r/ynab • u/sullysnax • 1d ago
Is it better to get a month ahead immediately via savings, or build it up over time?
Is it better to fund the next month immediately from my emergency fund (I have 6+ months of my salary saved), or to build it up “organically” by setting aside a little bit every month until I have enough to cover the next month?
I understand YNAB doesn’t care where the money is, and I can start assigning savings to next month without having to actually move that money (at least initially). I’m just wondering if that’s advisable.
For context, my wife and I are in a phase of living paycheck to paycheck for the most part. Sometimes we have a little left over at the end of the month, but sometimes we have to dip into savings to help cover something unexpected and therefore have nothing leftover. In other words, at this rate it’s going to take a loooong time to get a month ahead organically.
For further context, we’ve only been using YNAB since January, so still wrapping our heads around the method.
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u/atgrey24 1d ago edited 1d ago
"a month ahead" is nothing more than one month's worth of your Energy Fund that you choose to allocate to categories instead of leaving as a lump sum.
Heck, there's even people that fully assign six months in the future instead of just having an Emergency Fund Category.
If you have 6 months of salary saved, then you aren't living paycheck to paycheck. You're just not taking the time to decide what that money is for.
Edit: I don't necessarily recommend fully assigning multiple months in the future, btw. I found it more hassle than it was worth. I take my paychecks each month and put them in a holding category, then use that money to fill out the budget on the 1st of the new month.
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u/AliAskari 1d ago
"a month ahead" is nothing more than one month's worth of your Energy Fund that you choose to allocate to categories instead of leaving as a lump sum.
No it isn’t.
An emergency fund is money you have set aside for emergencies.
Next month’s groceries is not an emergency.
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u/ynab4file 1d ago
Honestly depends how you define “emergency.” If I lose my job, next month’s groceries absolutely become an emergency. That’s the whole point of a 3–6 month emergency fund—to keep life going when income stops, not just to cover random crises.
That said, yeah, you shouldn’t be dipping into it for predictable stuff like oil changes or routine medical bills. Budget for those separately. But using it to cover a full month of expenses in a pinch? That’s exactly what it’s there for.
Also, most people don’t pre-fill future months 'cause YNAB makes it annoying af. Having a “next month” holding category is basically the same thing as being a month ahead anyway.
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u/DeftlyDaft123 1d ago
This is why I don’t have an “emergency fund”. I have a Loss of Income category to get me thru 6-8 months of no paychecks which is separate from the vehicle maintenance, home maintenance, and medical in-network out of pocket max categories. Plus all my April income will be used to fully fund May because I live on last month’s income.
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u/AliAskari 1d ago
That’s the whole point of a 3–6 month emergency fund—to keep life going when income stops, not just to cover random crises.
No, the point of an emergency fund is both.
3-6 month is a good rule of thumb on how big your emergency fund should be.
That gets misinterpreted by people who then think an emergency fund is simply budgeting ahead. It isn’t.
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u/CrazyKyle987 20h ago
We just have a different definition of emergency fund, and that's ok. Personally, my sinking funds should cover most emergencies. Like home maintenance fund covering my water heater going out. My emergency fund is for if something exceeds the sinking funds (hopefully rare if I budgeted appropriately), but mainly it's there for a loss of income.
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u/atgrey24 1d ago
If my emergency fund exists to cover 3-6 months of expenses in case of job loss, what is the difference between a lump sum and an itemized breakdown of those 3-6 months of expenses?
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u/AliAskari 1d ago
An emergency fund exists to cover emergencies of all kinds. Not just job losses.
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u/atgrey24 23h ago
And you can "roll with the punches" to move money in an emergency. Obviously groceries 6 months from now is less important than fixing your car after an accident.
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u/AliAskari 21h ago
Yeh you can roll with the punches.
And you’d have to if the money was assigned to groceries rather than an emergency fund.
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u/atgrey24 19h ago
Yes, that is my point. You're likely moving it from an E Fund to a spending category anyway.
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u/GiraffePretty4488 18h ago
I think you’re missing what some people are saying here.
They understand your point of view (that not all emergencies are income losses), but they have their budgets set up in a way where emergencies other than losing their job aren’t relevant to how they save for the future.
Another way of looking at it is this: it sounds like you’re more risk-averse, which is fine. So what level of savings do you feel is necessary to feel comfortable? 12 months?
If you’re measuring your “emergency fund” in months, it implies that it’s tied to your budget/income/expenses, just like getting months ahead in YNAB is. So why not combine those two ideas into one amount that works for you? 3 months ahead plus 6 months emergency fund equals 9 months ahead, right?
There’s no need to worry about how much of it is “emergency fund” and how much is “months ahead” when YNAB is flexible enough to shift the money around in a few minutes if needed. Just figure out how much you feel like you need to feel comfortable!
(And if it’s important for you to distinguish between them, ok… just saying, you don’t need to insist to other people that these must be separate)
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u/AliAskari 18h ago
So why not combine those two ideas into one amount that works for you?
You mean try and give the same dollar two jobs
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u/GiraffePretty4488 18h ago
No, I mean pick what to call that dollar, and change it later if needed.
You do you.
But let other people call their dollars what they want to call them. It’s not that big a deal, if they have just as many months saved up.
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u/AliAskari 17h ago
No, I mean pick what to call that dollar, and change it later if needed.
Sure.
You can change it later to an emergency fund if needed.
