How to Reconcile Accounts
Reconciliation is the process of comparing the transactions and balance at the bank and the transactions and balances in YNAB to make sure they agree— and also clicking the Reconcile button in YNAB. If it's been awhile or you're new to reconciling, review Getting Started with Reconciling Accounts first. Let's walk through the process!
In This Article
- Why is reconciling your account in YNAB important?
- The Steps to Reconcile
- Video Overview
- What to Expect after Reconciling
- What to Expect the Next Time you Reconcile
Why is reconciling your account in YNAB important?
Your budget is based on the amount and transactions in your account in YNAB. We reconcile to make sure they are correct.
Clicking the Reconcile button in your account register also tells YNAB not to import previous transactions, even if the bank tries to send them again, which reduces the possibility of duplicates. And since linking your accounts brings in transactions, not balances, you'll want to reconcile all the more when using Direct Import.
Clicking the Reconcile button in YNAB puts green lock icons 🔒 next to reconciled transactions, so you know how recently your balance and transactions in YNAB agreed with your bank.
The Steps to Reconcile
To get started, you'll need your account register in YNAB, your current balance at your bank, and a list of bank transactions. Follow these steps to reconcile your accounts:
- Open YNAB in one tab on your computer, and your online banking platform in another tab.
- Find your current cleared balance at the bank.
- Finding your cleared balance can be tricky the first time—banks use all sorts of different language to describe the cleared balance. The number you are looking for won’t include any pending transactions and is most often called the Current Balance. Ignore your statement because that often only shows you transactions from a time frame, rather than your full current balance. Make note of where you find that number because you'll use it every time you reconcile.
- Process your uncleared transactions.
- In your account register in YNAB, sort the register by uncleared by clicking the Cleared column header or search for is: uncleared in the search bar.
- Process all of your uncleared transactions; their status in YNAB should match the status at the bank. If they have cleared the bank (or are very old), mark them with a green 'c' by clicking the 'C' icon to the right of the transaction. If they are pending at the bank, or your bank doesn’t even know about them yet (like a check you wrote), it should have a grey 'c' to indicate it is an uncleared transaction. You can delete a transaction if you find it doesn't belong.
- Import , approve, and categorize any waiting transactions. Then look over the past 3 days of cleared transactions according to your bank. If any aren’t included in YNAB, enter them manually now and mark them as cleared.
on the Reconcile button in YNAB (actually pressing the button and completing the steps is important—it does some work behind the scenes to keep everything running correctly).
- If your cleared balance at the bank matches the cleared balance in YNAB, click YES!
- If your cleared balance at the bank does not match the cleared balance, click no, and enter your current cleared balance. (Note: If you’re seeing a positive balance in YNAB but don’t actually have one in real life, be sure to enter a negative amount here, for example, -500.00). Then click Create Adjustment and Finish.
Here's a video walkthrough of the reconciliation steps. You'll notice we've made some visual & verbiage updates since these videos were created, but the method remains the same!
What to Expect after Reconciling
Your cleared balance in YNAB will match the cleared balance at the bank (to the penny), and your uncleared transactions will be limited to those you've manually entered in the past few days and will clear the bank in the near future. All of your reconciled transactions will have little green lock icons 🔒 in place of the cleared 'c' icon.
If you created a balance adjustment, that will affect your budget because the amount of money in your budget is based off the amount of your cash-positive accounts in YNAB.
Head over to your budget and move money where you need it. If you created a balance adjustment in a credit card account, double check that the card's Credit Card Payment category in your budget has the amount you want set aside for your next payment. If you pay your card in full that means you should have the exact amount in your Credit Card Payment category as the working balance of the card. If those differ, move money to/from the category as needed until they match.
What to Expect the Next Time you Reconcile
The next time you reconcile, you'll follow the same steps but you’ll only need to reconcile the transactions that don't yet have the lock symbol. We recommend reconciling your spending accounts at least once a week. The more often you reconcile, the quicker and easier it is each time!