when someone owes you money that will be paid back over time

i am sure this has been dealt with many times but I cannot find what I am looking for

both me and my parents and trialling new YNAB from YNAB 4 so we both have similar situations

How do you track an ongoing debt someone has to you, which will be there across months?

So far what I have tried for me is to put it in as an account with the amount they owe me as a positive balance, and then have budgeted that amount to a category called XY owes me so that the account's balance isn't accidentally looking like I have more money available than I actually have to budget for me. 
Then, if I buy something on their behalf or whatever happens to add to their debt I put in it in as transfer to that XY owes account from the card or account the purchase was made from.
If they buy something for me I put it in as a purchase in that XY owes account and categorise it wherever it should be categorised (groceries etc) so my spending is captured and it reduces the debt.  

So, when they pay me back, or have made a purchase on my behalf, the money would be a transfer from that account back to me, which means the account balance is always an accurate reflection of their debt.
The tricky part is that the money that comes back would then be available to budget, but that will be a very manual process I have to keep track of - which makes me think I am missing something. 
If they do a money transfer to reduce the debt that is easy, but when they purchase something for me that cannot be categorised both a 'groceries' and 'available to budget' 

For my parent's example in YNAB4 it  worked the same, although they are owed a much bigger amount and it involves a line of credit in their name which is used by someone else so there are lots of movements of money. 

The tricky part is ensuring that we don't accidentally think we have more money than we do because their debt is a positive balance. (If we make it a negative then it creates all sorts of other problems, and making the transactions transfers doesn't work)
But also that when we do get a repayment making sure that money is now available to use for other things

Is there a better way to do this in the newYNAB? It was the best we settled on in YNAB 4

--
Between my parents and I we also have each other as an account and track it like this and regularly sit and compare our YNAB owings to each other which go back and forth, but for YNAB 4 I put it in mine as a credit card so the $94 i owed them at the start of this month when I did the fresh start is budgeted for as a credit card payment, which actually captures it all nicely

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  • I’ve been wondering if I should make reimbursements a credit card account

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    • Magenta Vacuum Doesn't work that way. You incur expenses in your actual accounts that must be recorded as outflows there.

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  • Easiest approach is to give $X the job of covering for these missing funds. (Budget to a Whoever Expenses category. $X is enough to keep the category positive.)

    If the category is less than $X, you are owed money. Simple. Record $X in the category name for reference. Or set a Goal.

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  • Make them tracking accounts. When you make a purchase on behalf of someone or give them money, make it a transfer to the Tracking account - you'll get to categorize it, so the funds are removed from your budget, and the Tracking account's positive balance will show how much you're owed.

    Like 2
    • OP, if you do not budget for these expenses, you will have to manually deal with moving funds after reimbursement (usually to the cc payment category).

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    • dakinemaui OP mentioned having the funds in the budget and not wanting to use them elsewhere by mistake, so I took that as them budgeting for the initial expenses.

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    • Til Debt Do Us Part Ah yes, I had missed that part. If things are budgeted, I don't see the need for the added complication of a tracking account. The fact the Available is less than what was budgeted means they're owed money. Plus transfers are a bit of a pain to enter since the Payee field is occupied by the transfer information.

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      • HappyDance
      • YNABing consistently since 2014
      • HappyDance
      • 1 yr ago
      • 2
      • Reported - view

      Hi, Green Boat

      https://docs.youneedabudget.com/article/183-reimbursements

      I use tracking accounts (asset) for loans I make to a family member. I use the same method for personal loans, favours, errands, medical insurance claimables, and office expense reimbursables. 

      Personally, I prefer to pre-fund the category(ies) prior to making any loans and reimbursable expenses. This means I use my own funds and never take on debt to help someone else.  However, the linked article shows you how to carry reimbursable expenses on a credit card as well.

      When the funds leave my budget (purchase/loan), I recorded that as a transfer from the outgoing account to the appropriate tracking account, and I categorize the outflow to the category that makes sense to the transaction: health, reimbursable expenses, emergency fund.  When I receive a repayment or reimbursement, I record a transfer from the corresponding tracking account to the on-budget account receiving the funds: wallet if cash; chequing account if e-transfer or direct deposit, etc

      How I categorize the returning funds:  Sometimes I use Inflow: To Be Budgeted (the funds show up as new income) and sometimes I will categorize the inflow direct to the category so that it doesn't show up as new income and so that it neutralizes the expense.

      The  two methods of categorizing the returning funds:

      1. direct to my reimbursable expense category:  That's the method I use for minor errands and favours, as these tend to be small amounts, of short duration, and quickly repaid in full.
      2. Inflow: To Be Budgeted:  I treat loan payments as income when it's a long-term loan being paid back over many months or years.
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      • Green Boat
      • Green_Boat.1
      • 1 yr ago
      • Reported - view

      dakinemaui 
      we are in australia, so we cant direct import, so the payee field being occupied doesn't matter to us - we are still manually entering every transaction down here :)

      i will read over all the responses again later and have play with it - thanks

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      • Green Boat
      • Green_Boat.1
      • 1 yr ago
      • 1
      • Reported - view

      HappyDance thanks - i will have read of that and play with that option 

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    • Green Boat The faff has nothing to do with import. You have to specify the transfer information in the Payee. That means you cannot specify the payee in the Payee field. It has to go onto the memo if you want it (which I usually do).

      I just find the whole thing awkward, and I don't feel it adds anything when the category is budgeted. The ONLY thing a tracking account provides is the pending reimbursement total, which can also be seen if you set a Goal or simply search for the category in all accounts.

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      • HappyDance
      • YNABing consistently since 2014
      • HappyDance
      • 1 yr ago
      • 1
      • Reported - view

      dakinemaui 

      One thing the tracking account method provided me was the ability to reconcile to zero when I forgave the family loan, and then quietly close that tracking account.. Since the funds had already left the budget when I transferred the funds to my sister,  there was no clean-up required in my budget. It was a very quick and very neat update to deal with a messy situation.

      Like 1
  • [Tried to edit my earlier post and wound up reporting/hiding it instead. Reposting, hope it helps.]

    Easiest approach is to give $X the job of covering for these missing funds. (Budget to a Whoever Expenses category. $X is enough to keep the category positive.)

    If the category is less than $X, you are owed money. Simple. Record $X in the category name for reference. Or set a Goal.

    Like 1
  • I create a far future-dated transaction with the balance owed. Every time I am paid back, I enter the deposit, into whatever category, and a memo that will be usable for searching in case a dispute arises about the outstanding balance. Every time a repayment is made, I subtract it from the original transaction’s amount so it reflects the current balance. 
     

    It’s worked with tracking roommate stuff so far. 

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