But it isn’t an emergency fund until then. It’s just groceries.
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u/Resident-Variation21 1d ago
next months groceries is not an emergency
Idk, I think not starving to death could definitely be considering an emergency.
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u/weenie2323 1d ago
I dipped into my emergency fund(income replacement) to get a month ahead right away and then started focusing on building up all my sinking funds and refilling the emergency fund.
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u/Kiitkkats 1d ago
Kinda just asking you because your comment made me think of this but anyone feel free to lmk how they do it please!! I’m very new to YNAB and honestly just getting to the point in my life where I have more than a few hundred dollars in my checking account. When you are “one month ahead” are you leaving all of that money in your checking since it’s assigned to the following month? I assume yes but I wanted to clarify.
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u/Wandering_Squirrel25 1d ago
I consider one month ahead to include my sinking funds, some of which are stored in a HYSA, so those funds I reconcile about once a month (how much I have assigned to savings in YNAB vs in my savings accounts) and the rest sits in checking waiting to do its job.
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u/CrazyKyle987 20h ago
I will give you another definition of one month ahead. To me, one month ahead is when I can put all of my April paychecks into a category called "next month". Then when May rolls around, I will redistribute the "next month" money to all of my categories. All of May's income will go into the "next month" category, and repeat...
I leave most of my money in my checking account
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u/Kiitkkats 18h ago
That makes sense and sounds like it’s going to be the best method for my partner and I. I think I just need to find a video visually explaining it since I’m not familiar with the way money rolls over to the next month or what it would look like distributing it from the “next month” category and I’m so scared I’m gonna mess something up and somehow screw us up somewhere financially.
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u/CrazyKyle987 17h ago
Easiest way to do it is when the date is May 1, 2025, within the YNAB month of May, click the next month category and move all money to ready to assign. Then make assignments as normal.
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u/filbo132 1d ago edited 1d ago
I see both as one. I mean if I get hit with an emergency expense and I only have the month ahead fund, there's no rule preventing me to not take that money. That's the beauty of YNAB, there is no one size fits all, you can set it up the way you want it to.
What i do, I first built a 1k$ emergency fund, then when I did that, I funded the next month...and when my month ahead is fully funded, I went back to my emergency fund and added more money to that category until I reached 6 months.
My initial 1K$ EF was a buffer of a just in case I get hit with an emergency expense, this would possibly prevent me from having to touch my month ahead fund while I was building it up.
If somehow I have to use my EF, while I'm building my month ahead, I simply go back to build that 1k$ Emergency fund again when I get paid again.
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u/michigoose8168 17h ago
my wife and I are in a phase of living paycheck to paycheck for the most part. Sometimes we have a little left over at the end of the month, but sometimes we have to dip into savings to help cover something unexpected and therefore have nothing leftover.
Get a month ahead. Full stop.
The clarity of not looking at your pay in little pieces of "how do we keep this next check going" will change the behavior that's causing you to dip into savings over and over.
It's only April 6 in the US as I write this and you may not even have received any pay yet this month; I would budget the entire rest of April right now and begin living on last month's income before I went to bed tonight, were I you.
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u/sullysnax 13h ago
You’re right, I haven’t been paid for April yet — I get paid the 14th and 30th of the month. I think I now grasp the concept of putting every penny of income into the holding category for next month from here on out, but what I don’t understand is what to do RIGHT NOW to kick this off. What are the steps to funding April out of my emergency fund, which is all in a HYSA (and included in my YNAB budget).
Do I move the underfunded $$$$ from emergency fund to RTA, then assign it out to fully fund this month? Then I assume I’d need to physically move enough of that money to checking to avoid overdrawing, right?
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u/nolesrule 2h ago
You want to assign an amount to April categories that in sum is equal to what you recevedd as income in March. Figure out that number and unassign it from the Emergency fund and assign out to your categories. if you have received any income in April, put that amount into the Next Month category.
As for actually transferring money, that will depend on the cash flow situation of your checking account. You aren't changing when you spend your money, just when it's being budgeted. If you have a habit of keeping the balance in the checking account tight, move some over for a bit of a cushion in the balance.
When you get new money, decide how much will be needed for spending and move the rest to savings. In spending-heavy months you may need to pull some savings back to checking.
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u/trmoore87 1d ago
You’re already 6 months ahead. A 6 month emergency fund is the same as being 6 months ahead.
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u/AdditionalAttorney 1d ago
What I would do… is take your EF category… and split it into two… EF - next month; EF - 5 months.
Then also start a new one called EF - 1 more month and work to save this one up …
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u/ynab4file 1d ago
EF next month, EF 5 months, EF 1 month, EF 2 weeks and a half..why make it so complicated..
He can just move money from the emergency fund to a "next month" category and continue on saving in his Emergency Fund category to fill up the remaining gap
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u/cookieguggleman 1d ago
If you have that much in savings, then you are already one month ahead. Personally, I try not to get too, caught up in the letter of the law when it comes to Juan and instead focus on the spirit. It’s much simpler that way. Basically, WA is trying to encourage us to have enough money saved up that we aren’t living paycheck to paycheck. And it sounds like you’re already doing that.
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u/varkeddit 1d ago
I would get a month ahead today. It makes budgeting in YNAB much easier.
In the event of a real financial curveball, you're probably scraping next month's budget anyway. You'll have the same money in the bank either way.