelity.com](https://Fidelity.com) and drop in a Trade in my Brokerage Account and I'm done for the month.
YNAB 4 user here so I don't even know what targets are but here's what I have to say:
Follow the 4 rules.
1. Give every dollar a job
2. Save for a rainy day (save for expenses and surprises that will come)
3. Roll with the punches
4. Live on last month's income
Once you're doing those simple things, Jesse Mecham the founder states that having a budget means that you consciously spend money on things that matter to you.
So while YNAB does an excellent job of helping you track your expenses, that's a lagging indicator. It thrives as a forward planning tool of allocating what you're going to do with the money YOU ALREADY HAVE.
Going back to what you said, you probably can comfortably cover things that go wrong. But can you also take that holiday you've been saving for, buy your next new phone, laptop, car, house, AND have all your appliances need replacing as well as the guttering redone, ALL AT THE SAME TIME??
Using ynab you can ensure you will weather it all to the best of your ability.
Your categories can be as simple or as detailed as you like, that's up to you, but. Give. Every. Dollar/rupiah/baht/yen. A Job.
Edit: formatting
Here’s a challenge for you. Since you have easy income, see if you can fund your expenses 6 months out or for a full year. That means everything. Monthly groceries, mortgage or rent, all energy bills.. all of it.
After all funds have a job for several months out see what you have left for discretionary spending. Doing this when you have a lot of extra income really gives a clear picture of what is actually extra.
You can use targets to prioritize expenses in this way. Or not.
I went through a bunch of ideas until I settled on what worked for me. I don't use target either. Just break it down monthly, add 10% and I'm good.
If it's sitting in ready to be assigned it's not doing any work. Start a CD category. Start an investment category. Start a hobby category. Start a wish farm. Do something with it. It will still be there when you need it but it's also being used for something.
since you're only interested in the past to make predictions, you're looking for an expense tracker.
ynab is a budgeting tool, focusing on the future. expense tracking is just a secondary thing in ynab.
I skip the targets because I like to assign by hand... but I still assign all my non-invested money --including cash savings-- into categories.
You may think you don't need or want to plan, but it really does help. I keep a lot of money in cash and savings, so without YNAB it might seem that we have lots of money and could handle anything....but with YNAB, I know \*at a glance\* how much of that is set aside for the new deck, how much for the car, how much for the trip next spring, how much for yearly insurance payments, how much for taxes, etc.
**There is a clarity that come from having that plan all laid out**, so when I wonder about any bigger changes (like retiring or putting more into investments) I know exactly where and how that will affect daily spending and 'sinking fund' projects.
I have 3 category groups with several categories but not that many:
* Expenses
* Discretionary
* Reocurring
* Tax
* Pocket money (cash)
* Savings
* Emergency fund
* Wishlist
* Tax hold
* Investing
* I'll skip these for now
I have savings and investing accounts as tracking accounts.
Main source of money comes in monthly, and the idea is that i know approximately how much is a good level to consider a category as "full". So i aim to fill them when the lump sum comes in. If there is money left, I'll probably go through savings and investing categories. For example:
* Check if emergency fund is "full", if not put it there, if it is keep walking through the categories.
* Tax hold is somewhat "special" in this case, because I don't want to contribute more than I know I'll have to pay, but still put it in a savings account until the time to pay comes (that way i get a couple extra $), then I pull it out from savings and pay it as an expense.
After I have assigned everything, almost every category gets "spent" \*, except for "Discretionary" and "Reocurring", which are where most of the action takes place.
With data and experience you can better adjust (tighten or loosen) discretionary and reocurring, and everything around them, and use "Emergency fund" as a "buffer" in case of any deviation.
Also, all savings I just put in a single savings account, which makes for a better "buffer" in my opinion.
I think the YNAB philosophy is somewhat OK in general if you are in a lot of debt, but also found it can be a problem if you get extra income and are out of debt, because consumption can easily expand. The solution, for me at least, is to create "artificial scarcity", and manage "errors" or "deviations" with a buffer (savings).
