Account Types: Budget vs. Tracking

When you add an account in YNAB, you'll notice that there are two types of accounts to choose from: Budget Accounts and Tracking Accounts. It's important that they be set up as the correct account type, because their type will indicate how they behave in your budget. 

A Budget Account is one that you will spend money from in the near future (usually within the next year or two). Tracking Accounts hold money you don't plan to spend soon, such as investments, or loans you're paying down.


Budget Accounts

The dollars in Budget Accounts are included in your budget (which you can tell from our super-clever naming scheme). These accounts should also include credit accounts from which you spend, so they're included in your budget as well. 

There are five Budget Account options to choose from:

  • Checking
  • Savings (It's important to Budget Your Savings!)
  • Cash
  • Credit Card (typically used for everyday spending)
  • Line of Credit (a flexible loan from a bank that you can access as needed and repay either immediately or over time)

Tough decision? Here's a little secret: Checking, Savings, and Cash all work exactly the same. They are accounts that typically have a positive balance because they're where you store money. 

What About Credit Accounts?

Credit Card and Line of Credit accounts typically have a negative or $0.00 balance, and funds spent from these accounts become debt. They aren't interchangeable though! If you use a credit card, it's important to select the Credit Card account type because of how these accounts work in your budget.

PayPal accounts are a great example: if you have a PayPal account where you receive, store, and spend funds, choose Checking or Cash. However, if you have a PayPal Credit account, you would choose Line of Credit. If you have a PayPal Credit Card, you would choose Credit Card. And while we're at it, if you simply use PayPal as a faster way to checkout and send/receive money in your other accounts, you don't even need to add it at all!


Tracking Accounts

The dollars in tracking accounts are not included in your budget. Adding these accounts to your budget allows you to track their balance (we told you we were clever at naming things!) 

Since the balances in these accounts don't impact your budget, you don't need to add any of them. But you can if you want to—there are two options:

  • Asset: investment accounts
  • Liability: mortgages and other loans

Budget and Tracking Accounts in

While activity in budget accounts will appear in all three reports — Spending, Income v Expense, and Net Worth — tracking account activity appears only in the Net Worth report.


Budget vs Tracking Accounts in Your Budget

You can see how your accounts are set up in the left sidebar: 

Remember, the dollars in your Budget Accounts is included in your Budget (so you can Give Every Dollar a Job), but the money in your Tracking Accounts is not included in your budget (since you're just tracking those accounts' balances). 

If you're moving funds between accounts, check out this article on transferring money next.

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