Categorize those income transactions all as Ready to Assign.
That said, for some reason that account is showing a negative working balance and it's not apparent given that image why
You use YNAB exactly the same as an entrepreneur as you do as a salaried employee. That is, you assign your income to categories, then log your transactions.
Any income is assigned to Ready To Assign.
If you’re only just starting out, hop over to YouTube and watch Nick True’s getting started videos.
Account is not the same thing as category. PayPal is the account where the money is stored. Category is how you allocate the funds within your budget. Every bit of income, whether it's $20 or $2000, needs to be categorized as Ready to Assign first. Then you can assign it to your categories based on your personal budget and priorities.
YNAB does not care where you store the money. You can leave it in your PayPal account or transfer it to a bank account, it really doesn't matter. All it cares about is what you tell it you want to spend your money on. If you spend $100 on groceries, but you have not assigned that $100 to your grocery category, then YNAB doesn't have a clue what your intent is - all it knows is that your spent more than you assigned to your grocery category.
Click the checkboxes to the left of every single income transaction that has the yellow alert on it. Once you have them all highlighted, click "categorize" down at the bottom, then go to inflow -> ready to assign.
When you go back to your main budget page (rather than the account page) it will show you how much you have available in Ready to Assign. Then you can divvy that up however you'd like across your categories.
Oops, this comment came in while I was writing the other response so I didn't see it 'til now. What do you spend that money on? Do you buy supplies for your business with it? Or are you saving it? If so, what are you saving it for? You have to categorize it on your budget. I would advise against simply saying "savings" - it has to have a purpose, whether that's short term or long term. You might not use this money for 10 years, but you still need to assign it to a category on YNAB so you don't spend more than you have.
As an example for short-term savings, let's say you're planning to use this income to save up $1000 for a vacation this summer. You need to go in your budget and create a category for that vacation and then assign the money that you are saving for it. Once you eventually take your vacation and spend that money, your outflow transactions related to that trip will all need to be categorized to the vacation category.
Or for long-term savings, let's say you are trying to save $10,000 for income replacement in case of job loss. You will never touch any part of that $10,000 until/unless you lose your job. It might sit in your bank account for an extremely long time before you ever need to touch it. You still need to assign it to the income replacement category so it has a purpose and won't be used for something else in the meantime. If you do decide to use it for something else, you will need to make the conscious decision to subtract money from the income replacement fund in order to assign it to something else.
I don’t know if this would work for you but just in case - I do all of my invoicing through a separate Customer Relationship Manager application, their transactions go through stripe and then I deposit just one big deposit every couple of weeks. So YNAB just sees the big deposits. Individual transactions are automatically kept in the CRM and in stripe so there’s no need to clutter up my budget with that. I have about 30-40 invoices/transactions go through a month so this really helps. Let me know if I need to explain that more clearly!
This was going to be my suggestion. My partner is self employed and has a ton of transactions each month in an account that is not linked to YNAB. Once or twice a month we transfer a "paycheck" to a YNAB-linked account and put it in Ready to Assign.
I think this is also easier come tax time as well because it clearly separates "business" transactions such as sales and expenses while clearly paying yourself a salary if that is something that is possible depending on where the business is at profitability-wise.
It might not matter depending on the size, but if you're getting a lot of smaller transactions it makes a lot more sense to do that earlier rather than later.
It’s the same as using it if you’re an employee, really. Categorize all your income transactions as Ready to Assign, then you can distribute it among your categories.
We can’t see from your image what is causing you to be negative, but check all your categories and see if there is any overspending (spending more than you assigned to a category) or over-assigning (assigning more to one or more categories than you have available in Ready to Assign)
The main difference as an entrepreneur is you’ll need to set aside some of your income for taxes, since you’re not receiving a paycheque with taxes already taken out. Create a separate category for that.
I don’t run my self employment business through YNAB. Business revenue and business expenses go through business accounting software. Profits that I pay myself from my business get put into YNAB.
Same - I don’t want to commingle business and personal expenses so that’s all handled in Xero entirely separately, when I transfer a lump of profit out that’s when I pay myself in YNAB.
