Advice needed

Hi Everyone

I pay my credit card off each month, and the payment is taken automatically by direct debit on the 2nd of the month. The problem is, by the time I receive my statement for the next month usually on the 10th, I will have made more purchases. For example, I have £450 on my credit card, but if I set this for my balance, and make more purchases a few days before I receive the statement, those later purchases won't appear on the statement so how can I handle this situation? Hope this makes sense.

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  • The simple answer is: It doesn't matter. If you are making budgeted purchases, YNAB moves the money to the credit card payment category for you so there is always money available to pay the bill (there are ways this can get out of whack related to returns and cash back but for now, we'll just deal with standard purchase and payment). You should look at your credit card payment category on the budget page and compare with the working balance of the credit card under the list of the accounts. If they are the same number (except the account balance is negative and the payment category is positive) you are good to go.

    Example: One of my cards has a statement cycle of the 3rd thru the 2nd with a payment due on the 27th (ie my statement cycle ran from June 3-July 2 and then the payment is due on the 27th). I will absolutely make more charges on the account between July 2 and 27th. However, as long as I pay the statement balance (as opposed to the account balance) in full by July 27, I will not be charged any interest (I am in the US, but I believe that UK cards work essentially the same). I do NOT pay my accounts down to zero (on purpose that is; sometimes if I don't use a card for a while, it will get down to 0). I only ever pay the statement balance by auto pay on the due date (well actually I have it set for 2 days before the due date). All of my cards are set up to pay the statement balance and only the statement balance by the due date. Until the credit card company presents me with a proper invoice (ie monthly statement), they do not get any of my money.

    But at all times, my credit card payment category has enough to pay my credit card account down to 0 if I am so moved. But why should I? I prefer to keep my money in my hands as long as possible.

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  • A way to think about this is that just like every other category, the card payment category shows how much  you have set aside for card payments. It doesn’t obligate you to spend it all on that thing, it just has reserved it. Just like you might go to the grocery store a d not spend every cent in your grocery category, you don’t necessarily (and I would argue should never) send every cent in your card payment category. 

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  • You should always have enough in your payment category to pay the card off.  Do those 2 numbers match for you?

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