Credit Card Categories Confusion

Hi,

 

I'm still trying to figure out how the credit card categories work.

 

I read through the credit card guides but am having a hard time piecing:

  1. Where did 8.73 come from? I had no transaction in the past few months that are of amount 8.73
  2. If I understand the credit cards correctly, it seems like when we budget (e.g. $30 in groceries), pay $26.98 of groceries in card 1, then:
    1. Card 1 categories should show:
      1. Spending: -26.98
      2. Returns: 0.00
      3. Budgeting Spending: -26.98
      4. Payments and Returns 0
    2. Is that correct?
  3. Yet, I'm having a hard time understanding (in my images above):
    1. What's the difference between the 2 columns though?
    2. What does the amount in the credit card payment represent? Why is it 8.73 and what does that mean? That I have to pay 8.73? Or I'm short or over-paid by 8.73?

 

Thank you!

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  • What is the available number in the category that had the $26.98 spending??  It seems like it wasn’t fully budgeted. 

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  • Hi Violet Saxophone !

    $8.73 is how much you had Available to cover your credit card spending. For instance, if you spent $26.98 on Groceries, but you only had $8.73 Available in your Groceries category, then only that $8.73 would move to your credit card category. The $8.73 is how much you budgeted and can pay towards your credit card. The rest of that $26.98 wasn't budgeted for in your spending categories. If you look at your budget, you should see a yellow or red Available amount - this shows where the overspending took place. If you cover the overspending, then the credit card activity should adjust to show $26.98 as Budgeted Spending.

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  • Your #2 is exactly correct if you had budgeted $30 in Groceries. Indications are that you didn't, though, which is why the full 26.98 didn't move to the CC Payment category.

    As for #3, the left is the impact within the account. It's a summary of transaction amounts without consideration of categories and whether category Available amounts are sufficient. The right is the impact within the budget.

    If the top two lines don't agree, then not all your spending was budgeted. The difference between those two values is the magnitude of the total overspending, and this will be distributed among one or more categories.

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  • Violet Saxophone said:
    What does the amount in the credit card payment represent? Why is it 8.73 and what does that mean? That I have to pay 8.73? Or I'm short or over-paid by 8.73?

    The CC Payment Available column is the amount of cash you hold that is reserved for the purpose of your credit card payment. All categories are like this: for example, the Electric category tells you how much is reserved to pay the Electric bill, etc.

    It means that the most you can send the CC right now is 8.73. This is a potential problem, because your bill is going to be higher than that. (The billed amount is always the account balance on the closing date.)

    I can't tell what your account balance is, but I'd suggest that you move enough money from elsewhere in the budget to the CC Payment category to make it equal the account balance. This means you could pay the entire debt at any time (i.e., "pay in full").

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  • Thanks for the timely and helpful responses.

    Let me try that.

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    • Violet Saxophone Let us know if that doesn't do the trick! :)

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  • As a followup. if the total activity is $180, why is the available amount negative 180?

     

    I'm a bit confused on how to interpret that amount. I'm tempted to reset all amounts to be 0 to balance things out but not sure if that messes things up.

    Help understanding that would be great!

    Thanks!

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    • Violet Saxophone Available is the sum of last month's Available (or $0 if last month's Available was negative), this month's Budgeted, and this month's Activity. Based on that, I'd say you've reallocated at least $360 from that category, resulting in a negative budget entry.

      Reallocating from the CC Payment category effectively says paying off CC debt is less important than everything else that has available funds. Only you can decide if that's true. (If that's not true, then you should take from one of them, instead.) 

      Yes, you should ensure the Available is non-negative, especially if it's red. That is part of Rule 3. Red categories mean one or more other categories are overstated (not entirely backed by cash).

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