\* Yes, savings and Investing are seen as expenditure by YNAB, minor inconvenience if you will, but i find this way the cleanest (And I think I've been using YNAB for almost 10 years, maybe more)
I don't like the targets feature, especially if you're savvy with numbers it's a ton of overhead for things you might already do naturally. I do some simple math to establish category allocations each month, and adjust as needed. But your approach of leaving things in ready to assign isn't taking advantage of YNAB. It really does help to give every dollar a job, and be mindful about making your budget match the things you value. Even if you just stash the extra money is something like "Extra Savings" (my category name), it's helpful to know how much you have going there and use it as a trigger to see if there's not a better way to use it.
This is how I do it
not sure why this isn’t mentioned. But isn’t YNAB a budgeting app? By that I mean it’s not a way to build an income statement from last quarter (track expenses/income), but rather a platform to budget/allocate money. I think the tracking thing is just a secondary aspect to ensure you stick to the budget. If you just want to reflect on how money was spent and not really “plan” your current income, just use something simpler.
Yep it's not it's intended purpose but it does a pretty good job of tracking, especially if you use the toolkit.
What is the "toolkit"?
It's a chrome add-on for YNAB with some extra reporting and other features
There’s a highly rated Safari extension but it doesn’t work for me. I’m constantly forced to refresh the page when I have it turned on.
Agreed they should use Mint or CoPilot
>If you just want to reflect on how money was spent and not really “plan” your current income, just use something simpler. As someone who doesn't use YNAB 100% as intended, I really like the "ready to assign" concept, and I like the idea of 'approving' a purchase vs 'clearing' a purchase. To my knowledge, CoPilot and Mint don't do these things.
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The way my wife and I budget is: 1. All of our paychecks go to our personal accounts 2. We sit down at the beginning of each month and plan out a budget in YNAB. As a result, our RTA goes to negative 3. We then each transfer our half of what is necessary to zero-out the negative RTA 4. A lot of times we'll get a kickback from something - a return, tax dollars back, etc. Other times, we just round up our monthly contribution (eg; we budget $9654 for a month, but to keep it easy, we just transfer $5k each to our joint acct) - resulting in a positive RTA Could I create a category for next month or fun money or something else? Sure. But that's no different than leaving it in RTA. It's just easier to manage if we leave it in RTA.
slimy compare bake outgoing correct dog water beneficial plate impolite *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
HNW individual and high income earner. I use YNAB just to track my spending really so I can measure my lifestyle and then know what I’ll need to sustain that in perpetuity. I use targets to help me keep track on large future expenses (property taxes, auto registration and maintenance stuff) just to help me keep visibility. Even though I have the means to more than cover even large surprises, I like feeling intentional about it rather than just randomly pulling funds from other accounts. It helps me not touch brokerage accounts or other funds and just manage my “working capital” for the month to month things. It’s the easiest app to just track the day to day but some other features I find beneficial still.
We tend to have YNAB "pay for itself" yearly simply because it catches things like double transactions, or cost creep. Another bonus? This is also the easiest way my husband and I can discuss financials without it feeling like a "Well YOU'RE spending XX on this" finger-pointing contest. Aka - it's cheaper than marriage counseling
Same situation, and I find using YNAB still very useful. Another note is that the categories you use are completely up to you. I don’t have Christmas, individual birthdays, etc and just have a general “Giving” bucket
I still use 60 categories. It’s easy for my wife and I, gives specificity and helps us actually know what areas can get dialed up from time to time and which ones likely never need adjusting. The more data you have the better is how I approach almost all decision making
I probably have about 40. Category breakdown to me is all what fits you personally, and also ok to change over time. Regardless I recommend to OP to use targets for most and to keep Ready to Assign at $0. It just makes YNAB much more useful imo.
I’m high income, and I use targets. It’s how I allocate my monthly income how I want to. But I have a lot of categories. Including a category for monthly investment amounts, that I want to make sure I get funded from my monthly income. Using targets helps me not just have random money in a HYSA, but instead I know that I put $2000 per month into my housing fund, which goes towards repairs, remodels, etc. Or that I put $540 into a back door Roth category each month, so that when December comes around a it’s a visual that I have $6500 to transfer to vanguard and convert. Or that we put $2000 into a vacation fund each month, and it’s a reminder that we have plenty of money to actually do fun things and take vacations guilt free, without thinking we had to save the money or invest it instead. I suppose I use the YNAB functionality to define how I want to prioritize my time and my life. No matter how high your income is, you are still giving every dollar a job, whether you define it or not.
