Tracking Loans

If you've got debt, that's probably one of the reasons you thought, I need a budget. Your budget is exactly the tool you need to pay it off.

You've got two choices to track and organize your debt-payoff-bonanza in YNAB – the key is whether or not you add the debt account in YNAB.

Method 1: Just the Payments

To pay off a debt, all you really need is to make sure you're budgeting for the payment (or more!). You don't need to worry about tracking the debt in YNAB, and you don't need to worry about tracking interest, splitting payments, or anything like that. Just. Make. The. Payment.

1
Create a category to budget for your loan payments.
2
Don't set up your auto, student, or other loan in YNAB.
3
Sit back, relax, and enjoy the simplicity of having not set up your auto, student, or other loan in YNAB.
4
Budget for your payment each month, pay it on time, laugh at debt.

Method 2: Debt Account Included

Sometimes, you have to track everything. It's okay. This method isn't simpler, but that's why Tracking accounts exist. And if being able to see debt balances go down on your  Net Worth Report helps you deal with your debt, well hey, there's no one judging you!

1
Set up your loan account, selecting Other Liability as the account type.
2
Create a category to budget for your loan payments.
3
Set up your auto, student, or other loan in YNAB, with the amount you owe as the starting balance.
4
Budget for your payment each month.
5
When it's time for your payment, create a transfer from your main spending account to the loan. Categorize it with the category from step 1.
6
When you are charged interest on the loan, enter an outflow in the loan account, and the balance will be updated to the full amount you owe.

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