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Budgeting Terms: The YNAB Dictionary of Definitions

Ready to WAM that wish farm? Reconcile the monthly rollover? Track your True Expenses?

If you’re a beginner budgeter, or just new to YNAB, and feel like you need to pull up Google Translate to get started—have no fear, you’ve come to the right place to discover the definitions of popular budgeting terms.

From official finance jargon to YNAB-specific lingo, we’re going to define everything from A to Z (or from Account Register to Zero-Based Budgeting, if you want to get specific about it) in this handy dandy glossary.

Common Budgeting Terms in YNAB

Let’s get started:


Account Register: The account register is where your transactions are listed in YNAB, and the place where you can add, edit, or delete transactions. Basically, this is where most of the money magic happens. (Insert a bow-chicka-wow-cha-ching sound here—in your imagination, of course.)

Activity: The activity column in YNAB lists the total of all transactions that have been made in that category for the current month. If you click it, you’ll see the exact breakdown of those transactions. It’s a silent record keeper of how many dollars have been spent. Sometimes we appreciate this mute tracker, sometimes we do not.

Age of Money: Age of Money (or AOM for fellow acronym lovers) indicates how much time has passed from the day you enter a dollar into your budget to the day you spend that same dollar. So, if the current age of my money is 14 days when I enter a new paycheck into my budget, I’ll be spending that check two weeks from now, based on my current pace of spending. Let your money age like a celebrity with a skilled plastic surgeon by living below your means.

Assets: An asset is something of value, like cash, your checking account, savings account or 401k. Your collection of Beanie Babies doesn’t count. No, for real, it doesn’t. Wait, Beanie Babies are valuable again? But really, don’t overcomplicate your assets in your budget: if it contains actual dollars, go ahead and add it to your budget. If it’s less easily accessible dollars (retirement savings, a mortgage, cryptocurrency), we recommend keeping those off-budget in a Tracking Account.

Assigned: The Assigned column in YNAB represents the total amount of money you’ve given to your budget categories for the month. This number may be negative if you’ve un-budgeted or moved money from a category, and that’s okay! Things change and flexibility is good.

Auto-Assign: The Auto-Assign options make it easy to budget and assign dollars to multiple categories at a time, based on Targets or how much you’ve spent or assigned in the past. Auto-Assign helps simplify budgeting (and math!), which keeps your focus where it belongs: on your decisions.

Available: The available column is your True North, your oracle, your crystal ball, your source of truth—where you look to guide your spending decisions. Can you really afford your umpteenth billion stop at the coffee shop this month? The available column can tell you. Any money left in the available column carries over at the end of the money. Learn more about available amounts when the month rolls over.


Balance Sheet: A balance sheet is a summary of assets and liabilities at a fixed point in time. It’s also known as a “statement of financial position” and can help define the net worth of an individual or organization.

Banksy: What? You don’t know Banksy? Allow me to introduce you to your new budgeting buddy, Banksy—YNAB’s pink piggy bank mascot. We love Banksy, and you will too. Banksy is cute, fun, and proud of your budgeting prowess!

Budget/Budgeting: Budgeting involves making a realistic, flexible plan for the money that you have in your possession right now. It should ideally feel less like a diet, and more like a well-balanced meal plan that includes your favorite things. Budgeting isn’t a set-it-and-forget-it one-time activity. It’s a long term process, and you’re allowed to tweak and adjust whenever you need or want to. You can think of your budget as a road map of your priorities.

Budget Accounts: Budget accounts are the accounts you spend money from, and usually include checking, savings, or credit card accounts. All the dollars from those accounts combine to make up the Ready to Assign number.


Category: Categories in YNAB represent the stuff you’ll be spending money on. Think of each category like an envelope that you’ll be sticking cash in to spend later. Those dollars have jobs once they’re in their categories; they’re earmarked for a specific purpose and, in theory, shouldn’t go wandering off to the Sephora sale if that’s not their job.

Category Group: A category group is like an umbrella over a stack of similar envelopes. For example, that Sephora sale money might be paper clipped to your hair salon money in your Self Care category group.

Cleared Balance: Your cleared balance in YNAB is the sum of all of the cleared transactions in your account register. These are the transactions both you and your bank know about. When you reconcile your account, you compare your cleared balance in YNAB to your bank balance, and when those two numbers match, you feel like the best budgeter on the planet—like you just won the YNAB World Series—which should totally be a thing. Read more about the other balances in your account register here.

Credit Card Payment Category: The credit card payment category is automatically created when you add a credit card account in YNAB. The “available” amount in this category is the amount of money you’ve set aside in your budget to pay to the credit card company. If your credit card payment category numbers don’t look right, start here.


