YNAB You Need A Budget

[Sairey724Gamp]

This topic seems to come up so often that I decided to start a specific thread for it. Post your questions and tips here (or link to previous posts). That would certainly save all of us a lot of searching throughout the entire forum. Here's looking forward to lots of great ideas!

A few links for starters:
Reimbursements from the Wiki
What if Rule 4 were an option? discussion beginning on page 7
Suggestion for tracking job expenses to be reimbursed?

Sairey

[dmauder]

I've read the various posts about how to handle reimbursable job expenses in YNAB, but none of them seem to make sense to me.

I sometimes incur job expenses that I have to charge on my own personal credit card, or pay for with cash. I then submit an expense report and get that money back (added to my regular paycheck) 2-3 weeks later.

No matter what I try to do in YNAB to track these expenses and reimbursements doesn't seem to work right for me.

Can anyone explain a good method as if I were a 5 year old?

Thanks!
Dave

[Maggie Magpie]

I could be wrong on this, but if it were me, I'd enter the expenses as a "WORK EXPENSE" category and then enter the reimbursement later "supplemental" when it comes in later. OR, I'd ignore the expense and ignore the reimbursement because the 2 cancel each other out. The issue is simply the 2-3 week time frame. Also, knowing that this will temporarily affect your cash flow, I wouldn't procrastinate the expense report, which I know you're probably not, for the Type B personalities out there......

[ginger]

I thought I'd write up how I handle some of my reimbursable expenses. It's not a method I've seen recommended here, but it's what I do in Quicken and I ported it to YNAB.

I created a separate account called "To be reimbursed" (hereafter TBR) so it has a separate register tab. If you are familiar with accounts receivable this will make sense to you. When I incur an expense I want to track this way, instead of putting a category on the transaction I do a transfer to my TBR account. This increases the balance of the TBR account because money I am owed is an asset (the opposite of owing someone else, which is a liability). I put an entry in the memo field so I know who owes me the money because I can't use the payee field when I do a transfer. When I get paid back I do a transfer back from TBR to whatever account I'm depositing the reimbursement, which does not have to be the account I originally transferred from.

Generally I use this method for expenses that may take a while until I get the money back so I don't want to lose track of them. I have one doctor's office that always owes me money because they don't want to wait to find out from the insurer how much I really owe. I owe a percentage of a reduced negotiated payment, so they guess what the reduction will be, calculate my percentage, and they always have me pay too much. On my next visit in six months they give me a credit for my balance with them, figure out my new charges, and I overpay again.

I haven't had any business reimbursables to track since I started YNAB this year, but when I do I'll create a separate account tab for those just to keep them out of the personal account.

I like this TBR account because I have a register that tracks these monies owed me. When I get paid back I mark the incoming and outgoing transfers as cleared. I can sort by cleared status and easily see how much I am owed, and who owes me how much if I enter my memo comments consistently. Because I don't use categories I don't get confused when I get reimbursed in a different month than the expense occurred.

One caveat: Because I use transfers my "remaining" balances in the budget do not get reduced with this method. The total I am owed sits in the TBR account but is not spendable for, say, my electric bill. So someone without a buffer would need to be careful with this. You could put a category on the incoming and outgoing transfers if this were the case for you.

If anyone's interested I could type up an example or two.

[debtbuster]

Ginger,

I love your way of doing things and your explanation. This is a great idea. I just had a bank error this month and had to create a new category called: bank expenses. Now they reimbursed. I would probably benefit from your idea because I also submit things for reimbursement from my work occasionally.

[ginger]

Ginger,

I love your way of doing things and your explanation. This is a great idea. I just had a bank error this month and had to create a new category called: bank expenses. Now they reimbursed. I would probably benefit from your idea because I also submit things for reimbursement from my work occasionally.

Great! I'm glad it's useful for somebody.

[J.Mann]

I really like your accountant approach of reimbursable expenses! Never even though about doing it that way!

I thought I'd write up how I handle some of my reimbursable expenses. It's not a method I've seen recommended here, but it's what I do in Quicken and I ported it to YNAB.

