Set Up Credit Cards - Somewhat confused

I'm just learning YNAB from Classic now - transitioning. 

 

I've set up my budget, created my accounts and credit cards with starting balances.  I believe I understand how the credit cards work now, but I don't have any transactions yet to see that play out.  That isn't the problem.  

All my cards have a starting balance.  Three cards show a $0 in the third column, though they have a balance... where I figured there should be a balance that I need to budget for. 

Ex.

Mastercard  ::  $0 :: $0 :: $0 (yellow?) and the balance in the accounts panel is $1145.80

Shouldn't the balance and third column be the same number? 


Another card is where I set the starting balance is showing me the third column as red.  This card has a recent transfer from chequing to pay the previous months balance, that went through after I set the initial balance. 

Ex. 

AMEX :: $0 :: -$2502.16 :: -$2502.16 (Red) and the balance in the accounts panel is 593.99, reflecting the payment to that card did go through.

I'm not sure what to do with this.  I also wonder if maybe I messed up when I was setting up, when I was given three choices about credit cards - one choice was to click "I always pay my balance each month".  Which I do.  Maybe I missed that and clicked some other option when I set up the AMEX?

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  • In YNAB when you first set up your credit cards you have to proactively budget for the starting balance. This is a one time deal. Moving forward, if you use your Visa to buy $43.29 of groceries and the Groceries category has $50 in it, after you enter the transaction in your Visa account register YNAB will move $43.29 out of your Groceries category (reducing available to $6.71) and add that $43.29 to the Visa payment category.

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  • Violet Device said:
    Shouldn't the balance and third column be the same number? 

    Only if you want to be able to pay off the entire debt (paid-in-full status). YNAB assumes you won't, so you'll have to budget if you do. That category is the amount of cash reserved for your payment.

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  • Violet Device said:
    This card has a recent transfer from chequing to pay the previous months balance, that went through after I set the initial balance.

    Adjust the initial balance to the pre-payment amount so the account balance is correct after the recently cleared transfer. Don't forget to budget to reserve money for that payment as mentioned in the previous response.

    Big Picture --- YNAB4 didn't show you how much was reserved for the CC Payment. Instead, it showed you the target debt (a.k.a., Pre-YNAB Debt or PYD), leaving it to you to pay the difference between account and the PYD category balances. Paying strictly this amount would leave the account balance equal to the PYD as desired. One of the big problems was that people didn't know to do this, which was crucial for anyone with nonzero PYD!

    At any rate, if your PYD was $0, then you had enough cash implicitly reserved for your next CC Payment to pay the account to $0 (if you wanted to). You just need to budget that cash toward the payment(s) now that you're using a new tool.

    Paid-in-full status for each product:

    • YNAB4 Pre-YNAB Debt category balance = $0
    • nYNAB CC Payment category = CC account balance as a positive number

    Hope it helps!

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  • Ok... I'm trying that out.  Seems to make sense.

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