Estimates are hard to make, and it’s only natural that sometimes we get them wrong. Spending more than we originally estimated for a given Envelope happens often, but fear not: with Prefund, it is really easy to compensate the overspent amount from another Envelope.
What is Envelope compensation?
With Envelope compensation you can easily redistribute the amounts of your Envelopes without affecting your Budget Total.
Imagine the following scenario. We estimate 80,000 for Housing and 20,000 for Groceries, but then, we spend 90,000 on Housing. This leaves us -10,000 for Housing which has to be compensated somehow. Luckily, even if we spent 10,000 for Groceries, we’ll still have another 10,000 sitting in our Groceries Envelope; which is perfect for covering the overspent amount in Housing.
Instead of increasing the initial amount of Housing from 80,000 to 90,000 (which would also increase our Budget Total from 100,000 to 110,000), we can simply move the surplus 10,000 from Groceries to Housing - leaving us with a clean Budget and untouched Budget Total!
Before compensation
After compensationHow to compensate Envelopes
When an Envelope is overspent, a warning banner will appear on the top of the update Envelope modal. Tap on this banner to start the compensation. As the next step, we can now select which Envelope to compensate from. Simply select the one, and then press Compensate.
Overspent warning
Choose compensator EnvelopeWhat if there are no sufficient funds?
It may happen, that you overspend an Envelope with an amount that cannot be covered by the rest of your Envelopes. In this case, there is no other way than to simply increase the initial amount of the given Envelope. This action however, will increase your Budget Total too.