Working Budget RRS feed

  • Question

  • I have covered everything in my working budget except my mortgage payment, which is split to a principal portion, an interest portion, and an escrow portion.  I have looked all though adding an expense, looking at Savings and Debt, and looked on the loan account to see if I could check a box for budget planning.  All to no avail.  I could just remember that the working budget needs to have a surplus to cover the mortgage, but that just seems like an inaccurate way to do it.  I am running the last version of the sunset package for personal use.
    Tuesday, November 19, 2019 10:46 PM

All replies

  • It is difficult to help with budget questions because:

      - everyone has different ways thinking about and structuring a budget

      - the Money budget functionality is, IMHO, complex and counterintuitive

      - the approach is different for the Advanced Budget, the Savings and Spending Budget, and the Essential Budget

    My only experience is with the Advanced Budget.  For that case, my specific advice is to add the Mortgage Interest category to the budget, and break up the escrow amount into expense categories (taxes, insurance, whatever) and add those categories to the budget.  Those are all real expenses that you pay for the privilege of having title to the home.  In contrast, the mortgage principal isn't an expense.  It is a transfer of your money into the value of your home.  In Money, that is done by a transfer of that principal to the asset account for your home.  I expect that your mortgage loan payments are set up that way.  You can include those transfers in the Special category of the budget.

    More generally, I found that, when starting to set up a budget, it was very inconvenient and confusing to try out different budgeted amounts for each expense using the Money budget.  Money keeps trying to create new budgets and it applies new budget values to prior data when that is not at all what you might want.  Instead, I set up an Advanced Budget with all of the expense categories I want to track, put in rough budget amounts for each category, run a Annual Budget report, and "Export to Excel".  My real budget is in LibreOffice Calc, so I ignore the imported Money budget values and instead compare my LibreOffice Calc budget values to the imported actual expenses from Money.  It is a bit of work to set up, but it allows you to, for example, import historical data and easily compare those data to various budget scenarios.  You can also set different budget values for monthly expenses such as gas or electric that vary through the year.  I could not figure out how to do those kinds of things with the Money budget.  Also, using a spreadsheet makes it easy to generate bar charts or plots of budget vs actual expenses.

    Once you settle on budget values you can run the Annual Budget report each month and look at actual expenses vs the budget values which are safely stored in your spreadsheet.

    Bill Becker

    Wednesday, November 20, 2019 4:18 AM