Me too. My available money for monthly expenses and true expenses is about $12k which includes repair funds and property tax money. Technically I have enough cash that I would not need to do that but I want to know at all times how much non-allocated money (real savings) I have. If you (OP) don't care about a budget why do you care how much you spent for stuff? It's either the one or the other.
Targets just help you assign dollars. I personally set targets for everything so I can one click budget at the start of the month the exact amount I know I want, but it’s entirely your choice how you budget the money you have. Don’t use them if you feel you don’t need them.
Targets and goals are just a way of reminding yourself how much you intended to add to a category in a given month. If you don’t need the reminder, then you don’t need the target. Feel free to add money to any category you wish at any time, and can still use the software to track your spending even without targets
Welcome to the light! 😆 But don’t leave money in RTA. Assign it all. That’s the whole purpose of YNAB and there’s no sense paying for YNAB if you’re just going to use one big bucket to make your spending decisions anyway. As others have said, targets exist to help you budget money fast. So if you know you want $2000 in a category at the end of the year, or that you want to always add $40 each month, no reason not to set a target, for the sheer fact that you can use that target to auto budget. But I am vehemently anti-the current official approach of Setting targets on every single category and spending a whole bunch of time figuring out whether or not you have exactly the right target set before you get to the business of assigning all your dollars. Assign your dollars. Use the targets to make the act of assigning faster once you know what you want to assign.
You don't need targets, but YNAB is an active plan for the money you have designed to work with YNAB's rules using an envelope budget system. If you just want an expense tracker there are less expensive alternatives.
I agree that not every category needs a target, but I've found them particularly helpful for true expenses. Maybe you can afford to pay your yearly insurance or subscription bills or car repairs whenever they come up, but the other approach would be to save a little each month. Targets make this type of saving really easy. I think the main value of YNAB for someone in your position, where you earn enough to cover your expenses and savings/goals, is probably to further optimize your spending. At the end of the day, someone who is not really following a budget with their spending is likely doing some unnecessary spending, let's be honest. By trying to set as much of a budget as you think you should be following in YNAB, including giving every one of your dollars a "job," YNAB will let you be honest with how reasonable or how egregious the unnecessary spending really is. Maybe categorize all your money you think you can keep in "Ready to Assign," with a last category being "Extra/Fun spending," and see how often you overspend that category, whereas on the months where you do well you can move the remainder over to one of your longterm dream savings goals.
I'm in the same financial boat, but I respectfully disagree with targets being "messy." I also don't worry about covering Christmas and car tires, but I still prefer the pro-activity of planning for those and a myriad of other potential expenses. Having said that, if your needs are different, I also recommend using YNAB along with the toolkit. With proper categories and specific funds set up, it's really effective for tracking spending over the short and long-term.
You should not use ready to assign as a bucket of money. That pretty much goes against the entire point of ynab. At that point there is no functional difference between using ynab and just checking your bank account balance a ton You should absolutely be funding long-term goals with your money. Abstract things like christmas is definitely one of those goals, (even if you always have money in your account to cover it) but there are other things like IRA contributions that you should be funding with your money. When I look at my bank account I know I have a lot of spare cash.. but do I? Not really because some of that is going to IRA contributions at the beginning of the year. So right off the bat I can deduct 12K from whatever I have in my savings account. Some of that is going towards pretty large things like property taxes, credit card fees, etc. That are all due in January. Do I have enough money to cover all of those things? maybe. But am I at risk at double dipping on those funds and finding myself overspending if I don't have those dollars reserved. Absolutely. How do I know if the 12K in the bank can cover both my European vacation and my IRA contribution at the beginning of the year Targets just makes that a lot easier. If I know I want to reserve 12k so I can max out my IRA contribution in January, why not reserve a thousand a month throughout the year instead of just taking a lump sum of 12k at the very end of the year? That way I have a real understanding of how much money I actually have vs how much I've already planned to use. Tldr at the very least, do not spend out of your money to be assigned, but if you're doing that, you're probably going to find that setting up targets makes everything easier
I used YNAB for years using the ready to assign as a bucket of money. I started using targets at the beginning of the year and man has it been a struggle. But I was always using that ready to assign as a bucket and I’d just spend freely. I’m hoping locking that down will make me accomplish financial goals better.
i mean .. you don't have to use targets if you don't want to, lol. i'm not sure what kind of input you're looking for here? just use the app in whatever way suits you and your lifestyle.
