Categorizing Emergency Funds Expense
My wife and I have a category for Emergency funds that we contribute to monthly. Last month we had to pay for a car repair out of the emergency fund. What is the best way to do this for data tracking?
We currently will log the expense under car repairs and then transfer the money from the Emergency fund category to the car repair category to balance it out. In this way we can keep track of how much we spend each year in all categories. The only issue here is that there is no record of how much money we have spent out of our emergency fund.
2nd option - log the transaction under emergency fund and be done with it. This flips the above and we now know how much we spent out of emergency fund but do not track the expense under car repairs.
One solution - I dont really want to do this and we have in the past : Have a separate account for emergency fund account. When needing to use it transfer from emergency fund account to operating account and then log the expense under the appropriate category. The transfer entry from the emergency fund account to operating would track the yearly changes in the emergency fund.
* The main reason I dont like doing this, may not be justifiable, is that I prefer all funds to be in one account and YNAB just tell me where everything is. That way I avoid assigning funds to emergency fund each month and then needing to actually transfer the funds. Same for if they were ever needed. Also easier to have a lump sum in one high yield savings account for the interest benefit.
Just curious how everyone else approaches this.