Credit Cards (again)
Help me understand what's going on. We have a balance on the credit card. Almost paid off, but we continue to use it and will (probably starting next month) once again be paying it off every cycle. I just finally made the leap from YNAB4 to the online. I think it will help me get on track of living on last month's (or before) paychecks like we want to get to. However, I can't wrap my head around this.
Here's the scenario. I started in November with a "fresh start." My CC debt starting balance was $10,354.15. With the last paychecks this month, I paid $5100 towards the CC. I budgeted that amount (to take it from my "available to be budgeted) and actually sent the payment in (and recorded it as such.)
With me so far?
Meanwhile, we've been doing spending on the credit card (that isn't budgeted yet, but will be with the next paychecks).
I don't understand what YNAB is doing.
So, why does it say I still have $17.35 for the payment? I already paid the $5100. I've since spent $5082.65 on the credit card (that I will be paying soon, but YNAB doesn't know that yet since the money isn't there yet), so why is it subtracting column B (my new spending) from column A (my budgeted and ALREADY SPENT THIS MONTH payment towards old debt) to give me what I should pay? What am I missing? At this point, I do not have the $17.35 to send to the payment, so why is it telling me I do?
Please help me understand what this is doing. I've watched some videos, but I haven't seen anything about what those columns are doing when you are carrying a balance and trying to pay off the old debt.
There must have been $17.35 of purchases that were against a category with available funds. YNAB helpfully gives those dollars the new job of paying your CC bill. (You still have those dollars, of course, but they no longer should be in, say, Groceries, because you now have Groceries.)
Column B is the net of your payment and budgeted spending. Click on that Activity for more details. The Payment is considered negative because it needs to reduce the amount Available in the category.
The CC Payment category defines how much of your cash you have reserved for your next payment. And yes, you do have the $17.35 to send them whenever you like.
No, the $17.35 is simply what I have budgeted to pay (5100) minus what I have spent on the card (which has NOT been budgeted for yet).
If I look at the activity for more details on what I spent, I can see the 5100 that is credited (because of a payment). There is NOT another $17.35 in my checking account to pay more on the bill. The money sitting there in my account at this time has other jobs. Every penny.
I'm so confused...
I'm thinking it has something to do with my saying that 5100 is budgeted in that account? I have to "give the dollars a job" somewhere, but it's messing things up. In YNAB 4 it was "pre YNAB debt" that this would go to....
the $17.35 is simply what I have budgeted to pay (5100) minus what I have spent on the card (which has NOT been budgeted for yet).
I'm afraid the part I bolded is simply incorrect. Positive activity in the CC Payment category comes solely from budgeted purchases -- by definition against a category that has available funds.
Looking at it the other way, make a test transaction for whatever amount against a category with $0 available -- meaning, it's not budgeted for. You'll note the CC Payment category is unchanged. (Delete the test transaction afterward.)
There is NOT another $17.35 in my checking account to pay more on the bill. The money sitting there in my account at this time has other jobs. Every penny.
The budget is comprised of all your cash on hand. So yes, every penny in your account has a job -- including 1735 pennies that have the job of paying your next CC bill.
Those pennies used to have the job of, say, paying for Groceries. Then you took on debt in exchange for groceries (i.e., with a CC purchase). You still have those pennies, though, so YNAB helpfully (automatically) changes the job of those pennies to "Pay off that new debt". They are still in your account, however.
It is true there is not ANOTHER $17.35. It's the same $17.35 that was always there. The amount of cash you have never changed because you used new debt to get the groceries (in this example).
OK, I hear what you're saying but I still don't think it's because I magically have another $17.35 to pay on my card (coming from budgeted items.)
It still looks like this:
I currently have NO categories budgeted (except the CC ) and none have a positive balance since this is I did a fresh start this month.
This is what it looks like if I take out the budgeted CC amount, which is what I would anticipate seeing.
OK, just for giggles I took out my $5100 payment. this is what it shows.
WHERE DID THAT COME FROM???? I have NOTHING budgeted in any category....everything is a big fat zero....Now I'm more confused than ever. How do I find it?