New blog post

4 years ago · ec3a3ac1d6
--- a/Gemfile.lock
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@ -55,7 +55,7 @@ DEPENDENCIES
  tzinfo-data

 RUBY VERSION
   ruby 2.4.1p111
   ruby 2.4.4p296

 BUNDLED WITH
   1.14.6
   1.16.1
--- a/_posts/2018-06-12-elbank-ynab.markdown
+++ b/_posts/2018-06-12-elbank-ynab.markdown
@ -0,0 +1,167 @@
 ---
 layout: post
 title:  "Using Ledger for YNAB-like envelope budgeting"
 date:   2018-06-12 21:20:00 +0200
 author: Nicolas Petton
 categories: ledger emacs ynab budgeting
 description: "A quick guide to setup Ledger for envelope budgeting"
 ---

 # Bye bye Elbank

 I have to start this post with this: I will not be actively maintaining
 [Elbank](https://github.com/NicolasPetton/elbank) anymore, simply because I
 switched back to [Ledger](https://www.ledger-cli.org/).  If someone wants to
 take over, please contact me!

 The main reason for switching is budgeting.  While Elbank was a cool experiment,
 it is not an accounting software, and inherently lacks support for powerful
 budgeting.  

 When I started working on Elbank as a replacement for Ledger, I was looking for
 a reporting tool within Emacs that would fetch bank transactions automatically,
 so I wouldn't have to enter transactions by hand (this is a seriously tedious
 task, and I grew tired of doing it after roughly two years, and finally gave up).

 Since then, I learned about ledger-autosync and boobank, which I use to sync my
 bank statements with Ledger (more about that in another post).

 # YNAB's way of budgeting

 I only came across [YNAB](https://ynab.com) recently.  While I won't use their
 software (being a non-free web application, and, you know... there's no `M-x
 ynab`), I think that the principles behind it are really appealing for personal
 budgeting. I encourage you to [read more about
 it](https://www.youneedabudget.com/method/) (or grab a [copy of the
 book](https://www.youneedabudget.com/book-order-now/), it's great), but here's
 the idea.

 1. **Budget every euro**: Quite simple once you get it. Every single Euro you have
   should be in a budget envelope. You should assign a job to every Euro you
   earn (that's called
   [zero-based](https://en.wikipedia.org/wiki/Zero-based_budgeting), [envelope
   system](https://en.wikipedia.org/wiki/Envelope_system)).
   
 2. **Embrace your true expenses**: Plan for larger and less frequent expenses, so
   when a yearly bill arrives, or your car breaks down, you'll be covered.
   
 3. **Roll with the punches**: Address overspending as it happens by taking money
   overspent from another envelope.  As long as you keep budgeting, you're
   succeeding.
   
 4. **Age your money**: Spend less than you earn, so your money stays in the bank
   account longer.  As you do that, the age of your money will grow, and once
   you reach the goal of spending money that is at least one month old, you
   won't worry about that next bill.
   
 # Implementation in Ledger

 I assume that you are familiar with Ledger, but if not I recommend reading its
 great
 [introduction](https://www.ledger-cli.org/3.0/doc/ledger3.html#Introduction-to-Ledger)
 and [tutorial](https://www.ledger-cli.org/3.0/doc/ledger3.html#Ledger-Tutorial).

 The implementation in Ledger uses plain double-entry accounting.  I took most of
 it from
 [Sacha](http://sachachua.com/blog/2014/11/keeping-financial-score-ledger/), with
 some minor differences.

 ## Budgeting new money

 After each income transaction, I budget the new money:

 ```
 2018-06-12 Employer
    Assets:Bank:Checking                        1600.00 EUR
    Income:Salary                              -1600.00 EUR

 2018-06-12 Budget
    [Assets:Budget:Food]                         400.00 EUR
    [Assets:Budget:Rent]                         600.00 EUR
    [Assets:Budget:Utilities]                    600.00 EUR
    [Equity:Budget]                            -1600.00 EUR
 ```

 Did you notice the square brackets around the accounts of the budget
 transaction? It's a feature Ledger calls [virtual
 postings](https://www.ledger-cli.org/3.0/doc/ledger3.html#Virtual-postings). These
 postings are not considered real, and won't be present in any report that uses
 the `--real` flag.  This is exactly what we want, since it's a budget allocation
 and not a "real" transaction.  Therefore we'll use the `--real` flag for all
 reports except for our budget report.