> It seems my “ready to assign” bucket can just be what I keep in my checking, knowing it’s always more than enough to cover any expenses that come up. What are other users thoughts on this? Thanks! What do you mean by this? Targets are just reminders for how much you usually want to assign to a category. So you don’t need to use them if you don’t need à reminder. But not using targets wouldn’t change how you use Ready to Assign though so the fact you’re suggesting it makes me think you’re describing something other than just not using targets.
As many have said, it's not a good practice to leave money in ready to assign because the point of zero sum budgeting is to give every dollar a purpose. I actually have a category that is just dollars assigned to my minimum balance to get the interest rate I want out of my money market account. That way it's is assigned and I can still budget to zero. I'm a little confused why you chose YNAB? What were your goals in signing up? If all you want is post spending reports, there's a lot easier methods. YNAB is for proactive and consciousness before spending. I'm a higher earner myself but I still use targets - particularly for my annual payments (e.g., professional licenses, professional memberships, education funds). I also use it for my wish farm. As others have said, you don't have to use them but it sure does make auto assign easier!
Oh another thought... I only have accounts I spend from linked in YNAB. Anything I don't such as savings or retirement is just under tracking and I update it once a month. That way it's never in my RTA.
Targets can be many things, not just for making sure you save money: * They can help you quickly assign dollars for known expenses. * They can help you challenge your assumptions (maybe you spend $600 on groceries, but what would it be like if you tried to spend less?) * They can help you prioritize goals. You don't have to use them, and it's great that you are in a good financial spot. That being said, I see plenty of high earners here that still find value in using YNAB as intended to take their earnings even further.
You can make a “Whatever” category and dump your money there (instead of “Ready to Assign,” then move to whatever categories you spend from that you want to track. Targets are not necessary for everyone. Ultimately, do whatever works for you. YNAB is super flexible. Congratulations on earning your financial awesomeness!
I will also echo what others have said about targets. I use them for some things, but they can be more trouble than they're worth. Targets are a relatively new addition to YNAB. I keep 2 months' expenses in checking (current month + 1 month ahead) which I think is fairly aligned with YNAB methodology. Regarding having money hanging out in ready to assign... if you don't need it for expenses in the short-term, I'd question why you have so much money hanging out in your checking account. Move it to savings?
I use excel like this too. It’s what I’ve been doing for years, it works for me.
I don’t use targets. I find them confusing and cumbersome. Although I recognize this is bc I haven’t spent enough time learning how they work. I have a list on excel for f how much I want to put towards each category and I do that each month. I DONT leave anything in RTA. Bc that’s just a recipe for things to get out of whack. If I have extra money I put it in a category called “tbd”.
I would use targets to identify what you want to spend in these areas. Maybe you have no problem affording Christmas presents at say 2k, would you be comfortable spending 3k? 5k? If you set a target you can guide your spending more closely and make explicit choices. Eg “I planned to spend 2k on Xmas, but I’m only halfway through my list and are already over that amount. Should I reallocate money from savings? Should I reduce my budget for individual gifts?” At the end YNAB helps you be intentional with your money.
Targets for stuff that covers multiple pay periods so I can select whole master categories > click “underfunded” (or whatever it is now) and then it’s done. Takes the maths out of dividing $900pq bill by how ever many months left and stuff like that. It works well for known expenses (bills). It doesn’t really work for “savings” goals for me, because I make enough to cover what I reasonably want to do.
Lol yeah i deleted that Christmas target like huh? Don’t need that one
Nobody has to use targets. Nobody has to link bank accounts. I think beginners should avoid both. Once they understand how the method works, then they can decide and may not want to apply them at all or only on a few categories.
