Unexpected house repair

FYI - not sure if it matters, but I'm using YNAB classic

 

So, I need a new roof. The expense goes way beyond what I budgeted so far for housing expense. So far, I transferred $5000 from a credit card to my checking account. So now, my credit card is at -5000, and my bank account has more.

However, at this point I only have 1000 budgeted for housing repairs. When I write the check to the roofing company (6000), that's going to put my repairs budget to -5000, but my credit card is already at -5000.... I;m going to have to pay down the credit card, but that isn't going to also take card of my housing budget

I don't think I'm doing this right. How do I handle a large new expense that is mostly going on a credit card?

10replies Oldest first
  • Oldest first
  • Newest first
  • Active threads
  • Popular
  • In the card’s pre-YNAB debt category, negative budget -5000. This will add 5000 to ATB, which you can then budget to the house category. 

    Two help docs: 

    https://classic.youneedabudget.com/support/article/managing-new-debt

    https://classic.youneedabudget.com/support/article/paying-off-your-credit-card

    Like
  • I would have worked out the timing better. You pay interest on a credit card cash advance from the moment you draw the funds. I probably would have inquired about a financing option or delayed the cash advance until payment was due. You're probably paying $2.50 to $3.00 per day in interest from the moment you made the draw.

    Many years ago in a previous house, we put a new roof on it. It cost about $4500. The roofing company offered us 0% interest financing for a certain amount of time, with an interest rate lower than a credit card after that. We took the deal and paid it off before we owed a cent in interest. Much cheaper than a cash advance on a credit card.

    Like 1
  • thanks for the help!

     

    in terms of interest, it's not being charged as a cash advance, and I'm getting it interest-free for 12 months (did pay 3% transaction fee) sort of an emergency, otherwise would've planned better (theoretically)

    Like 1
      • jenmas
      • jenmas
      • 2 yrs ago
      • Reported - view

      MadPink So if you just put it on your credit card, why did you do a transfer from your credit card to your checking account? You could have just done a normal transaction in your credit card and did a negative budget from your Pre-YNAB debt category to your home repair category.

      Like
      • nolesrule
      • YNAB4 Evangelist
      • nolesrule
      • 2 yrs ago
      • Reported - view

      MadPink At 3% that's not so bad. Just make sure you pay it off before the 12 months ends.

      Like
  • unfortunately they don't take credit cards

    Like
    • MadPink You could use a service like Plastiq to write them a check while still using your credit card. It costs 2.5%, which ain't nothin', but if you have a good rewards card that will defray the cost while making it less of a crap deal than using a cash advance.

      Like
      • MadPink
      • Coral_Robot.1
      • 2 yrs ago
      • 1
      • Reported - view

      Banana Pancake I was not familiar with them... I am definitely signing up with them

      Like 1
  • What are you thinking is 100% right.

    Like
  • Yes, the costs are really high, I think will be better, if u will change the store or organization that makes repairs. We were in this situation, just found somewhere cheaper

    Like
Like1 Follow
  • Status Answered
  • 1 Likes
  • 6 days agoLast active
  • 10Replies
  • 1474Views
  • 7 Following