 ## Automatically crediting budget accounts when spending money

 Next, we need to credit the budget accounts each time we spend money.  Ledger
 has another neat feature called [automated
 transactions](https://www.ledger-cli.org/3.0/doc/ledger3.html#Automated-Transactions)
 for this:

 ```
 = /Expenses/
    [Assets:Budget:Unbudgeted]                    -1.0
    [Equity:Budget]                                1.0

 = /Expenses:Food/
    [Assets:Budget:Food]                          -1.0
    [Assets:Budget:Unbudgeted]                     1.0
 	
 = /Expenses:Rent/
    [Assets:Budget:Rent]                          -1.0
    [Assets:Budget:Unbudgeted]                     1.0
 	
 = /Expenses:Utilities/
    [Assets:Budget:Utilities]                     -1.0
    [Assets:Budget:Unbudgeted]                     1.0
 ```

 Every expense is taken out of the `Assets:Budget:Unbudgeted` account by default.

 This forces me to budget properly, as `Assets:Budget:Unbudgeted` should always
 be 0 (if it is not the case I immediately know that there is something wrong
 going on).

 All other automatic transactions take money out of the
 `Assets:Budget:Unbudgeted` account instead of `Equity:Budget` account.

 ## A Budget report

 This is the final piece of the puzzle.  Here's the budget report command:

 ```
 ledger --empty -S -T -f ledger.dat bal ^assets:budget
 ```

 If we have the following transactions:

 ```
 2018/06/12 Groceries store
    Expenses:Food                                123.00 EUR
    Assets:Bank:Checking

 2018/06/12 Landlord
    Expenses:Rent                                600.00 EUR
    Assets:Bank:Checking

 2018/06/12 Internet provider
    Expenses:Utilities:Internet                   40.00 EUR
    Assets:Bank:Checking
 ```

 Here's what the report looks like:

 ```
          837.00 EUR  Assets:Budget
          560.00 EUR    Utilities
          277.00 EUR    Food
                   0    Rent
                   0    Unbudgeted
 --------------------
          837.00 EUR
 ```

 # Conclusion

 Ledger is amazingly powerful, and provides a great framework for YNAB-like
 budgeting.  In a future post I'll explain how I automatically import my bank
 transactions using a mix of `ledger-autosync` and `weboob`.
--- a/_site/feed.xml
+++ b/_site/feed.xml
@ -1,5 +1,169 @@
 <?xml version="1.0" encoding="utf-8"?><feed xmlns="http://www.w3.org/2005/Atom" ><generator uri="https://jekyllrb.com/" version="3.5.1">Jekyll</generator><link href="https://emacs.cafe/feed.xml" rel="self" type="application/atom+xml" /><link href="https://emacs.cafe/" rel="alternate" type="text/html" /><updated>2017-11-30T14:28:48+01:00</updated><id>https://emacs.cafe/</id><title type="html">Emacs café</title><subtitle>A blog about Emacs, mostly focused on JavaScript development, by Nicolas Petton.
 </subtitle><entry><title type="html">Introducing Elbank</title><link href="https://emacs.cafe/elbank/emacs/2017/11/30/elbank-intro.html" rel="alternate" type="text/html" title="Introducing Elbank" /><published>2017-11-30T14:28:00+01:00</published><updated>2017-11-30T14:28:00+01:00</updated><id>https://emacs.cafe/elbank/emacs/2017/11/30/elbank-intro</id><content type="html" xml:base="https://emacs.cafe/elbank/emacs/2017/11/30/elbank-intro.html">&lt;p&gt;&lt;a href=&quot;https://github.com/NicolasPetton/elbank&quot;&gt;Elbank&lt;/a&gt; is a new Emacs package I’ve
 <?xml version="1.0" encoding="utf-8"?><feed xmlns="http://www.w3.org/2005/Atom" ><generator uri="https://jekyllrb.com/" version="3.5.1">Jekyll</generator><link href="https://emacs.cafe/feed.xml" rel="self" type="application/atom+xml" /><link href="https://emacs.cafe/" rel="alternate" type="text/html" /><updated>2018-06-12T21:24:33+02:00</updated><id>https://emacs.cafe/</id><title type="html">Emacs café</title><subtitle>A blog about Emacs, mostly focused on JavaScript development, by Nicolas Petton.
 </subtitle><entry><title type="html">Using Ledger for YNAB-like envelope budgeting</title><link href="https://emacs.cafe/ledger/emacs/ynab/budgeting/2018/06/12/elbank-ynab.html" rel="alternate" type="text/html" title="Using Ledger for YNAB-like envelope budgeting" /><published>2018-06-12T21:20:00+02:00</published><updated>2018-06-12T21:20:00+02:00</updated><id>https://emacs.cafe/ledger/emacs/ynab/budgeting/2018/06/12/elbank-ynab</id><content type="html" xml:base="https://emacs.cafe/ledger/emacs/ynab/budgeting/2018/06/12/elbank-ynab.html">&lt;h1 id=&quot;bye-bye-elbank&quot;&gt;Bye bye Elbank&lt;/h1&gt;