I created a separate account called "To be reimbursed" (hereafter TBR) so it has a separate register tab. If you are familiar with accounts receivable this will make sense to you. When I incur an expense I want to track this way, instead of putting a category on the transaction I do a transfer to my TBR account. This increases the balance of the TBR account because money I am owed is an asset (the opposite of owing someone else, which is a liability). I put an entry in the memo field so I know who owes me the money because I can't use the payee field when I do a transfer. When I get paid back I do a transfer back from TBR to whatever account I'm depositing the reimbursement, which does not have to be the account I originally transferred from.

Generally I use this method for expenses that may take a while until I get the money back so I don't want to lose track of them. I have one doctor's office that always owes me money because they don't want to wait to find out from the insurer how much I really owe. I owe a percentage of a reduced negotiated payment, so they guess what the reduction will be, calculate my percentage, and they always have me pay too much. On my next visit in six months they give me a credit for my balance with them, figure out my new charges, and I overpay again.

I haven't had any business reimbursables to track since I started YNAB this year, but when I do I'll create a separate account tab for those just to keep them out of the personal account.

I like this TBR account because I have a register that tracks these monies owed me. When I get paid back I mark the incoming and outgoing transfers as cleared. I can sort by cleared status and easily see how much I am owed, and who owes me how much if I enter my memo comments consistently. Because I don't use catagories I don't get confused when I get reimbursed in a different month than the expense occurred.

One caveat: Because I use transfers my "remaining" balances in the budget do not get reduced with this method. The total I am owed sits in the TBR account but is not spendable for, say, my electric bill. So someone without a buffer would need to be careful with this. You could put a category on the incoming and outgoing transfers if this were the case for you.

If anyone's interested I could type up an example or two.

[ginger]

I really like your accountant approach of reimbursable expenses! Never even though about doing it that way!

It's a curse. My brain just works that way.

[abcwick]

That's how I track both business and personal expenses/debts. Having the separate "Work Expense Debtor" account is also an excellent double check when I come to compile my month end expense claim (as everything is, or should be, already recorded in YNAB).

I would, though, second the caveat in one of the posts above regarding being careful to remember that a debtor is just that until it's paid - you can't spend it. Therefore you need to have enough hard cash available to "fund" the debtor - YNAB just counts a debtor or cash as the same - available funds to be allocated jobs.

[lebdavidson2]

I thought I'd write up how I handle some of my reimbursable expenses. It's not a method I've seen recommended here, but it's what I do in Quicken and I ported it to YNAB.

...
I haven't had any business reimbursables to track since I started YNAB this year, but when I do I'll create a separate account tab for those just to keep them out of the personal account.

I like this TBR account because I have a register that tracks these monies owed me. When I get paid back I mark the incoming and outgoing transfers as cleared. I can sort by cleared status and easily see how much I am owed, and who owes me how much if I enter my memo comments consistently. Because I don't use catagories I don't get confused when I get reimbursed in a different month than the expense occurred.

One caveat: Because I use transfers my "remaining" balances in the budget do not get reduced with this method. The total I am owed sits in the TBR account but is not spendable for, say, my electric bill. So someone without a buffer would need to be careful with this. You could put a category on the incoming and outgoing transfers if this were the case for you.

If anyone's interested I could type up an example or two.

I would LOVE examples, I'm not quite getting it. Also, I want the money I've paid out to look unavailable until it comes back as a reimbursement. Can you explain that bit again?
Thanks!

[noonsailing]

I would, though, second the caveat in one of the posts above regarding being careful to remember that a debtor is just that until it's paid - you can't spend it. Therefore you need to have enough hard cash available to "fund" the debtor - YNAB just counts a debtor or cash as the same - available funds to be allocated jobs.

But with transfer transactions you can put half of the transfer in a category, and not assign a category to the other half. So, you could have a category for Reimbursable Expenses, as well as register(s) for your debtor(s)/account(s) receivable. I like this idea so much that I actually do it.

