Source
r/ynab•
EngrProf42

Overdraft Prevention

General

I've been using YNAB for over a year now. It's helpful but I'm still in the paycheck to paycheck state because I need to sell my house. But, getting the maintenance done to sell it is difficult with no money. I'm seeing the end of the tunnel now but I wanted to post one thing for people like me who are still in the "don't have money" stage.

At least 3 times since I started using YNAB, I have overdrawn my checking account. YNAB does not distinguish what account your money is in. So, if I have a bill of say $54 and I have $53 in my checking account and $15 in cash, i don't get a warning. Every time I've overdrawn, it's been by less than $5 when I was busy and didn't calculate the balances by hand.

So, I have finally just made a category called "Overdraft Prevention" and put a few dollars in it. I made a transaction from my checking account for that amount so it looks spent and doesn't show up in my "available" on the budget page. Now, when I reconcile, there is an uncleared amount for the money I put in that category. It will never clear, because it's a fake transaction, but if I end up going over my balance by a few dollars, it will be covered.

I know I could avoid this by daily checking what my bills will be and checking my accounts, but I don't always have time for that. This is worth it in less stress and overdraft fees.

Posted May 4, 2019, 7:30 PM UTC

67
EngrProf42OP•

A few places only take cash so I always have to have a cash account and one bank account.

3
FWMan•

You can do it that way or do what many of is do, which is simply go all electronic and use only one account, at least until you have a balance of several grand and don't need to be so careful anymore.

2
Artheon•

Same here, just go one account until multiple accounts do not cause problems (which sounds like is happening with OP.) Especially if one is living paycheck to paycheck.

2
teflon916•

I keep my cash in a separate budget and move it to categories when I spend it. I also have a checking account safety net budget of $100 that I never spend. This prevents overdraft.

2
Marty398•

I do most of my budget work and tracking on a PC. So I can use the Toolkit to show a running balance on my accounts. With a lot of scheduled transactions, I know what my balance will be. (Most day to day spending is done with a CC.)

You need to be on a PC to Reconcile, so it's a good time to look forward at the projected acct balance.

2
EngrProf42OP•

I use the PC for most things. I look at the running balance from toolkit but if one of my bills is a couple dollars more than I expected, I go negative. The clear answer is to sell my house, but now the AC is broken and I don't think I can sell it that way.

1
Marty398•

That sucks about the AC.

When I first started with YNAB, one of my first goals was to save an Emergency Fund and I kept most of it in Checking. It unintentionally served to avoid overdrafts, much like your Overdraft Prevention category. I know you are right on the edge, but try to put a few dollars into that category every paycheck if at all possible. It will help keep you just a little further from the overdraft edge and eventually give you a small Emergency Fund.

2