 &lt;p&gt;I have to start this post with this: I will not be actively maintaining
 &lt;a href=&quot;https://github.com/NicolasPetton/elbank&quot;&gt;Elbank&lt;/a&gt; anymore, simply because I
 switched back to &lt;a href=&quot;https://www.ledger-cli.org/&quot;&gt;Ledger&lt;/a&gt;.  If someone wants to
 take over, please contact me!&lt;/p&gt;

 &lt;p&gt;The main reason for switching is budgeting.  While Elbank was a cool experiment,
 it is not an accounting software, and inherently lacks support for powerful
 budgeting.&lt;/p&gt;

 &lt;p&gt;When I started working on Elbank as a replacement for Ledger, I was looking for
 a reporting tool within Emacs that would fetch bank transactions automatically,
 so I wouldn’t have to enter transactions by hand (this is a seriously tedious
 task, and I grew tired of doing it after roughly two years, and finally gave up).&lt;/p&gt;

 &lt;p&gt;Since then, I learned about ledger-autosync and boobank, which I use to sync my
 bank statements with Ledger (more about that in another post).&lt;/p&gt;

 &lt;h1 id=&quot;ynabs-way-of-budgeting&quot;&gt;YNAB’s way of budgeting&lt;/h1&gt;

 &lt;p&gt;I only came across &lt;a href=&quot;https://ynab.com&quot;&gt;YNAB&lt;/a&gt; recently.  While I won’t use their
 software (being a non-free web application, and, you know… there’s no &lt;code class=&quot;highlighter-rouge&quot;&gt;M-x
 ynab&lt;/code&gt;), I think that the principles behind it are really appealing for personal
 budgeting. I encourage you to &lt;a href=&quot;https://www.youneedabudget.com/method/&quot;&gt;read more about
 it&lt;/a&gt; (or grab a &lt;a href=&quot;https://www.youneedabudget.com/book-order-now/&quot;&gt;copy of the
 book&lt;/a&gt;, it’s great), but here’s
 the idea.&lt;/p&gt;