Direct Import: If you’ve connected your bank accounts, direct import pulls in your transactions in YNAB for easy and accurate on-the-go budgeting. Transactions import to YNAB once they clear your bank (which can take a day or two), so it’s best to enter your spending right away so that the numbers you’re looking at are always up-to-date. When transactions are imported, they’ll automatically match up with the ones you entered—like magic. When you reconcile, you can make sure that all transactions were accounted for. Having trouble with a connection? Try our troubleshooting steps.


Emergency Fund: Think of your emergency fund as a superfood of financial health. (Goji berries, anyone?) Car broke down unexpectedly? Have no fear, your emergency fund is here. In your budget, consider the Emergency Fund just another one of your True Expenses. Build up a nice cushion in your Emergency Fund category to prevent you from the inevitable rainy days.

Envelope Budgeting: With envelope budgeting, your budget categories are represented by actual envelopes. Every time you have new income, you put the amount of money you want to budget for each category, in cash, into the corresponding envelope. Then you carry a bunch of envelopes around, I guess? It sounds inconvenient to us, too. It’s like the original form of zero-based budgeting, and we’ve created a digital, much more convenient version of it with YNAB.


File-Based Import: File-based import happens when you upload your bank account data to YNAB using a file, like a .csv, QFX, QIF, or a spreadsheet. This is a great option if direct import isn’t available from your bank.

Forecasting: Budgeting is making a plan with the dollars you already have and forecasting is making plans with future money, before you have it. Forecasting is budgeting’s slightly wilder, riskier cousin. Let’s say you started assigning next month’s paycheck dollars to jobs—that’s forecasting. But what if next month’s paycheck never comes? Then you might be back to budgeting change you find between the couch cushions so that you can afford groceries. Forecasting can be fun, and can serve a purpose, but budgeting always has your back.

Fresh Start: Sometimes life gets complicated and you just want to hit a “reset” button. Same thing happens with budgeting. YNAB gets it, so we’ve turned Fresh Start into an action you can perform in the main menu. With the push of that virtual button, you can safely archive your existing budget and start over with a transaction-free, activity-free budget that still contains your accounts, account totals, scheduled transactions, categories, targets, notes, and payees.


Goals: In old YNAB, Goals were amounts you set on categories. Now? They’re just called targets. That leaves Goals for the things you actually want to save for: a trip to Tahiti? A ski cabin? Game on.

Income v Expense: If you dabble in data nerddom, this is often your favorite YNAB report. Loved by accountants and translated into your personal budget—the income v expense report is a cash flow statement that shows how money came in, and where money went out in one tidy spreadsheet.

Interest: Interest is the money that you earn in profit when you invest your money. On the flipside, when you borrow money (like on a credit card or with a loan), interest allows you to buy time. Interest gives you permission to pay the balance back slowly. An interest rate is typically reflected as a percentage of the total money invested or borrowed.


Liability: Liabilities are debts—and they sit opposite of assets. While assets boost your net worth, liabilities bring it down—as you’re on the hook for the remaining balance. In your budget, you’ll add things like credit card debt, a mortgage on real estate, a car payment, or student loans as liabilities.


Monthly Rollover: The monthly rollover is the transition period when one month ends and another starts—and is often celebrated as a ritual among YNABers with tea, coffee, or a favorite beverage. You’ll clear out any overspending from the current month and prepare your budget for the month ahead. Learn more about how to handle the monthly rollover.

Money Moves: See a trail of breadcrumbs in your budget with Money Moves in YNAB. You can access a recent history of every time you’ve moved money between categories or into categories. This is great for those who frequently walk into a room and wonder why they just walked into that room, and less great for those partners who were previously doing some short term money laundering to inflate their coffee category. Sigh.


Net Worth: Generally speaking, your net worth is your assets minus your liabilities. In YNAB, we’ve created a Net Worth report that takes all your accounts (including tracking accounts) and gives a picture of your cash and assets compared to your debt. These can get quite pretty over time, like this snapshot of one YNAB user with ten years of data:

Net worth is a budgeting term that summarizes your financial health.
A YNAB net worth chart showing 10 years of progress


Overbudgeting: If your Ready to Assign is red, you’ve got more money assigned than you have money on hand. Too many jobs, and not enough dollars to fill them. Fix that by reducing the amount assigned in your categories until your Ready to Assign is back to zero. You can fill those remaining “jobs” or increase the dollar amount allocated in your categories as more money comes in.

Overspending, Cash: If you spend more money than you have in physical cash, checking, or another debit account, lights flash and sirens start blaring. Not really, but that would be cool. You will need to take action though, because you’ve spent more dollars than are assigned to your other categories. Stop and read Rule Three if this happens, it can help.

Overspending, Credit: You have overspending that happened on a credit card and this increases your debt. This means you’ve spent money borrowed from your credit card company that your budget can’t pay back from your checking or cash accounts. Credit cards can encourage that sort of thing. Learn more about how to do credit cards in YNAB.


