Realized YNAB CC balance is incorrect, what happens when you reconcile?

Our CCs are on auto-import so honestly I don't pay a lot of attention to seeing if the balances match. After my most recent payment earlier this week, I realized that YNAB CC balance is ~$200 less than what my CC (Chase) website says. I've done some reading and realize you should reconcile accounts often (even if they auto-import) which I had not been doing so I can't say for certain how long the balances have been off. I did look at the past 2 months of transactions and everything seemed to line up so wondering if it's been off for awhile and I just haven't noticed.

Anyways - it seems like the easy/lazy way out is just to reconcile the account with the correct balance per the bank website so that it's accurate moving forward. I did that, and everything was still magically green. So, my question is, what happened to that $200 discrepancy? Where is it pulling that money from to cover that CC balance? Hopefully I'm wording this correctly. Thanks!!

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  • Your credit card debt increased by ~$200. Your budget is comprised of money from cash-based accounts, so changing the balance of a credit card account will not change the money in your budget (unless the account goes positive).

     

    If you are a Pay In Full CC user you will need to budget to pay off the increased debt.

    Like 1
  • I am a pay in full CC user. I thought when I reconciled it (adding ~$200), it would push my "credit card payment" or something in the red. I'll be honest, I feel like I am a "surface user" of YNAB, but just trying to figure out how/where that discrepancy will fit into my budget. I'm not even sure that makes sense... just trying to avoid having it cause a domino effect of issues by just reconciling to the correct balance.

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      • dakinemaui
      • dakinemaui
      • 1 mth ago
      • 2
      • Reported - view

      Slate Gray Leopard The difference was chalked up as additional debt. If you want to maintain PIF status, you will need to reserve (budget) additional money in the CC Payment category directly -- the Available amount needs to cover the entire account balance.

      I'll echo nolesrule 's comment that the budget is the plan for your CASH. That's why nothing happened in the budget when the adjustment transaction increased your CC debt. Now you have to decide whether to restore PIF status or not; if so, then that does impact your cash plans since you can't spend a dollar more than once! 😉

      Like 2
    • Alright, so if I'm understanding correctly, I just need to budget that ~$200ish amount to the "credit card payment" line item for this CC? 

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      • jenmas
      • jenmas
      • 1 mth ago
      • Reported - view

      Slate Gray Leopard to function as a pay in full user, the available amount in your credit card payment category must always equal the working balance of your credit card account (left hand side of your screen), except that the payment category is positive and the account balance is negative.

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    • jenmas good to know - I feel like that is not always the case for ours (though we do always pay our statements in full/haven't had any issues not having funds to do so) so maybe we have some bigger things to sort through...we've done one fresh start ~7 months ago, may be time for a new one and maybe this time we'll actually have CCs fully figured out, ha!

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      • WordTenor
      • I'm the oldest and the wittiest.
      • WordTenor
      • 1 mth ago
      • 4
      • Reported - view

      Slate Gray Leopard If it ever becomes not the case, you just make it the case. There are several reasons why the category might get out of step with the card balance but the fix is always the same—you budget whatever you need to budget to make them equal. 

      Like 4
  • Hmm, okay. I guess I need to do some more reading on this as it doesn't totally make sense to me as to why the 2 wouldn't align if they're supposed to. We have our cards on auto-import and just categorize transactions as they come in. All of our CCs are on auto-payment and haven't had an issue where the CC payment lines have turned red/orange. Like I said, definitely a "surface level" user so clearly need to do some more reading!

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      • jenmas
      • jenmas
      • 1 mth ago
      • 1
      • Reported - view

      Slate Gray Leopard If you look through these forums, there are multiple reasons why they would not match. The most common reason is not budgeting for existing balance properly when setting up the credit card in YNAB. But statement credits, returns in a month different than the purchase and a few other things can impact it as well. Another common issue is being on the credit card float. People on the float pay their balance in full and never incur any interest so they don't consider themselves to have credit card debt. But they are only able to do that because they received income between the date of purchase and the date that the credit card is paid. I don't have any credit card payments due until Feb 7 or so. I will receive one more paycheck before then and one paycheck on the 7th. But none of that matters to my existing credit card balances. I could pay them all down to 0 right now with absolutely no impact on my budget. That's paid in full.

      Like 1
    • jenmas Yep - incorrect starting balances is what threw us off the first time. And worked through CC float as well so we budget for the month or two ahead now. I didn't realize the return piece - that could definitely be it especially with the holidays. I'll dig into this further this weekend. Thank you again, appreciate the insight! 

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    • Slate Gray Leopard It's how those transactions interact with the budget that matters. For example, the #1 cause is overspending. Without any funds available in a category, none will be moved to the CC Payment category. Anything categorized as TBB will mandate an adjustment (e.g., purchase rewards issued as a statement credit). Same thing with outgoing transfers (e.g., immediate reimbursements).

      In short, YNAB's CC handling does not attempt to maintain the post-payment debt -- a serious design flaw, IMHO. That means that you have to be vigilant if you are using it.

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    • dakinemaui right, I think I get it. We are pretty vigilant about having enough $ in the categories before putting them on a CC, or moving $ from one category to another to cover overspending. I'll do some digging into the returns and see if I can ID any other discrepancies. And do some more reading to see what has worked well for others. Appreciate the help! 

      Like 1
    • Slate Gray Leopard A number of PIF users who have grown weary of babysitting their Payment category represent their CCs with checking accounts. This ALWAYS keeps an amount equal to the entire account balance implicitly reserved. There's no Payment category, so it can't possibly get out of sync.

      Obviously, this is not suitable if someone needs to temporarily finance something or ride the CC float, but it's easy to balance transfer to a real CC account in such cases until PIF status is restored.

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