 &lt;ol&gt;
  &lt;li&gt;
    &lt;p&gt;&lt;strong&gt;Budget every euro&lt;/strong&gt;: Quite simple once you get it. Every single Euro you have
 should be in a budget envelope. You should assign a job to every Euro you
 earn (that’s called
 &lt;a href=&quot;https://en.wikipedia.org/wiki/Zero-based_budgeting&quot;&gt;zero-based&lt;/a&gt;, &lt;a href=&quot;https://en.wikipedia.org/wiki/Envelope_system&quot;&gt;envelope
 system&lt;/a&gt;).&lt;/p&gt;
  &lt;/li&gt;
  &lt;li&gt;
    &lt;p&gt;&lt;strong&gt;Embrace your true expenses&lt;/strong&gt;: Plan for larger and less frequent expenses, so
 when a yearly bill arrives, or your car breaks down, you’ll be covered.&lt;/p&gt;
  &lt;/li&gt;
  &lt;li&gt;
    &lt;p&gt;&lt;strong&gt;Roll with the punches&lt;/strong&gt;: Address overspending as it happens by taking money
 overspent from another envelope.  As long as you keep budgeting, you’re
 succeeding.&lt;/p&gt;
  &lt;/li&gt;
  &lt;li&gt;
    &lt;p&gt;&lt;strong&gt;Age your money&lt;/strong&gt;: Spend less than you earn, so your money stays in the bank
 account longer.  As you do that, the age of your money will grow, and once
 you reach the goal of spending money that is at least one month old, you
 won’t worry about that next bill.&lt;/p&gt;
  &lt;/li&gt;
 &lt;/ol&gt;

 &lt;h1 id=&quot;implementation-in-ledger&quot;&gt;Implementation in Ledger&lt;/h1&gt;

 &lt;p&gt;I assume that you are familiar with Ledger, but if not I recommend reading its
 great
 &lt;a href=&quot;https://www.ledger-cli.org/3.0/doc/ledger3.html#Introduction-to-Ledger&quot;&gt;introduction&lt;/a&gt;
 and &lt;a href=&quot;https://www.ledger-cli.org/3.0/doc/ledger3.html#Ledger-Tutorial&quot;&gt;tutorial&lt;/a&gt;.&lt;/p&gt;

 &lt;p&gt;The implementation in Ledger uses plain double-entry accounting.  I took most of
 it from
 &lt;a href=&quot;http://sachachua.com/blog/2014/11/keeping-financial-score-ledger/&quot;&gt;Sacha&lt;/a&gt;, with
 some minor differences.&lt;/p&gt;

 &lt;h2 id=&quot;budgeting-new-money&quot;&gt;Budgeting new money&lt;/h2&gt;

 &lt;p&gt;After each income transaction, I budget the new money:&lt;/p&gt;

 &lt;div class=&quot;highlighter-rouge&quot;&gt;&lt;pre class=&quot;highlight&quot;&gt;&lt;code&gt;2018-06-12 Employer
    Assets:Bank:Checking                        1600.00 EUR
    Income:Salary                              -1600.00 EUR

 2018-06-12 Budget
    [Assets:Budget:Food]                         400.00 EUR
    [Assets:Budget:Rent]                         600.00 EUR
    [Assets:Budget:Utilities]                    600.00 EUR
    [Equity:Budget]                            -1600.00 EUR
 &lt;/code&gt;&lt;/pre&gt;
 &lt;/div&gt;

 &lt;p&gt;Did you notice the square brackets around the accounts of the budget
 transaction? It’s a feature Ledger calls &lt;a href=&quot;https://www.ledger-cli.org/3.0/doc/ledger3.html#Virtual-postings&quot;&gt;virtual
 postings&lt;/a&gt;. These
 postings are not considered real, and won’t be present in any report that uses
 the &lt;code class=&quot;highlighter-rouge&quot;&gt;--real&lt;/code&gt; flag.  This is exactly what we want, since it’s a budget allocation
 and not a “real” transaction.  Therefore we’ll use the &lt;code class=&quot;highlighter-rouge&quot;&gt;--real&lt;/code&gt; flag for all
 reports except for our budget report.&lt;/p&gt;

 &lt;h2 id=&quot;automatically-crediting-budget-accounts-when-spending-money&quot;&gt;Automatically crediting budget accounts when spending money&lt;/h2&gt;

 &lt;p&gt;Next, we need to credit the budget accounts each time we spend money.  Ledger
 has another neat feature called &lt;a href=&quot;https://www.ledger-cli.org/3.0/doc/ledger3.html#Automated-Transactions&quot;&gt;automated
 transactions&lt;/a&gt;
 for this:&lt;/p&gt;

