I've been reviewing my 2016 finances and want to do a bit of overhaul of how I keep track of things in the new year.
I use old YNAB (desktop app) for my daily budgeting. I also have my personal Balance Sheet set up in excel.
I tried and do no like Mint. And for some reason I can't get some of my accounts to work on Personal Capital.
However, I tried to look at my 2016 YTD income, expenses, savings, etc, and somehow I can't get a clear picture of how I did. My overall NW is up, so that's good. However, I have hard time figuring out what my true expenses were.
With the new year starting soon, I want to come up with slightly better system.
What I"m doing right now is when I get paid I enter that amount into YNAB as my income available to budget.
Then I dole out that amount to my various spending and savings categories until there is no money left to budget. I love the concept of budgeting every dollar and not leaving some money just sitting there with no purpose.
Couple things that muddle the picture are these:
- I get child support and right now I enter it also as income and budget it out like I do my regular income. Should it be income? Should I enter it as inflow into budgeted category? I'm not really sure.
- Transportation - I get my commute costs deducted from my paycheck pre tax so it never hits my budget and does not show up as expense. At the end of the year I basically have no transportation cost (or very little of it anyway). Also, I have a bit extra taken out for transit and use my transit check to buy train tickets and additional metrocards to use when my children go to see their dad. Those expense also never hit my budget. On the other hand, if my ex comes and picks them up instead, I reimburse him and that money comes out of my budget.
- Medical 1 - part of the year in 2016 I paid my healthcare premiums through payroll deductions. Also, I contributed to HSA through payroll as well. Then I was laid off in the middle of the year and am paying COBRA for the last 6 months. COBRA payments and my HSA contributions come out of my budget where as prior to being laid off, it never was part of my budget. In 2017, I will continue paying at least a part of the year (through end of March at least) for COBRA and HSA out of pocket.
I view my HSA account as my investment account as I haven't used to medical expense reimbursements, but it's showing up as a regular expense right now for the last 5 months.
- Medical 2 - I pay for all of medical expense (deductibles, coinsurance, etc) out of pocket. For medical expenses for my kids, I get reimbursed half from my ex. I never know how to show that reimbursement. If I put it as in inflow into the medical expense category, I lose a clear picture of how much medical expenses there really were. On the other hand, it's not really income so I don't want to show it as income available to budget.
- Same as above with some school expenses like school trips and such where I get reimbursed half from my ex.
The child support and medical reimbursements from my ex are not a given. Though he's very good about paying me, he's currently unemployed and hasn't paid in 2 months. I don't know how long it will take him to find a job. Once he gets a new job, he'll start paying again. However, I don't know if he will catch up on the missed child support payments. I told him that I expect a catch up, even if it will take a while to fully get caught up, but I can't count on any of it. I am trying to run my household as if he doesn't pay for anything. So keeping track of true costs and my individual income is important to me. But my system right now does not do a good job of it.
- Travel - I do some travel hacking. Some of my travel rewards are in the form of cash and I've accumulated quiet a bit of it. I've also used a bunch of it as well. For example, I got around $3,200 of cash rewards in 2016 so far. I spend some of it on travel and I still have about $900 left and it will be used for my upcoming cruise. I also some spent of 'my' money on travel as well. I'd like to be able to just know how much of 'my' money was spent on travel, however, I need to input 'travel hacking' cash into my budget as well to keep track of it.
Travel rewards that I get in the form of points or miles, I don't keep track of at all and don't look at those as expense. It's just the cash portion that I am having trouble with.
- Investments - at the beginning of the year, when I maxed out my IRA, it was transfer from my savings account to Vanguard. I don't keep track of my investments in YNAB, so it is showing up as an expense in my investments category in my budget. At the same time, my contributions into HSA (both through payroll and directly) do not hit investments category at all.
As a result of all of this, I have no idea how much my expenses really were. I also can't figure out how much I actually saved during the year. As my cash balance overall decreased since the beginning of the year, I know I sent some of my saved cash and did not live strictly on earned income, but some of the decreases are due to contributions to IRA and HSA, while others are due to living expenses when I was unemployed over the summer.
YNAB has been really good for keeping track and managing of daily day to day stuff while making sure that my cash accounts are all reconciled and my credit cards are all paid off. It also lets me keep track of spending requirements for credit cards for my travel hacking. But I am not seeing the big picture.
I've tried Mint in the past and I didn't like it. Personal Capital can't seem to connect to one of my 401K accounts and my checking/savings accounts at the credit union, and my HSA. It only sees my chase bank accounts and vanguard. Customer services hasn't been able to resolve these issues either. I also have few gift cards with balances on them and YNAB lets me to just enter them as accounts, whereas Mint or Personal Capital wouldn't, I think. For example, I got a bunch of Amazon gift cards through travel hacking. So I have them in YNAB as account with whatever balance is on them. When I buy from Amazon, the purchase is covered by the gift card, but at the same time, the amount of the purchase becomes my travel hacking cash reward.
Same when I pay credit card bill with cash rewards. That amount goes into my travel hacking cash.
And I only keep my cash accounts in YNAB. No investments.
As for my investments, I keep excel where each of the accounts is listed and I update it on the last day of the month. This give me a pretty good idea of the increase in those accounts month to month.
My balance sheet in the same excel file keeps track of my cash accounts, my investments accounts, my student loan balance, and net worth every month end.
But when I tried to figure out what my savings rate is/was during the year, how much I contributed to investments vs how much they appreciated, I couldn't see the numbers.
Any ideas?
PS: I know there are some on here who keep very detailed and meticulous records and some that are just looking at the big picture and don't bother with details.
I need to closer to detailed side of things. Keeping close eye on things is what keeps me comfortable, calm, and sane. When I don't know where everything is, financially speaking, at any given time, I start worrying too much.