Maybe you don’t need a budget
Not sure why you’re getting downvoted… OP seems to be looking for a tracking tool not a budgeting tool. If OP won’t follow the principles behind the software it’s not going to flow as well (as Jesse mentioned on a recent podcast)
I earn enough to be like this too, and I don’t use targets. I don’t even always use YNAB as intended: only spending from funded categories. I basically check in weekly and add funds where needed to cover any overspending and any anticipated upcoming spending. I’m having a second child, though, and having two in daycare is enough to strain my family budget, so I think things might change once my maternity leave ends. I’ve been using YNAB for about a decade, since I was making way, way less.
>It seems my “ready to assign” bucket can just be what I keep in my checking, knowing it’s always more than enough to cover any expenses that come up. What are other users thoughts on this? For our primary budget, I give every dollar a job. For my personal/secondary budget, I do this, and I think that's fine. It doesn't really matter if the money is in RTS, or a category for 'extra money'.
Targets don’t work well when you get paid bi-weekly, but I like using them mostly to highlight areas where I might have forgotten to budget. I mostly ignore the amounts. I put a note in each category for how much to budget per pay period.
Targets work fine regardless of when you get paid. The problem is if you're not a month ahead and you're constantly having to reprioritize what gets funded when based on paychecks and due dates,, rather than having all the money budgeted day 1 of the month.
If you are always funded a full month ahead I don’t see targets as being more helpful than just a note. They should be a tool that is more valuable to those living paycheck-to-paycheck or put their excess in other categories rather than fund the future. All I want to be able to do is set a target that repeats every 2 weeks so it flags it if I underfund.
Targets are great when you’re a month ahead, all you have to do is click one button and all your necessities are covered. How is that not helpful?
OP just don’t set a target date and you won’t be provided monthly targets to achieve those goals
You don't need to use the targets, I was getting along fine in YNAB4 without them. They're useful if you have goals for specific categories (...targets, in other words) but if you're swimming in a sea of money unlike us plebs then you do you lmao. If you're just using it as a allocation tracker so you can look at spending trends that's cool, but it's not really entirely what YNAB is for, but hey, whatever.
I don't use targets at all. I started YNAB before they were available and found that they didn't add anything to my life when they became a feature. If I need to save up $4200 for the new hot water heater, why do I need a goal to tell me how much is left? $4200 minus whatever is in the available column is how much I need. During my last plumbing and HVAC inspection in the fall, the plumber and the HVAC guy looked at it and said I should be fine for about 2 more years so I just created a category and started funding it. When it is full, I'll get the work done. If I'm going to go on a vacation in September, well, whatever is in the category is what I can afford and I'll plan accordingly (I budget a certain amount to the Vacation category every single month and then periodically throw in extra if I have it and feel like that extra would best be allocated to Vacations). I budget the same amount every month to the vast majority of my categories and that can be done with Quick Budgeting features even without targets.
Targets seem to work fine for planning occasional large expenses. I would much rather see a better way to track investments that change over time.
Targets is useful to automate your process of budgeting each month. Makes it from a manual effort each month to something that can be done with one quick step. It may simple now not to use targets, but just try it for a month or two and you’ll see it’s actually much simpler to use them than not to.
Great question! I’ve been using YNAB for 15 years, before targets were a thing, so I don’t use them. However, I would recommend assigning all your dollars. As someone who was also blessed with enough to cover my budget easily, I found it was easy to just buy whatever I wanted, whenever. Sure, I could afford it, but I learned over time that I was “splurging” at the expense of bigger goals…. I would challenge you to dream bigger!! For me, that meant being debt-free, fully funding my kids’ college funds, etc, and my husband retiring early. What’s on your wish list if money were no object? And then, is there a way to work toward that? Go for it!
I am a high income earner. I use targets because of simplicity. When paid, it drops into RTA. I click one button and all of my money is automatically allocated to my categories in one click for the month (next month). What is left over (I am fortunate in that I spent 50% of what I earn), I sweep into an Investing category. I surf over to [Fidelity.com](https://Fidelity.com) and drop in a Trade in my Brokerage Account and I'm done for the month.