 &lt;div class=&quot;highlighter-rouge&quot;&gt;&lt;pre class=&quot;highlight&quot;&gt;&lt;code&gt;= /Expenses/
    [Assets:Budget:Unbudgeted]                    -1.0
    [Equity:Budget]                                1.0

 = /Expenses:Food/
    [Assets:Budget:Food]                          -1.0
    [Assets:Budget:Unbudgeted]                     1.0
 	
 = /Expenses:Rent/
    [Assets:Budget:Rent]                          -1.0
    [Assets:Budget:Unbudgeted]                     1.0
 	
 = /Expenses:Utilities/
    [Assets:Budget:Utilities]                     -1.0
    [Assets:Budget:Unbudgeted]                     1.0
 &lt;/code&gt;&lt;/pre&gt;
 &lt;/div&gt;

 &lt;p&gt;Every expense is taken out of the &lt;code class=&quot;highlighter-rouge&quot;&gt;Assets:Budget:Unbudgeted&lt;/code&gt; account by default.&lt;/p&gt;

 &lt;p&gt;This forces me to budget properly, as &lt;code class=&quot;highlighter-rouge&quot;&gt;Assets:Budget:Unbudgeted&lt;/code&gt; should always
 be 0 (if it is not the case I immediately know that there is something wrong
 going on).&lt;/p&gt;

 &lt;p&gt;All other automatic transactions take money out of the
 &lt;code class=&quot;highlighter-rouge&quot;&gt;Assets:Budget:Unbudgeted&lt;/code&gt; account instead of &lt;code class=&quot;highlighter-rouge&quot;&gt;Equity:Budget&lt;/code&gt; account.&lt;/p&gt;

 &lt;h2 id=&quot;a-budget-report&quot;&gt;A Budget report&lt;/h2&gt;

 &lt;p&gt;This is the final piece of the puzzle.  Here’s the budget report command:&lt;/p&gt;

 &lt;div class=&quot;highlighter-rouge&quot;&gt;&lt;pre class=&quot;highlight&quot;&gt;&lt;code&gt;ledger --empty -S -T -f ledger.dat bal ^assets:budget
 &lt;/code&gt;&lt;/pre&gt;
 &lt;/div&gt;

 &lt;p&gt;If we have the following transactions:&lt;/p&gt;

 &lt;div class=&quot;highlighter-rouge&quot;&gt;&lt;pre class=&quot;highlight&quot;&gt;&lt;code&gt;2018/06/12 Groceries store
    Expenses:Food                                123.00 EUR
    Assets:Bank:Checking

 2018/06/12 Landlord
    Expenses:Rent                                600.00 EUR
    Assets:Bank:Checking

 2018/06/12 Internet provider
    Expenses:Utilities:Internet                   40.00 EUR
    Assets:Bank:Checking
 &lt;/code&gt;&lt;/pre&gt;
 &lt;/div&gt;

 &lt;p&gt;Here’s what the report looks like:&lt;/p&gt;

 &lt;div class=&quot;highlighter-rouge&quot;&gt;&lt;pre class=&quot;highlight&quot;&gt;&lt;code&gt;          837.00 EUR  Assets:Budget
          560.00 EUR    Utilities
          277.00 EUR    Food
                   0    Rent
                   0    Unbudgeted
 --------------------
          837.00 EUR
 &lt;/code&gt;&lt;/pre&gt;
 &lt;/div&gt;

 &lt;h1 id=&quot;conclusion&quot;&gt;Conclusion&lt;/h1&gt;

