Back Date Refund?

What is the best method for a refund given in the next month?
I usually back date the refund to the previous month in the category used to originally spend the money. *I reconcile accounts each day and input everything manually.*

I buy something in Dec. with CC, pay statement balance for the month (never the full current balance so I usually have a balance on the cards but never pay interest).

If I get a refund on an item in January, I just backdate the amount to Dec. 31st into the original category used for expense. Make sure accounts are reconciled and move on.

This has worked for me, but I am wondering if this is the best way to tackle a refund posted in a different month?

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  • The recommended method is to budget enough for the initial expense in the first place. Then the credit card payment category isn't underfunded. When the refund comes in, you can then decide whether you need that money in that category or in another category (whichever you want).

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  • I am not underfunded in the category when making purchase.

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  • So why do you need to back date the refund?

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  • Let's say I have $100 for Apparel in Dec. I use $50 to buy some jeans in Dec. I decide to return them in Jan. and get my $50 back. I usually back date the refund to match the month of the expense. 
    So in this scenario, I would back date the refund to Dec. 31st. 

    I'm just wondering if this is how most of you guys do it or if you simply date the refund to its original refund date?

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  • We just use the real date. What's the point on back dating the transaction?

    I don't care how much I spend in a category in a specific month.  I care about the  total or average over a longer period of time, or the trend in time.  Those are unaffected by the date of the transaction.

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  • Keep transaction dates accurate. They tell a story just as much as the other attributes of a transaction. You didn't buy and return it on the same day. You bought it and then days, weeks or months later returned it.

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      • Gironaso
      • gironaso
      • 2 wk ago
      • Reported - view

      nolesrule When I do this, my credit cards amount don't match up for some reason. I have to move money from one CC to another CC for them to equal out to actual balance I owe on the cards.

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      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 2 wk ago
      • 1
      • Reported - view

      Gironaso credit card amount or credit card payment category available balance? I'm guessing it's the latter. You'll need to make adjustments to the payment category. The funds will be elsewhere in your budget, probably in the refund category, or if it took the card positive, the money went into RTA. and it likely has to do with paying the card before the refund.

      Balance transfers between credit cards also require managing the payment categories in the budget.

      Never fudge transactions. Always make budget adjustments.

      Like 1
    • Gironaso Oh, yeah. That's a known bug. You must have had spending from multiple cards in the same category in the same month with a refund. 

      You'll have to just manually keep on top of matching your CC working balances and category available balances. Toolkit has a warning you can turn on. 

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      • Gironaso
      • gironaso
      • 2 wk ago
      • Reported - view

      Move Light Sound Life Yes, we like to use multiple credit cards for points. My wife usually sends me money after the month is over so it's a pain to go back and try to make each CC match with working balances; after overspending has been accounted by YNAB for the month. 

      That is why I've seen that if I back date the reimbursement to the month before, I avoid having to go and find out how to allocate money between cards, essentially the system does it automatically since its "still within the month."
       

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      • Gironaso
      • gironaso
      • 2 wk ago
      • Reported - view

      Move Light Sound Life I have toolkit, what is the function called??

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      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 2 wk ago
      • Reported - view

      Gironaso You should fund the category to the full amount needed for the spend rather than letting it go overspent. Assuming you receive the reimbursement before the next time you make a payment this would only be a one time adjustment to you budget as a whole. If the category has more money in it than you need to fund the spend, you just take out the excess to use elsewhere in the budget.

      If you need to track the reimbursement, there's a savings balance target method and a tracking account method.

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    • Gironaso Toolkit function is PIF (paid in full) CC Assist.

      You could consider joining finances with your wife because that would simplify a lot. 

      However, if you're going to be reimbursing each other, I'd echo the suggestion to prefund a wife reimbursement category. Spending for her would go there, and when she paid you back, it would fill up again for the next month of purchases. Alternatively, you could not prefund it - any time it goes positive, move the money to the CC. However, which one is the question!

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  • Here's what we do:

    1. We use the real date of the transaction because it reflects what we actually have, not what we think we have or what we think we should have had in the past.
       
    2. It's useful for us to see what we spent and what was available by category and when; I don't really care whether there was £100 available in a particular category last month or £10, because this is today (January), a new month, and I can choose to assign the money that I do have to the appropriate categories for today's circumstances. 
       
    3. We think of all income the same way, salary or refund or otherwise, e.g. "hey, I just got some money, what shall we do with it?" .  For us, £50 that we might receive as a refund isn't psychologically linked to where it came from; if we want to put it back in apparel then we do, but our circumstances will likely have changed since the original purchase and we'll probably want to assign it to something else.
       
    4. There is a link between months for assignments, so in our experience changing assignments for categories in the past is fragile and becomes confusing quite quickly.

      For example, assigning or un-assigning money against a category in December also affects the assigned amount in January, so we could find that we've accidentally overallocated or under-allocated today's budget.  One month might not seem that complicated, but what if this process was used across several months?  In the UK, it can take 30-60 days for some refunds to come back, so it's possible that we would have to update 2-3 month's worth of allocations to "fix" the budget if we back-date the transaction several months.

      We felt that this was a lot of effort that didn't bring us much benefit.
       
    5. Back-dating transactions makes it much harder for me to reconcile my accounts - I really don't want to have to hunt and pick transactions and have to figure out what it links to in YNAB.

    Just my two cents...

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  • So after reading the reimbursement guide I understand that I have to categorize the spending back to the original category. Also, if I get the reimbursement that same month then I let YNAB take care of assigning correct amount to each of the CC category payment.

    But if its the next month, then I reimburse it to the correct category in the correct date, then make sure I assign the correct amount to the CC in case there is a different CC payment category amount. 

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