Financial Self-Care with Monarch Money: Understanding Rollovers and Bank Balance Reconciliation

In this blog post, Taylor shares her financial self-care journey using Monarch Money, focusing on monthly budgets, financial planning, and money goals. She invites viewers to subscribe and join her community.

What is a Rollover?

A rollover is the amount of money remaining at the end of one cycle that applies to the next cycle. Cycles can be monthly, weekly, or bi-weekly. Monarch has a built-in rollover feature for expenses only.

Demonstration of Rollover Feature in Monarch

Taylor shows how to roll over leftover money from one month to the next. She turns on the rollover feature for the "Food" category, and the rollover feature appears next to the leftover amount in the "Left to Budget" category.

Customizing Monarch Structure for Bank Balance Rollovers

Taylor explains why she doesn't use the built-in rollover feature. Instead, she uses a different method to reconcile her exact leftover amounts with her bank. She keeps leftover money in one category or in the "Left to Budget" section for easier reconciliation.

Pay Cycles

Taylor explains her pay periods, which are on the 5th and 20th of every month. Her pay periods cover different parts of the month, with a gap of 4 days at the start of the month.

Giving Rollover a Job

Taylor explains the importance of giving rollover a job to cover expenses during the gap period. She gives rollover a job in Monarch by creating categories for rollover from last month, traditional income, expenses, and rollover from this month that applies to next month.

Conclusion

Monarch will understand the cash flow with these four categories. The rollover feature helps to reconcile exact leftover amounts with the bank. Taylor invites viewers to share their own experiences with rollover and to ask questions in the comments.

Reconciling Bank Balance with Monarch Budget

Understanding the Process

Monarch is only a read-only software, and sometimes it takes a while to sync data between the bank and Monarch. Pending transactions in the bank that are not showing up in Monarch can cause discrepancies in the balance. Transfers that have not been accounted for in the budget can also cause issues.

Identifying Discrepancies

Check the "Accounts" tab to compare the bank balance with the "Left to Budget" in Monarch. If the numbers don't match, check all categories to ensure they have zeros. Check for pending transactions in the bank that are not showing up in Monarch. Check transactions for any transfers that have not been accounted for in the budget.

Addressing Discrepancies

Create a placeholder category for transfers to account for them in the budget. Go to Settings > Categories, create a new category, and add the transfer amount. This will reduce the "Left to Budget" by the transfer amount.

Alternative Method

Connect the transfer transaction to a goal to show it on the budget page. Create a manual account for the savings account in Monarch. Go to the "Goals" page, create a goal for the savings account, and add the savings account to the goal. This will show the transfer transaction on the budget page under the goal section.

Conclusion

Reconciling the bank balance with Monarch budget requires understanding the process, identifying discrepancies, and addressing them by creating placeholder categories or connecting transfer transactions to goals. By following these steps, you can ensure that your bank balance matches your Monarch budget.

By regularly reconciling your bank balance with Monarch, you can keep your budget up to date and ensure that every dollar is accounted for.