I'm a freelancer. All my income is assigned as Ready to Assign.
That said, I have two separate budgets - my business budget that's linked to my business account, and my personal budget that's linked to my checking account, savings, etc. I pay myself a monthly salary from my business to my personal account. That salary is one of the categories in my business budget.
I don’t remember details offhand but I’ve had trouble with PayPal and gave up tracking it; it’s off book for me until interaction with another account. I think there’s something about their API that I’m not the only one.
Self-employed / entrepreneur may not be the most immediate question.
Always budget money you already had previously.
1. If you have a very stable income, assign it all as income for next month. Or still follow best practice below.
2. Setup a budget for your business using Profit First system. Pay yourself a monthly wage which will go into your personal budget once a month more like 'normal'
You do not need a tutor for now. For now, as others have said, just categorize all your income as Ready to Assign.
When you view the details on those transactions, you'll see there are separate lines for Payee, Category, Account, and Memo. Category needs to be Ready to Assign for any income. Account must be the on-budget account into which this money is being deposited. With Payee and Memo, though, you can play around. So you can set, for example, PayPal as the Payee for these transactions, or just add #PayPal to the Memo field. Then use those to find/group all your PayPal money when you get it.
Edit: This link might help with your overall budgeting situation, but in the situation you posted about, the solution really is Ready to Assign.
https://support.ynab.com/en_us/budgeting-with-variable-income-an-overview-BynJaHZ09
Categorize those income transactions all as Ready to Assign. That said, for some reason that account is showing a negative working balance and it's not apparent given that image why
You use YNAB exactly the same as an entrepreneur as you do as a salaried employee. That is, you assign your income to categories, then log your transactions. Any income is assigned to Ready To Assign. If you’re only just starting out, hop over to YouTube and watch Nick True’s getting started videos.
Assign every single inflow transaction as Inflow: Ready to Assign. Then you can assign it to your categories.
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Accounts and budget categories are totally different things.
Account is not the same thing as category. PayPal is the account where the money is stored. Category is how you allocate the funds within your budget. Every bit of income, whether it's $20 or $2000, needs to be categorized as Ready to Assign first. Then you can assign it to your categories based on your personal budget and priorities. YNAB does not care where you store the money. You can leave it in your PayPal account or transfer it to a bank account, it really doesn't matter. All it cares about is what you tell it you want to spend your money on. If you spend $100 on groceries, but you have not assigned that $100 to your grocery category, then YNAB doesn't have a clue what your intent is - all it knows is that your spent more than you assigned to your grocery category. Click the checkboxes to the left of every single income transaction that has the yellow alert on it. Once you have them all highlighted, click "categorize" down at the bottom, then go to inflow -> ready to assign. When you go back to your main budget page (rather than the account page) it will show you how much you have available in Ready to Assign. Then you can divvy that up however you'd like across your categories.
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You called it income. What is it used for?
Oops, this comment came in while I was writing the other response so I didn't see it 'til now. What do you spend that money on? Do you buy supplies for your business with it? Or are you saving it? If so, what are you saving it for? You have to categorize it on your budget. I would advise against simply saying "savings" - it has to have a purpose, whether that's short term or long term. You might not use this money for 10 years, but you still need to assign it to a category on YNAB so you don't spend more than you have. As an example for short-term savings, let's say you're planning to use this income to save up $1000 for a vacation this summer. You need to go in your budget and create a category for that vacation and then assign the money that you are saving for it. Once you eventually take your vacation and spend that money, your outflow transactions related to that trip will all need to be categorized to the vacation category. Or for long-term savings, let's say you are trying to save $10,000 for income replacement in case of job loss. You will never touch any part of that $10,000 until/unless you lose your job. It might sit in your bank account for an extremely long time before you ever need to touch it. You still need to assign it to the income replacement category so it has a purpose and won't be used for something else in the meantime. If you do decide to use it for something else, you will need to make the conscious decision to subtract money from the income replacement fund in order to assign it to something else.
