budgeting

aeonlight's Avatar

aeonlight

23 Jun, 2018 02:34 AM

Hi,
I believe this problem has been raised multiple times. The envelope budgeting still doesnt work and it's almost 1.5 years since I've started using moneydance. I have so much data embedded in moneydance that it's hard to even switch to another software. I feel kind of trapped in it and there's no way out. Is there a workaround that you all are using?

  1. 1 Posted by quotient on 23 Jun, 2018 02:47 AM

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    Hi, aeonlight. I'm just a user, not product support.

    I use a set up that pretty well matches Quicken's Savings Goals. From another posting, this is what I'm doing:

    I used savings goals in Quicken. I use "savings goals" in Moneydance. So far as I can tell, they work exactly the same way.

    I have some expenses that are annual in nature, and large. I want to budget for those large expenses. Here's what I do. For checking accounts, I have a parent account (call it Total Account) that functions only as a totalizer account; the balance of the Total Account, exclusive of the child accounts, always remains $0. I have four child accounts of the Total Account, one called Taxes, one called Insurance, one called Balloon Payment, and one called Checking Use. All my outside deposits and outside payments are transactions in the Checking Use account. Monthly, I transfer money from Checking Use into each of the other three child accounts; I calculated the amount transferred monthly to the child accounts to be the amount of funds needed to pay the annual expenses from each when those payments are due. I transfer money out of the appropriate child account into the Checking Use account when the payments are made. For me, this system works well, and works exactly as it did in Quicken.

  2. 2 Posted by aeonlight on 23 Jun, 2018 02:56 AM

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    Hi, for me, basically I have 2 accounts to manage. my personal account and a joint account for my family. In the past I used to use YNAB for almost 3 years and I was very reliant on envelope budgeting to gauge my spending. I understand the above method, that would mean I have to create child accounts for all the spending categories under 1 parent account right?

  3. 3 Posted by quotient on 23 Jun, 2018 12:50 PM

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    Yes, you'd create child accounts for all the categories or groups of categories that you wanted to set aside funds for. Creating child accounts is very easy and they appear in the side bar in a tree format.

    You can have as many Parent Accounts as you want, so likely you'd have a Total Personal Account with it's child accounts and a Total Joint Account with it's child accounts.

    Note that none of this is automatic; that is, you have to determine how much money you want to transfer to each child account and how much money you want to transfer out of each child account.

    I was concerned about reconciling my checking account, but found it to be very easy. You just reconcile the Total Account (there's a setting to include child accounts) and then do the normal reconcile procedure.

  4. 4 Posted by aeonlight on 26 Jun, 2018 03:24 AM

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    Have you tried the roll over budget function as well?

  5. 5 Posted by quotient on 26 Jun, 2018 12:05 PM

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    Sorry, I have not tried the roll over budget function since I use "Savings Goals" for my spending money management.

  6. 6 Posted by TJ Finlinson on 29 Jun, 2018 11:08 PM

    TJ Finlinson's Avatar

    I'll put in my 2 cents for what it's worth.

    I have experimented with several different methods to get 'savings goals' in Moneydance. Things have worked okay, but eventually they become to cumbersome, and I always end up going back to just using Moneydance as a electronic check register and keep track of savings goals and my budget in a spreadsheet.

    I have recently had some financial experiences that have motivated me again to look into a way to establish savings goals with Moneydance, but only if I could find a more sustainable method. I looked through many of the older support discussions and came across one about Envelope budgeting that said they were looking into using asset accounts to do an envelope systems. So I took to setting up a dummy MD file to see if I could come up with something.

    I'm attaching an outline PDF of what seems like a decent solution and also the Sample MD file I was playing with. I'd love feedback and suggestions. I'd love to see MD finally add something for savings goals and envelope budgeting to the software.

    You should be able to unzip the MD file and then restore it when you are in moneydance

  7. 7 Posted by Kevin Stembridg... on 07 Jul, 2018 10:57 PM

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    Hi folks,

    A couple of years ago I started implementing a Savings Goal feature in Money Foresight. Actually, I completed the feature on a development branch but ultimately decided not to add it back to the main branch. I never released the feature. The reason being that I think Money Foresight already provides the ability to manage Savings Goals without adding any extra features.

    I would love to get a better understanding of what you all have in mind when you think of a Savings Goal feature and I'll start by describing how I see things.

    For me, a savings goal is just a given amount at a given point in the future. You may have a specific purpose in mind for that amount (e.g. college tuition) or you may not (e.g. rainy day fund). You will likely have multiple savings goals of varying amounts and dates.

    Given that definition, I don't think there is any need for a purpose-built feature or to segregate money in separate accounts. You only need to be able to forecast your account balances.

    Let's say you have a savings goal of $10,000 in 6 months time. Just enter a transaction for that amount in an account register on the appropriate date. Your forecast will then tell you if you will reach that goal or not.

    Again, I'd love to hear how you think of Savings Goals and if my suggestion doesn't meet your needs.

    Regards,
    Kevin

  8. 8 Posted by TJ Finlinson on 29 Jul, 2018 02:28 PM

    TJ Finlinson's Avatar

    Kevin,

    Your Extension is critical to my use of Moneydance. I love being able to forecast the amounts. I agree with you that using the transaction reminders is a great way to keep track of how you are spending your money. I would like to see that I can earmark money in an account without adding false transactions to the bank account register that would need to be cleaned out when reconciling against the bank statement.