 &lt;p&gt;Ledger is amazingly powerful, and provides a great framework for YNAB-like
 budgeting.  In a future post I’ll explain how I automatically import my bank
 transactions using a mix of &lt;code class=&quot;highlighter-rouge&quot;&gt;ledger-autosync&lt;/code&gt; and &lt;code class=&quot;highlighter-rouge&quot;&gt;weboob&lt;/code&gt;.&lt;/p&gt;</content><author><name>Nicolas Petton</name></author><summary type="html">Bye bye Elbank</summary></entry><entry><title type="html">Introducing Elbank</title><link href="https://emacs.cafe/elbank/emacs/2017/11/30/elbank-intro.html" rel="alternate" type="text/html" title="Introducing Elbank" /><published>2017-11-30T14:28:00+01:00</published><updated>2017-11-30T14:28:00+01:00</updated><id>https://emacs.cafe/elbank/emacs/2017/11/30/elbank-intro</id><content type="html" xml:base="https://emacs.cafe/elbank/emacs/2017/11/30/elbank-intro.html">&lt;p&gt;&lt;a href=&quot;https://github.com/NicolasPetton/elbank&quot;&gt;Elbank&lt;/a&gt; is a new Emacs package I’ve
 been working on lately. It’s a &lt;em&gt;personal finances&lt;/em&gt; and &lt;em&gt;budgeting&lt;/em&gt; package for
 Emacs that uses &lt;a href=&quot;https://weboob.org&quot;&gt;Weboob&lt;/a&gt; for scraping data from bank
 websites.&lt;/p&gt;
@ -1197,19 +1361,4 @@ project.&lt;/p&gt;

 &lt;p&gt;We still have a lot to explore like linting, getting good auto-completion, using
 snippets, setting up a REPL and debugger, etc. but I promised I would keep posts
 short, so stay tuned for part #2!&lt;/p&gt;</content><author><name>Nicolas Petton</name></author><summary type="html">There’s a lot that can be done to make Emacs a great tool for JavaScript development. So much that I had to split it up into several posts.</summary></entry><entry><title type="html">M-x hello-world</title><link href="https://emacs.cafe/jekyll/update/2017/04/21/hello-world.html" rel="alternate" type="text/html" title="M-x hello-world" /><published>2017-04-21T23:14:09+02:00</published><updated>2017-04-21T23:14:09+02:00</updated><id>https://emacs.cafe/jekyll/update/2017/04/21/hello-world</id><content type="html" xml:base="https://emacs.cafe/jekyll/update/2017/04/21/hello-world.html">&lt;p&gt;All blogs should begin with an introductory post, so here we go.&lt;/p&gt;

 &lt;p&gt;I’ve been willing to make a blog dedicated
 to &lt;a href=&quot;http://gnu.org/software/emacs&quot;&gt;Emacs&lt;/a&gt; for a long time, but until now I
 couldn’t find the right topic.&lt;/p&gt;

 &lt;p&gt;This blog will have a focus on using Emacs as an environment for writing
 JavaScript.  I will talk about Emacs configurations specific to JavaScript and
 packages that make Emacs the great and powerful IDE that it is for web
 development.&lt;/p&gt;

 &lt;p&gt;I’ll try to keep all posts short and to the point, and I’ll most probably post
 tutorial videos from time to time.&lt;/p&gt;

 &lt;p&gt;Topics might sometimes slip a bit from the original focus, but as long as it’s
 about Emacs, I think it’ll be ok.&lt;/p&gt;</content><author><name>Nicolas Petton</name></author><summary type="html">All blogs should begin with an introductory post, so here we go.</summary></entry></feed>
 short, so stay tuned for part #2!&lt;/p&gt;</content><author><name>Nicolas Petton</name></author><summary type="html">There’s a lot that can be done to make Emacs a great tool for JavaScript development. So much that I had to split it up into several posts.</summary></entry></feed>
--- a/_site/index.html
+++ b/_site/index.html
@ -76,6 +76,18 @@

    <ul class="post-list">
        
        <li>
            
            <span class="post-meta">Jun 12, 2018</span>

            <h2>
                <a class="post-link" href="/ledger/emacs/ynab/budgeting/2018/06/12/elbank-ynab.html">Using Ledger for YNAB-like envelope budgeting</a>
            </h2>
            
            <div class="post-desc post-meta">A quick guide to setup Ledger for envelope budgeting</div>
            
