Overspend when moving money between on budget credit lines

I think this could be a bug.

You have two lines of credit : credit 1 and credit 2 with 0 starting balance

Register $500 transaction on credit 1 as "Transfert:Credit 2" to move the money between lines of credit.

There is $500 of to be budgeted money. That's normal, since you borrow money from credit 1.

Put the $500 on the credit 1 budget that way the payment will cover the expense. (see capture 1)

But, in the credit 1 account, YNAB displays an $500 overspend. (see capture 2)

I don't understand. There is no overspending in that case, since this is moving money between two on budget accounts.

PS: the problem still exist if the destination account is not a credit line. The problem occurs because the source is a credit one.

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    • nolesrule
    • YNAB4 Evangelist
    • nolesrule
    • 7 days ago
    • 1
    • Reported - view

    It's because there is no category on the transfer, so you are technically overspending via cash advance. You balance it out by adjusting the budget, but there's no way to negate the overspent transaction.

    Reply Like 1
    • nolesrule I don't understand why this is overspending since this is not a spending at all. I still own the money since the target account is on budget.

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      • HappyDance
      • YNABing consistently since 2014
      • HappyDance
      • 7 days ago
      • Reported - view

      Hot Pink Trumpet 

      Because their hockey puck; their rules.

      I didn't like it either. It didn't make sense to me. I don't define cc transactions as debt UNLESS I don't pay them off in their statement period. nYNAB defines every cc transaction as taking on debt the moment it occurs, and you have to jump through hoops to adjust for transfers between accounts that involve a cc as if they were cash advances. (I won't get into returns and rewards issues.)

      I found it endlessly frustrating to deal with a single monthly gift card purchase, using a cc because I was buying it online, where I wanted to track the gift card in an onbudget account.  (All my other gift cards were always purchased on the same day only using my chequing account, and they were straight transfers.) I couldn't make sense of it in the beginning. I kept having to do fresh starts. Tears and gnashing of teeth occurred.

      I redefined all my cc as chequing accounts. This eliminated the problem for me.  I never carry a balance. I never take a cash advance. As a bonus, doing this gave me back the 25% of my computer screen that was previously filled with cc payment categories.

       

      Disclaimer: redefining your cc accounts as chequing accounts is not recommended if you carry balances and are slowly paying off debt.

      Reply Like
    • HappyDance I can see your vision. I like very much how debt are handled into the nYNAB but can understand that for some case, it could be overwelming. Like you said, one can still choose to handle CC as checking account. For my issue, I just not understand how moving money from credit into an on budget account is handled. IMHO, no overspending should be displayed since is not even a spending.

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      • jenmas
      • jenmas
      • 6 days ago
      • 2
      • Reported - view

      Hot Pink Trumpet YNAB doesn't treat credit cards like it treats checking/current or savings accounts. It is treating the transfer as if it is a cash advance and a cash advance on a credit card is spending and on most US cards immediately incurs interest rather than waiting until the payment is past due. I understand your frustration - I have on on budget gift card category and when I buy gift cards with a credit card, it requires more fiddling around on the budget page than I think should be necessary, but those are the facts on the ground.

      Reply Like 2
  • Hi Hot Pink Trumpet ,

    HappyDance  , nolesrule and jenmas are right that any transfers made from a credit card account are treated as cash advances in YNAB. 

    When you transfer money out of your credit card account you're essentially borrowing cash. It's new money in your budget that needs to be budgeted.

    It shows up as overspending (debt on the card that isn't budgeted for) in your account register and money is added to your To be Budgeted amount (and consequently to your Funds for [Current Month] number). 

    Since you likely didn't want to incur debt when this happened, you'll want to budget the amount of the transfer to the Credit Card payment category so you have that money available for your eventual payment. 

    That overspending alert in the Credit Card Payment category will remain through the month, but that will clear out when the next month begins. With no other overspending you can think of that alert as an indication that there was a cash transfer out of the account this month.

    I hear you on not loving this workflow! I've sent your feedback to our Design team–they review every bit of feedback just about every week. 

    Let me know if you have any questions! Thanks for helping us improve YNAB!

    -Elena

    Reply Like
    • Elena THank you for your reply. I will see that as an alert. But if I actually have real overspending (spending without any budget for it) this alert will lead to a wrong sum alert this month. 

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