    If my bank account has $1000 in it, I think Savings Goals should allow you to virtually assign specific amounts to a goal/budget that you have and then you can use transactions reminders to forecast in those virtual categories and also see how the money is flowing in your bank account.

    Bank Account has $1000

    My Savings Goals (Virtually tied to my bank account) allow me to separate my money ($300 for Regular Expeses, $300 for vacation fund, $400 for Rainy Day Fund). I can assign a transaction to one of the savings goals categories so I can see the amount going down and matching my real bank account balance. I can also use the transaction reminders and your foresight extension to see what those savings goals will look like in the future and if I'm happy with them and on track.

    I think the only thing missing from Moneydance or from an extension is the ability to assign funds to a virtual account that could be treated as Savings Goals or Budget Items. The rest of it seems to be in place already. Using the sub accounts seems like it works, but would be nice to have that all done in the background and have the amounts be able to be positive rather then negative and then allow a nice visual representation of the status on the home page.

    I'm not using the set up I was posting, but posted it for feedback to see if It was something that might be a good setup for replicating savings goals.

  9. 9 Posted by Kevin Stembridg... on 29 Jul, 2018 10:29 PM

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    Hi TJ,

    Could you describe a bit more about why you want to see the money you currently have segregated (virtual or physical) into accounts (aka envelopes)? For example, is that what you use to make spending decisions? e.g. I'm going to the grocery store and I have $100 to spend in my Grocery envelope right now.

    I'll describe my understanding so far, which I'm sure is missing the mark somewhere. My basic understanding of the theory of envelope budgeting is that you can always spend money in a given category if there is money in the envelope for that category. But this approach is flawed if you don't know for sure that enough money will be added to the envelope before the next time you need to spend in that category. So forecasting is required. But this is where I'm not getting it. If forecasting is required and that involves predicting expenditure in given categories (as per transaction reminders) then why do you need to segregate the money you currently have?

    (It may sound like I think I already know the answer but I genuinely think I might be missing something, so happy to become better informed)

    Cheers,
    Kevin

  10. 10 Posted by TJ Finlinson on 31 Jul, 2018 03:52 PM

    TJ Finlinson's Avatar

    Kevin,

    Thanks for engaging with me again. Hopefully my reply will make some sense and isn't too long winded.

    I personally use 2 styles of budgeting/forecasting with my finances. I primarily use 2 bank accounts for my money. Account1 is the account I use for daily spending (groceries, fuel for cars, treats, entertainment) and Account2 is what I use for paying bills and other larger monthly/yearly expenses. I rely heavily on forecasting with your extension on Account2 since I have all bills setup as reminders and it let's me know just like you said if I have enough money to pay for the things I need to pay for. The reminders and the forecasting take care of the Savings Goals/Budgeting concept for me in Account2 so I don't want to set them up into virtual categories.

    I have reminders set up for Account1 so I can still see a forecast of the account, but since the reminders are always an estimate because these type of expense vary in amount, I would prefer to use a different budgeting/savings method. My preference for the spending style that I do with Account1 would be to have Savings Goals/Envelope Style budgeting to help me manage the money. This style allows me to manually assign all of the money in Account1 into virtual categories (groceries, fuel for cars, treats, entertainment, etc) and then assign my transactions to those categories and easily see what I have left and if I needed/wanted to I could virtually assign money to a different place for spending. So, I'm thinking that even though I do some forecasting on Account1, it would be valuable to me to have money assigned to virtual categories.

    -TJ

  11. 11 Posted by Kevin Stembridg... on 01 Aug, 2018 09:51 PM

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    Thanks for that, TJ.

    You mentioned you still have reminders for Account1 so that you can see it's forecast but when you make a spending decision would you just look at the amounts in your envelopes to decide how much you can spend? Would you also take into account the forecast?

    Do you also use the Reminder Review feature to confirm how accurate your reminders are for these irregular expenses? If so, what have you noticed? Does the review show a trend or is it not very helpful?

    Cheers,
    Kevin

  12. 12 Posted by TJ Finlinson on 04 Aug, 2018 04:15 AM

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    Kevin,

    My usual practice is to only look at my account balances in the right hand column for my Account1 and I currently use a spreadsheet to determine my amounts to spend for groceries, fuel, etc. However, the reminder review feature is good and I have looked at it a few times, but don't use very often to show me my spending. I should probably make that a more standard part of how I use your extension.

    After looking at it again, I can see that it could be something that I would want to use more often with an additional feature. Adding that would be a nice replacement for budgeting. Add the ability to save different category configurations in Reminder Review so that you could use the chart and table tabs to see just certain ones. That might also make the summary page view more useful, especially if you could switch between the saved configurations easily.

    One thing that I like about potentially being able to use sub-accounts or categories rather than reminders for setting savings goals or funding virtual envelopes is the fact that they have a register which allows you to see a history of what you have contributed to that goal/envelope. If you just change the reminder then you don't really have any history of your contribution.

    Thanks for listening,

    TJ

  13. 13 Posted by Kevin Stembridg... on 05 Aug, 2018 08:44 PM

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    Hi TJ,

    Since we're getting closer to talking about specific features in Money Foresight, I've logged this as a feature request.

    https://bitbucket.org/mahanaroad/moneyforesight/issues/112

    I've got a few more questions for you there.

    Cheers,
    Kevin

  14. 14 Posted by TJ Finlinson on 06 Aug, 2018 11:19 PM

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    Thanks Kevin. I went to the issue and tried my best to answer your questions.

  15. System closed this discussion on 05 Nov, 2018 11:20 PM.

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