budgets and savings

We used YNAB for years, but the current subscription price increased to $99 a year. So we canceled that after I found a new budgeting software called Buckets. It costs $45 total, with no subscription, and has similar features to YNAB except for syncing with bank accounts and credit cards.

Philosophy

There’s a pretty good guide on their website. You add all your accounts that are part of your budget. I have all our checking and savings accounts, plus our credit cards. I also added our investments as “off-budget” accounts for tracking purposes.

Once you’ve added the accounts, then you budget the available amount. Buckets calls the available cash “Rain”. Each line item is called a “Bucket”. So, you catch your rain in each bucket until the available rain is 0. Buckets uses the budget to zero philosophy. I have buckets for rent, utilities, groceries, food, etc. If I overspend in a category, I will pull the amount needed to cover the overspending from a different category.

Goals

Each bucket can also have goals. There are 5 types of goals:

  • Plain old bucket: doesn’t have a dollar goal amount.
  • Recurring expense: use this if you want to track recurring expenses such as groceries, rent, etc. You can put a goal amount each month.
  • Save X by Y date: This is a good goal to use if you want to save a certain amount by a certain date. I use it for things like car insurance, which we pay every six months, or Costco membership, which is due in August each year. It will show you how much money you need to add to the bucket each month.
  • Save X by depositing Z/month: I use this if I am not sure when I need the money, but I still have a goal amount I want to achieve. You put in how much you can deposit each month, and it will calculate the goal date. If you put 0/month, it will show that you’ll achieve the goal “some day”. 
  • Save Z/month until Y date: I don’t really use this goal. You can use it if you want to save a certain amount each month until a certain date, but you don’t have a goal amount in mind.

The last 4 goals will add up to show you the amount of rain you need each month. If you have a bucket that no longer applies to your budget, you can “kick the bucket” to remove it.

Reporting Tools

There’s a reporting tool called Analysis. It contains a recurring expense report. There’s a trick to the expense report, though. If you transferred money from one bucket to another, you should open up the bucket by clicking the three dots, and check the box for “Transfer”. Otherwise, it will add this transferred amount to the recurring expenses calculation. There is also a net wealth report in the analysis. It adds up all your accounts, including the off-budget accounts. We’ve added all our investment accounts as off-budget accounts.

Adding Transactions

If you bought something, you add it as a transaction to the account you use. For example, let’s say you paid rent with your checking account. You’ll click on the checking account, then add the transaction there. It will also ask you to choose a bucket to categorize the transaction. I would choose the “Rent” bucket. If you have income, then you would add this as a transaction and categorize it as “Income”. It will then show up to the amount of rain in your budget.

If you use your credit card, then you would add the transaction to the credit card. The amount will be negative in the credit card account. We pay off our credit cards each month, so we would transfer the money from our checking accounts to the credit card, and categorize the transaction as a “transfer”.

Debts

I also have a loan for my iPhone, which I added as a “Debt” account. The balance reflects how much I still owe. It will automatically create a bucket for the loan, but you need to add money to the bucket. I added my monthly payment amount to it. Unfortunately, it does not have an interest calculation, so you would need to update the balance each month to reflect loans that have interest. Luckily, my phone loan is at 0% APR.

Conclusion

Overall, I really like the software. I only wished there was a sync option for all the accounts. You can add this by going to the Import option, and the only option seems to be SimpleFIN, which is a syncing service that costs $15 per year. I have not used this service before, so I don’t know how well it works. But, it’s definitely cheaper than YNAB, and it has most of the functionality. Plus, it’s an ongoing development, and the developer is working on a mobile app. I highly recommend this software to anyone who likes zero-based budgeting and has a lot of accounts to track.

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