Budgeting

[Thomas D . Jordan]

As far as budgeting goes, I like the envelope method the best.

You pre-allocate the money into a virtual envelope that is a
sub-account under your bank account (checking).

When money comes in through an income account, a filter script
could be run to allocate the planned amount into the envelope.

Also tie the allocation amount to the income source.
In case you want to split your allocation dependent upon the income
source's frequency.

Mirror the envelope under your main expense account.
Pay into these expense account only from the appropriate envelope.

If the envelope is short, then the user must decide which envelope
they want to re-allocate from.  This forces them to make a
budgetary decision upfront.

Reports can be generated on the envelops to reveal how often the
envelope came up short and highlight the needed change in their
budget plan.

Also under the bank account, have a near-line savings envelope with
sub-envelopes under them -- one per budgetary envelope.

When the bugetary "holding" envelope goes short, the first source
of underflow comes from it's corresponding near-line savings
envelope.  Have the near-line savings envelopes have caps; at which
time, the program should prompt the user to migrate the overflow
into a deep (external) savings account.

You can let it be the user's decision to use the near-line savings as
the envelope's underflow response or to re-allocate from it's
companion envelopes.

If you do the underflow from the near-line savings, you can easily
measure the "drain-rate" for that particular budgetary envelope;
and look for patterns or what nots.

Also, have an underflow theshold on the near-line savings.
If the near-line savings' undeflow is reached, then prompt the
user to replenish the near-line savings from the deep (external)
account.

What do you think?

-- Tom.

* James LewisMoss <jimdres@mindspring.com> [001121 02:17]:
> 
> OK.  Here's what I have so far in my want list for a budgeting
> system.  I'm still looking for more ideas on what it should do.
> 
> I want my budgeting system ...
> 
> ... to help me make a budget.
> ... to be able to group expense accounts into budget items.
> ... to tell me when I mess up (real time and through reports).
> ... to have a nice report or ten.
> ... to add transactions automatically
> ... to mark transactions as automatically added so I can make sure
> they are ok.
> ... to remind me to add items.
> ... to contain useful info.  (About how to budget and what budgeting
> means.)
> ... to contain useful lists of budgets (examples).
> ... to handle different types of budget items (examples: constant over
> period; one shot; scheduled regularly; scheduled irregularly; etc)
> ... to gracefully handle when I break my budget (help me fix it; mark
> as anomoly; etc)
> ... to handle expense accounts in more than one budget group
> ... to have a report that shows all the particular transactions/splits
> that went into each budget item each month.
> 
> So what do other people want?
> 
> Jim
> 
> -- 
> @James LewisMoss <dres@debian.org>      |  Blessed Be!
> @    http://jimdres.home.mindspring.com |  Linux is kewl!
> @"Argue for your limitations and sure enough, they're yours." Bach
> 
> _______________________________________________
> gnucash-devel mailing list
> gnucash-devel@lists.gnumatic.com
> http://www.gnumatic.com/cgi-bin/mailman/listinfo/gnucash-devel
>