My real world example (payees and category names have been changed to protect the innocent)::

First, I go on a trip and accidentally use my credit card instead of the corporate card to pay for gas. The Credit Card register side of my transaction will be entered as:
Date = 8/20/09
Payee = Transfer: Company Account
Category = Misc: Reimbursable Expenses
Memo = Shell Gas for Rental Car
Outflow = 16.96

My budget view will show an expense and resulting negative carryover to the following month in the Reimbursable Expenses category. The other side of the transaction is strikingly similar, except it doesn't have anything in the Category field!
Date = 8/20/09
Payee = Transfer: Credit Card
Category =
Memo = Shell Gas for Rental Car
Inflow = 16.96

Second, I file my expense report and wait. I get paid my regular paycheck and move on to the next month's budget. My available balance is 16.96 short, so I either absorb that by reducing the amounts budgetted elsewhere or I put a negative 16.96 in the budget for Reimbursable Expenses. We'll say that I just budget less for this month's gas. I pay my credit card bill. Meanwhile a positive balance sits in my Company Account register, 16.96 that's not available to be budgeted or spent.

Finally, I get my reimbursement. Now, I put a transfer transaction in that removes the IOU from my company account and puts the money in my checking account. The half in my Company Account register:
Date = 9/25/09
Payee = Transfer: Checking
Category =
Memo = Company reimbursement from August
Outflow = 16.96

Now the Checking side of this transaction needs a category. I can indicate this as income and then go budget it, or I can credit it to my Reimbursable Expenses category. I'm going to say that I put it in the Reimbursable Expenses category. That'll look like:
Date = 9/25/09
Payee = Transfer: Company Account
Category = Misc: Reimbursable Expenses
Memo = Company reimbursement from August
Inflow = 16.96

Now when I go look at my budget, I have 16.96 negative in the spending column for that category. Ooo... that gives me a positive value for remaining in a category that I don't want to carryover. However, it is an option that will allow me to budget that category down to zero (possibly by sending it over to the gas category that I shorted at the beginning of the month) without fiddling with my available number, or altering my apparent income.

Now, if you're getting your reimbursement added in with your regular paycheck, things will be basically the same. However, you'll have a split transaction with a Transfer to deal with. Just for fun, here's an example. The direct deposit of paycheck:
Date = 9/30/09
Payee = The Company
Category = Split transaction
Memo = Paycheck with travel reimbursement
Inflow = 3,016.96

In the split:
Checkbox = Checked, because we've got a transfer

First Line::
Category = Income: Primary
Transfer =
Memo = Regular Pay
Amount [or Inflow] = 3,000

Second line::
Category = Misc: Reimbursable Expenses
Transfer = Company Account
Memo = Travel Reimbursement
Amount [or Inflow] = 16.96

Hit okay, and if you get a popup tell it that you received the money. You won't even need to go look at the Company Account register, because that half of the transaction will already appear the way you want it!

Date = 9/30/09
Payee = Transfer: Checking
Category =
Memo = Travel Reimbursement
Outflow = 16.96

Now you can go look at your budget and distribute the income or redistribute the positive Reimbursable Expenses balance.

Complicated? Perhaps. But you know when the company owes you money, and how much, plus you won't be spending the same money twice... at least not until after they actually pay you back...

[ginger]

I thought I'd write up how I handle some of my reimbursable expenses. It's not a method I've seen recommended here, but it's what I do in Quicken and I ported it to YNAB.

...
I haven't had any business reimbursables to track since I started YNAB this year, but when I do I'll create a separate account tab for those just to keep them out of the personal account.

I like this TBR account because I have a register that tracks these monies owed me. When I get paid back I mark the incoming and outgoing transfers as cleared. I can sort by cleared status and easily see how much I am owed, and who owes me how much if I enter my memo comments consistently. Because I don't use catagories I don't get confused when I get reimbursed in a different month than the expense occurred.

One caveat: Because I use transfers my "remaining" balances in the budget do not get reduced with this method. The total I am owed sits in the TBR account but is not spendable for, say, my electric bill. So someone without a buffer would need to be careful with this. You could put a category on the incoming and outgoing transfers if this were the case for you.

If anyone's interested I could type up an example or two.

I would LOVE examples, I'm not quite getting it. Also, I want the money I've paid out to look unavailable until it comes back as a reimbursement. Can you explain that bit again?
Thanks!

I see noonsailing has stepped up in my absence to answer your question. We've had an illness and death in my family (funeral this coming week) and I've not been around.

If you still need more help please post back. I should have time to give a more in-depth answer next week if you need.