        </li>
        
        <li>
            
            <span class="post-meta">Nov 30, 2017</span>
--- a/_site/ledger/emacs/ynab/budgeting/2018/06/12/elbank-ynab.html
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  <header class="post-header">
    <h1 class="post-title" itemprop="name headline">Using Ledger for YNAB-like envelope budgeting</h1>
    <p class="post-meta">
      <time datetime="2018-06-12T21:20:00+02:00" itemprop="datePublished">
        
        Jun 12, 2018
      </time>
      
        • <span itemprop="author" itemscope itemtype="http://schema.org/Person"><span itemprop="name">Nicolas Petton</span></span>
      </p>
  </header>

  <div class="post-content" itemprop="articleBody">
    <h1 id="bye-bye-elbank">Bye bye Elbank</h1>

 <p>I have to start this post with this: I will not be actively maintaining
 <a href="https://github.com/NicolasPetton/elbank">Elbank</a> anymore, simply because I
 switched back to <a href="https://www.ledger-cli.org/">Ledger</a>.  If someone wants to
 take over, please contact me!</p>

 <p>The main reason for switching is budgeting.  While Elbank was a cool experiment,
 it is not an accounting software, and inherently lacks support for powerful
 budgeting.</p>

 <p>When I started working on Elbank as a replacement for Ledger, I was looking for
 a reporting tool within Emacs that would fetch bank transactions automatically,
 so I wouldn’t have to enter transactions by hand (this is a seriously tedious
 task, and I grew tired of doing it after roughly two years, and finally gave up).</p>

 <p>Since then, I learned about ledger-autosync and boobank, which I use to sync my
 bank statements with Ledger (more about that in another post).</p>

 <h1 id="ynabs-way-of-budgeting">YNAB’s way of budgeting</h1>

 <p>I only came across <a href="https://ynab.com">YNAB</a> recently.  While I won’t use their
 software (being a non-free web application, and, you know… there’s no <code class="highlighter-rouge">M-x
 ynab</code>), I think that the principles behind it are really appealing for personal
 budgeting. I encourage you to <a href="https://www.youneedabudget.com/method/">read more about
 it</a> (or grab a <a href="https://www.youneedabudget.com/book-order-now/">copy of the
 book</a>, it’s great), but here’s
 the idea.</p>

 <ol>
  <li>
    <p><strong>Budget every euro</strong>: Quite simple once you get it. Every single Euro you have
 should be in a budget envelope. You should assign a job to every Euro you
 earn (that’s called
 <a href="https://en.wikipedia.org/wiki/Zero-based_budgeting">zero-based</a>, <a href="https://en.wikipedia.org/wiki/Envelope_system">envelope
 system</a>).</p>
  </li>
  <li>
    <p><strong>Embrace your true expenses</strong>: Plan for larger and less frequent expenses, so
 when a yearly bill arrives, or your car breaks down, you’ll be covered.</p>
  </li>
  <li>
    <p><strong>Roll with the punches</strong>: Address overspending as it happens by taking money
 overspent from another envelope.  As long as you keep budgeting, you’re
 succeeding.</p>
  </li>
  <li>
    <p><strong>Age your money</strong>: Spend less than you earn, so your money stays in the bank
 account longer.  As you do that, the age of your money will grow, and once
 you reach the goal of spending money that is at least one month old, you
 won’t worry about that next bill.</p>
  </li>
 </ol>

 <h1 id="implementation-in-ledger">Implementation in Ledger</h1>

 <p>I assume that you are familiar with Ledger, but if not I recommend reading its
 great
 <a href="https://www.ledger-cli.org/3.0/doc/ledger3.html#Introduction-to-Ledger">introduction</a>
 and <a href="https://www.ledger-cli.org/3.0/doc/ledger3.html#Ledger-Tutorial">tutorial</a>.</p>

 <p>The implementation in Ledger uses plain double-entry accounting.  I took most of
 it from
 <a href="http://sachachua.com/blog/2014/11/keeping-financial-score-ledger/">Sacha</a>, with
 some minor differences.</p>

 <h2 id="budgeting-new-money">Budgeting new money</h2>

 <p>After each income transaction, I budget the new money:</p>

 <div class="highlighter-rouge"><pre class="highlight"><code>2018-06-12 Employer
    Assets:Bank:Checking                        1600.00 EUR
    Income:Salary                              -1600.00 EUR