Paid In Full: You have enough set aside to pay your credit card down to $0, even if you choose to pay the statement balance instead. The credit card payment category’s “available” amount should be a green, positive number that matches the negative working balance owed on your card. Doesn’t match? Read more about that here.

Pending Transactions: If you’re a direct import user, you’re well aware of the lag time between swiping your card and seeing that transaction in your budget. We call this bank time. With pending transactions, you see transactions that are in process but haven’t cleared the bank yet within your account register. Learn more about how to use pending transactions here.


Ready to Assign: Your Ready to Assign amount is the money in your accounts that doesn’t have a job in your budget yet. It’s just languishing around, probably sleeping until noon and binge-watching Netflix, not even applying itself to make a difference in your world. If your Ready to Assign is red, you’ve overbudgeted, so you need to remove money from your categories until it’s back to zero. When you get new money, you’ll categorize it as Inflow: Ready to Assign, and it will appear in your Ready to Assign so you can give those new dollars jobs. Put all of your dollars to work!

Reconcile: To reconcile, compare the balance and transaction history of your bank account to the balance and transaction history of your YNAB budget. If they match, you get to do a happy little reconciliation dance and congratulate yourself on a job well done. If they don’t match, you can’t trust your budget—which means you can’t make the best spending decisions. Try to reconcile as often as possible (if you’re a new YNABer—reconcile daily!)  to make sure you’re staying on track and haven’t missed anything. And so that you can have those spontaneous dance parties more frequently.


Targets: Targets allow you to choose how much you would like to spend, save, or set aside over time in a category. Want to go on a trip to Tahiti? You can! Some day. When you have targets set up in all of your categories, you’ve created a Budget Template, which can tell you how much money you need to earn each month. With targets, you can also use Auto-Assign to help you quickly assign money to your categories. Targets help make things happen.

Tracking Account: Tracking accounts are the loans or investment accounts that you want to keep an eye on, but can’t use the money for your day-to-day spending. The money in tracking accounts does not affect your budget. You only set up these accounts to track your balance. Mortgages, student loans, and 401ks are all good examples of tracking accounts.

True Expenses: True Expenses are non-monthly expenses that don’t happen every month. Think car registration, home repairs, vet expenses, holiday gifts, etc. You may have heard these called Sinking Funds. An Emergency Fund is also an example of a True Expense. Use targets to help you save for these so they don’t sneak up on you.


Uncleared Balance: Your uncleared balance in YNAB is the sum of all of the uncleared transactions in your account register. These are the transactions that your bank doesn’t know about yet. You can enter your uncleared transactions as soon as they happen so that your budget doesn’t forget about that last-minute Target run you made (even if you try to block it from your memory.)


Working Balance: Your working balance in YNAB is the sum of your cleared and uncleared balances. The money in your budget is based on your working balance, which is why it’s important to reconcile regularly (we recommend daily if you’re just getting started)!

Wish Farm: A wish farm is as magical as it sounds. Remember how budgeting isn’t supposed to feel like deprivation? A Wish Farm is a special category group system you create in your budget to track and save for special one-time items. Create a category group titled “wish list” adding as many items as you want, each with its own category line. After you assign each item a small, medium, or large dollar value, create a separate “wish farm” category group and send your top three highest priority items to it, noting that your wish farm can only contain one small, one medium, and one large wish list item at a time. Trickle any extra money you can into your three wish farm items until they are fully funded. When it’s time to purchase that item, move the money to the appropriate category before purchasing (i.e. new skis to “fun money”, new book case to “home improvement”) and repurpose the completed wish farm category to house a new wish list item.

Whack-a-Mole/WAM: You know that carnival game where you use the foam mallet to bop mechanical moles on the head as they pop up randomly from their holes? Yeah, we do that with our budget. Budget whack-a-mole, or WAM, is when you have to borrow money from one budget category to cover expenses in another. It happens, and it’s more than okay—it’s encouraged! That’s how we roll with the punches (Rule Three!) and have a budget that can bend and not break.


YNAB Broke: YNAB Broke is a bit of a misnomer, because it doesn’t mean you’re out of money. To be YNAB Broke means you’re out of money in some categories, but you probably still have plenty of money in the bank. For example: “I want to go out to eat, but I’m YNAB broke!” You can be YNAB Broke on the last day of the month and YNAB LOADED the next day. It actually means you’re doing a good job with budgeted spending!


Zero-Based Budgeting: Zero-based budgeting means that every dollar you have has an intended purpose. Every dollar gets a job until there are no dollars left. In zero-based budgeting, if you give more money to one category, you have to give less to another. And it works, because it encourages you to clarify your priorities and stay focused about your spending. Learn about how YNAB is zero-based budgeting in action.

And there you have it! We’ll keep this list of budgeting terms and definitions updated as we think of terms we’ve missed…or as we make up new words and phrases.  

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Budgeting Terms: The YNAB Dictionary of Definitions