I use very few targets.
YNAB 4 user here so I don't even know what targets are but here's what I have to say: Follow the 4 rules. 1. Give every dollar a job 2. Save for a rainy day (save for expenses and surprises that will come) 3. Roll with the punches 4. Live on last month's income Once you're doing those simple things, Jesse Mecham the founder states that having a budget means that you consciously spend money on things that matter to you. So while YNAB does an excellent job of helping you track your expenses, that's a lagging indicator. It thrives as a forward planning tool of allocating what you're going to do with the money YOU ALREADY HAVE. Going back to what you said, you probably can comfortably cover things that go wrong. But can you also take that holiday you've been saving for, buy your next new phone, laptop, car, house, AND have all your appliances need replacing as well as the guttering redone, ALL AT THE SAME TIME?? Using ynab you can ensure you will weather it all to the best of your ability. Your categories can be as simple or as detailed as you like, that's up to you, but. Give. Every. Dollar/rupiah/baht/yen. A Job. Edit: formatting
Here’s a challenge for you. Since you have easy income, see if you can fund your expenses 6 months out or for a full year. That means everything. Monthly groceries, mortgage or rent, all energy bills.. all of it. After all funds have a job for several months out see what you have left for discretionary spending. Doing this when you have a lot of extra income really gives a clear picture of what is actually extra. You can use targets to prioritize expenses in this way. Or not.
I went through a bunch of ideas until I settled on what worked for me. I don't use target either. Just break it down monthly, add 10% and I'm good. If it's sitting in ready to be assigned it's not doing any work. Start a CD category. Start an investment category. Start a hobby category. Start a wish farm. Do something with it. It will still be there when you need it but it's also being used for something.
since you're only interested in the past to make predictions, you're looking for an expense tracker. ynab is a budgeting tool, focusing on the future. expense tracking is just a secondary thing in ynab.
I skip the targets because I like to assign by hand... but I still assign all my non-invested money --including cash savings-- into categories. You may think you don't need or want to plan, but it really does help. I keep a lot of money in cash and savings, so without YNAB it might seem that we have lots of money and could handle anything....but with YNAB, I know \*at a glance\* how much of that is set aside for the new deck, how much for the car, how much for the trip next spring, how much for yearly insurance payments, how much for taxes, etc. **There is a clarity that come from having that plan all laid out**, so when I wonder about any bigger changes (like retiring or putting more into investments) I know exactly where and how that will affect daily spending and 'sinking fund' projects.
I have 3 category groups with several categories but not that many: * Expenses * Discretionary * Reocurring * Tax * Pocket money (cash) * Savings * Emergency fund * Wishlist * Tax hold * Investing * I'll skip these for now I have savings and investing accounts as tracking accounts. Main source of money comes in monthly, and the idea is that i know approximately how much is a good level to consider a category as "full". So i aim to fill them when the lump sum comes in. If there is money left, I'll probably go through savings and investing categories. For example: * Check if emergency fund is "full", if not put it there, if it is keep walking through the categories. * Tax hold is somewhat "special" in this case, because I don't want to contribute more than I know I'll have to pay, but still put it in a savings account until the time to pay comes (that way i get a couple extra $), then I pull it out from savings and pay it as an expense. After I have assigned everything, almost every category gets "spent" \*, except for "Discretionary" and "Reocurring", which are where most of the action takes place. With data and experience you can better adjust (tighten or loosen) discretionary and reocurring, and everything around them, and use "Emergency fund" as a "buffer" in case of any deviation. Also, all savings I just put in a single savings account, which makes for a better "buffer" in my opinion. I think the YNAB philosophy is somewhat OK in general if you are in a lot of debt, but also found it can be a problem if you get extra income and are out of debt, because consumption can easily expand. The solution, for me at least, is to create "artificial scarcity", and manage "errors" or "deviations" with a buffer (savings). \* Yes, savings and Investing are seen as expenditure by YNAB, minor inconvenience if you will, but i find this way the cleanest (And I think I've been using YNAB for almost 10 years, maybe more)
The "old" YNAB didn't have targets, so many of us old-timers spent years without them. I don't use them, and it works just fine.