Credit Card Use-Not Paid In Full?

Greetings,

I have a use question. If I make a purchase and fully intend NOT to pay it off in full in one month with available funds, what its the standard way of doing this?

Example: I make a purchase now that I am will to sink say 6 months of payment into, and I know I can afford it. I make the purchase it comes through and YNAB ask to allocate funds. What if I don't want to ? :) I get the whole every dollar has a job rule, and I have got up to about about 42 day age of money.

I am kinda new so I hate yellow and strive to keep goals green.

Thanks!

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  • To finance a purchase, leaves it overspent/yellow or cover from the CC Payment category to cancel the yellow warning. Either will cause a gap between CC category and the account balance (switching to non-paid-in-full status).

    Over the next 6 months, just budget to narrow the gap. Set a CC Payoff Goal if you want help staying on track.

    Like 1
    • dakinemaui Thank you... So basically you just have to take the hit on the greens for the month for that category. I guess I can live with that.

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    • Purple Lion Personally, I would turn off the yellow/credit overspending warning if this was an intentional choice to finance. No need to nag me the rest of the month.

      To deactivate the warning for $X of overspending, reduce the budget value on the CC Payment category by $X (possibly going negative) and increase the budget value on the overspent category by $X. The built-in calculator makes this easy.

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    • dakinemaui Perfect Thanks I will try that.

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  • Purple Lion said:
    I make a purchase now that I am will to sink say 6 months of payment into, and I know I can afford it.

     

    Purple Lion said:
    I make the purchase it comes through and YNAB ask to allocate funds. What if I don't want to ?

     These two sentences, which were next to each other in your post, do not really work together. How do you know you can afford it if you don't have money allocated for the purchase?

     

    If you really can afford it, allocate the money now, but don't pay it now.

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    • nolesrule I see what you are saying, but it is not exactly what I meant. I mean I am comfortable having a new reoccurring bill for say 6 months in my example.

      The way I see it is like this. I can set aside X amount of dollars to cover a purchase over time OR I can make the purchase and pay it over time, sometimes you just want your new toy now :) I am not new to credit, I use credit monitoring and have managed to get my rating over 800. ( Actually 850 on at least one agency ).

      Basically the same result, Save over time or pay over time . 

      YNAB so far in my limited use of the platform wants me to pay every purchase upfront, Which is is great for most things, but not if I actually want to use my credit.

      Using credit responsibly is not a bad thing.

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      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 3 wk ago
      • Reported - view

      Purple Lion nah, it's not the same thing. One is rearranging what you have now to cover it even if the payments are in the future. The other is assuming you will have future income to make those payments. 

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    • nolesrule Ok, I don't think you know what I was asking. I appreciate your input though. I think we all make some assumptions on future income otherwise, why even budget. I have Netflix, amazon, hulu etc. I cant pay them all upfront right this moment, I could but they wont let me, they are monthly subscriptions. Do you see where I am going here? Thank you for your time. 

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      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 3 wk ago
      • Reported - view

      Purple Lion the expense is incurred when it's charged to the credit card, not when you pay the credit card. That's true of every expense in your budget, even subscriptions. That includes saving up money now for future expenses, as opposed to saving up in the future for today's expenses. 

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    • nolesrule We are going round and round. I want the expense that i intend NOT to pay in full. That's the point of credit. I don't abuse credit so it is not like I have a ton I need to pay down. I keep most balances low. Dakinemaui had some advice I think I will give a shot. Thank you.

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