I just got the YNAB trial & love it so far. I need to watch the videos & learn more but one thing I am especially curious about is - does it matter where your buffer comes from? Could we not just move over a month's income from our current emergency fund & call that our buffer? Our budget is very tight so I don't see how we could build a buffer just by underspending.
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I'm not a YNAB expert, but I am pretty sure moving one month's expenses from your emergency fund is legit. You can consider your buffer part of your emergency fund.
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That's what a lot of people do! Our emergency fund took a hit when FIL got in an accident a couple of years ago, and then when we had the baby and we can't afford to spare any at the moment or we would have done it. 3 months of underspending and we've saved up $300 in our buffer!
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@mrsmate: @Danizaur: Thanks!
The thing that confuses me is: So, for the sake of an example, say our monthly expenses are $1000. We move $1000 to be the buffer, but since we've been living essentially paycheck to paycheck, how do we then live on last's month's paycheck? Do we use our buffer & let this month's paycheck be the new buffer? I don't get it!
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We love YNAB, but don't do that buffer part lol.
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@daniellemybelle: at the beginning of the month you budget for all your monthly expenses since you already have the money (your $1000 buffer) That way when bills come in you can just pay them. Right now we're still timing out bill paying with paycheck days. When our buffer is full we won't have to do that. Plus it's easier to budget for a month than a pay period cycle.
For example, your paying May's expenses on Aprils income. Income you get in May you'll budget as "income for June" and there's your buffer for next month. You're living a month ahead which is a good thing regardless.
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yup, what @Danizaur: said
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@Danizaur: So we DO actually use our buffer/savings, and allocate our paychecks to the next month, then? It kind of turns into a rolling buffer, right?
Sorry if I am dense, haha!
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@daniellemybelle: yup you can definitely do that! and yes, it does become like a rolling buffer. you are essentially living off last month's income instead of waiting for the next paycheck to come in to pay your bills.
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8 comments