 2018-06-12 Budget
    [Assets:Budget:Food]                         400.00 EUR
    [Assets:Budget:Rent]                         600.00 EUR
    [Assets:Budget:Utilities]                    600.00 EUR
    [Equity:Budget]                            -1600.00 EUR
 </code></pre>
 </div>

 <p>Did you notice the square brackets around the accounts of the budget
 transaction? It’s a feature Ledger calls <a href="https://www.ledger-cli.org/3.0/doc/ledger3.html#Virtual-postings">virtual
 postings</a>. These
 postings are not considered real, and won’t be present in any report that uses
 the <code class="highlighter-rouge">--real</code> flag.  This is exactly what we want, since it’s a budget allocation
 and not a “real” transaction.  Therefore we’ll use the <code class="highlighter-rouge">--real</code> flag for all
 reports except for our budget report.</p>

 <h2 id="automatically-crediting-budget-accounts-when-spending-money">Automatically crediting budget accounts when spending money</h2>

 <p>Next, we need to credit the budget accounts each time we spend money.  Ledger
 has another neat feature called <a href="https://www.ledger-cli.org/3.0/doc/ledger3.html#Automated-Transactions">automated
 transactions</a>
 for this:</p>

 <div class="highlighter-rouge"><pre class="highlight"><code>= /Expenses/
    [Assets:Budget:Unbudgeted]                    -1.0
    [Equity:Budget]                                1.0

 = /Expenses:Food/
    [Assets:Budget:Food]                          -1.0
    [Assets:Budget:Unbudgeted]                     1.0
 	
 = /Expenses:Rent/
    [Assets:Budget:Rent]                          -1.0
    [Assets:Budget:Unbudgeted]                     1.0
 	
 = /Expenses:Utilities/
    [Assets:Budget:Utilities]                     -1.0
    [Assets:Budget:Unbudgeted]                     1.0
 </code></pre>
 </div>

 <p>Every expense is taken out of the <code class="highlighter-rouge">Assets:Budget:Unbudgeted</code> account by default.</p>

 <p>This forces me to budget properly, as <code class="highlighter-rouge">Assets:Budget:Unbudgeted</code> should always
 be 0 (if it is not the case I immediately know that there is something wrong
 going on).</p>

 <p>All other automatic transactions take money out of the
 <code class="highlighter-rouge">Assets:Budget:Unbudgeted</code> account instead of <code class="highlighter-rouge">Equity:Budget</code> account.</p>

 <h2 id="a-budget-report">A Budget report</h2>

 <p>This is the final piece of the puzzle.  Here’s the budget report command:</p>

 <div class="highlighter-rouge"><pre class="highlight"><code>ledger --empty -S -T -f ledger.dat bal ^assets:budget
 </code></pre>
 </div>

 <p>If we have the following transactions:</p>

 <div class="highlighter-rouge"><pre class="highlight"><code>2018/06/12 Groceries store
    Expenses:Food                                123.00 EUR
    Assets:Bank:Checking

 2018/06/12 Landlord
    Expenses:Rent                                600.00 EUR
    Assets:Bank:Checking

 2018/06/12 Internet provider
    Expenses:Utilities:Internet                   40.00 EUR
    Assets:Bank:Checking
 </code></pre>
 </div>

 <p>Here’s what the report looks like:</p>

 <div class="highlighter-rouge"><pre class="highlight"><code>          837.00 EUR  Assets:Budget
          560.00 EUR    Utilities
          277.00 EUR    Food
                   0    Rent
                   0    Unbudgeted
 --------------------
          837.00 EUR
 </code></pre>
 </div>

 <h1 id="conclusion">Conclusion</h1>

 <p>Ledger is amazingly powerful, and provides a great framework for YNAB-like
 budgeting.  In a future post I’ll explain how I automatically import my bank
 transactions using a mix of <code class="highlighter-rouge">ledger-autosync</code> and <code class="highlighter-rouge">weboob</code>.</p>

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