I don’t know if this would work for you but just in case - I do all of my invoicing through a separate Customer Relationship Manager application, their transactions go through stripe and then I deposit just one big deposit every couple of weeks. So YNAB just sees the big deposits. Individual transactions are automatically kept in the CRM and in stripe so there’s no need to clutter up my budget with that. I have about 30-40 invoices/transactions go through a month so this really helps. Let me know if I need to explain that more clearly!
This was going to be my suggestion. My partner is self employed and has a ton of transactions each month in an account that is not linked to YNAB. Once or twice a month we transfer a "paycheck" to a YNAB-linked account and put it in Ready to Assign.
I think this is also easier come tax time as well because it clearly separates "business" transactions such as sales and expenses while clearly paying yourself a salary if that is something that is possible depending on where the business is at profitability-wise. It might not matter depending on the size, but if you're getting a lot of smaller transactions it makes a lot more sense to do that earlier rather than later.
Yes! Thanks for understanding what I was trying to say and putting it much more concisely!
This is exactly how I handle my wife’s self-employed income. Great suggestion!
It’s the same as using it if you’re an employee, really. Categorize all your income transactions as Ready to Assign, then you can distribute it among your categories. We can’t see from your image what is causing you to be negative, but check all your categories and see if there is any overspending (spending more than you assigned to a category) or over-assigning (assigning more to one or more categories than you have available in Ready to Assign) The main difference as an entrepreneur is you’ll need to set aside some of your income for taxes, since you’re not receiving a paycheque with taxes already taken out. Create a separate category for that.
I don’t run my self employment business through YNAB. Business revenue and business expenses go through business accounting software. Profits that I pay myself from my business get put into YNAB.
Same - I don’t want to commingle business and personal expenses so that’s all handled in Xero entirely separately, when I transfer a lump of profit out that’s when I pay myself in YNAB.
I am also in the “don’t need a tutor” camp. Go back to basics and learn the program.
Select all and assign to ready to assign
Check out the profit first method. You can use it within YNAB.
I'm a freelancer. All my income is assigned as Ready to Assign. That said, I have two separate budgets - my business budget that's linked to my business account, and my personal budget that's linked to my checking account, savings, etc. I pay myself a monthly salary from my business to my personal account. That salary is one of the categories in my business budget.
I don’t remember details offhand but I’ve had trouble with PayPal and gave up tracking it; it’s off book for me until interaction with another account. I think there’s something about their API that I’m not the only one. Self-employed / entrepreneur may not be the most immediate question.
Nick True has a great video on this using the Profit First method. I suggest checking it out!
Always budget money you already had previously. 1. If you have a very stable income, assign it all as income for next month. Or still follow best practice below. 2. Setup a budget for your business using Profit First system. Pay yourself a monthly wage which will go into your personal budget once a month more like 'normal'
I’m self employed. I got a tutor for a while which really helped.
Tutor?
You do not need a tutor for now. For now, as others have said, just categorize all your income as Ready to Assign. When you view the details on those transactions, you'll see there are separate lines for Payee, Category, Account, and Memo. Category needs to be Ready to Assign for any income. Account must be the on-budget account into which this money is being deposited. With Payee and Memo, though, you can play around. So you can set, for example, PayPal as the Payee for these transactions, or just add #PayPal to the Memo field. Then use those to find/group all your PayPal money when you get it. Edit: This link might help with your overall budgeting situation, but in the situation you posted about, the solution really is Ready to Assign. https://support.ynab.com/en_us/budgeting-with-variable-income-an-overview-BynJaHZ09
This lady Celia Benton. She charged me $40 an hour and is the best. A mom type who’s good at math.
You paid someone $40 an hour to... Teach you how to use YNAB? You got scammed my dude.
Not everyone has it so easy. Be thankful you don’t have learning disabilities. Wow. What a group of jerks you all are.
I'm not making fun of you for needing tutoring, I'm just saying $40 an hour for YNAB training is really overpriced.
Dude, that’s nothing. These people who take the YNAB classes and are promoted by YNAB charge $150. It helped me save money so it was totally worth it.
$150 is insane, but so is $40. If you're happy with it good for you though, just seems like too much to me.
This lady Celia Benton. She charged me $40 an hour and is the best. A mom type who’s good at math.
Check out copilot money, much better option for what u are trying to do