I have a couple of envelopes that are in the red and I see no way of ever catching up on them, so is there a way to zero out those envelopes without using New or Available income
Hi @Wade - Thanks for your post! If you donât want to use new income or your Available to pay back those Envelopes, your other option is to use Envelope Transfers to pull money from Envelopes that have a surplus into the Envelopes that are negative. You can see how to create Envelope Transfers here: https://goodbudget.com/help/budgeting-with-goodbudget/how-to-transfer/
The problem is, there is no extra money in other envelopes to pull money from. I saw a post where someone had a car lone payment and the their car was totaled in an accident and the insurance paid off the amount owing and that was handled in Goodbudget by setting the balance to â0â. I was wondering if there was a way to do that with an âenvelopeâ?
Hey @Wade - I replied to your direct email. But Iâll add my reply in case other folks have similar questions.
Envelopes canât be adjusted independently like Accounts can. Thatâs because Envelopes are bound by how much money is in the Accounts that are being tracked.
So to get to your question, apart from creating an Envelope Transfer to move money around, or by Filling your Envelopes with new or existing money, there isnât a way to simply reset a Envelope to zero. The other option is to slowly work to pay back those negative Envelopes overtime by filling them a little bit each time you add money, rather than resetting them to zero all at once.
Hi Karisa: this is really the crux of what I am not understanding. I have started over with Goodbudget and my envelopes seem to go into the red right away. Then I do a fill but I am still behind. Then I have to reset my accounts because the unallocated (now available) is no longer accurate. It is a vicious circle and I think that the problem is that I just donât understand how the envelopes work with the unallocated funds and the fills. Do I need to go into Goodbudget everyday to move money around so that envelopes donât go into the red?
Sorry weâre just now seeing your reply! Ideally, you wouldnât have to transfer or fill your Envelopes everyday. But if you donât have enough to fill into your Envelopes at the start of the month, then you may need to be more involved when it comes to filling your Envelops to make sure that youâre not filling them with more than you actually have in your Accounts.
What you want to avoid is filling your Envelopes with money you donât have, so you donât overdraft your bank account.
Think of your Envelope balances (and your Available) as the money thatâs in your Goodbudget Accounts. Your Envelope balances + Available together add up to what you have in the Accounts youâre tracking.
I hope that helps!
Imagine you get paid in cash and you have a stack of actual paper envelopes. On each envelope you write âGroceriesâ, âRentâ, âGasâ, etc. You take the cash you just received and stuff your envelopes with it.
Now you need to go grocery shopping. You take only the Groceries envelope with you. You can only spend as much as is actually in that envelope. If you only put $100 in it on pay day then you can only buy $100 (or less) of groceries.
That is the mental model that Goodbudget is designed around. However, because itâs just a digital ledger it canât put actual controls on your spending the way physical cash in a physical envelope can, so you are able to spend more on groceries than you have put in your grocery envelope.
If your envelopes go red âright awayâ then you must be spending from them before actually filling them. If you are adjusting account balances to force the Available amount to be what you think it should be then you are doing it completely backwards. Available doesnât quite mean âavailable to spendâ, it means âavailable to put in envelopesâ.
When you do a hard restart in GB, which I have done a couple times over the years just to reorganize and reset, the first thing you must do is pick the date you want to start from. You could use âtodayâ or the 1st of the month, whatever makes sense to you. Now you go into your bank portal and get the actual balances of your accounts at the start of that date. Enter those account balances into GB Accounts. If you have cash then create a Cash account in GB, etc. Personally I have Checking, Savings, Safe Cash, Wallet Cash, and PayPal accounts in GB.
All of this money in all your accounts added together is your Unallocated/Available balance. It is Available (Unallocated) because you have not put it in envelopes yet. Itâs like you just got paid in cash and you have all the cash on the table in a pile and a stack of empty envelopes.
Now you do a fill. Distribute all your money into all your envelopes. Now your Available (Unallocated) balance is 0 because all your money is allocated to some purpose (i.e. it is unavailable for any other purpose). Or maybe you only allocate half your money to envelopes and leave the rest Available for the future. In either case, the Available balance is always the sum of your account balances minus the sum of your envelope balances, i.e. the money that is still available to fill envelopes with. You cannot edit the Available balance because it is always correct given the facts that GB knows. You absolutely should not try to adjust your Available balance by changing your account balances. Your account balances should always reflect the money you actually have in those accounts.
Now you record your expenses from the starting date forward. Expenses are simply taking money out of an envelope and spending it on something. If you take out more than the envelope had in it then it will go red. There are only a couple ways to fix that. Fill from Available (if you have any), Fill from New Income (if itâs pay day or you get a gift or whatever), or Transfer from other envelopes. The same as if you are going grocery shopping with cash but know it will be more than the $100 in your Groceries envelope so you take $50 out of your Eating Out envelope before you go to the store.
Available = Sum(Accounts) - Sum(Envelopes)
This equation is always true no matter what you do, even if various parts of the equation are negative.
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This should be pinned to the front page of the Forums. This is a simple yet eloquent explanation of exactly how Goodbudget functions at its core.
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Iâm deleting my post but sadly my shame has been immortalized in Kurtâs response 
The equation is always true at all times. The reason Available does not change as you spend money is because you are decreasing Sum(Envelopes) AND Sum(Accounts) by the same amount.
Of course youâre correct. I need to not answer questions before coffee 
And Iâm relatively good at math, but you wouldnât know it from this!
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