Credit card overspending category (no judgment pls!)

We intentionally put a purchase on a credit card - but we are carrying debt and will not be paying it off this month, as there is a plan in place. (Backstory - newer YNAB users - true expenses aren't funded yet - vet emergency - we put it on the lowest interest rate card, but are avalanching the higher interest rate card first.)

So, my credit cards are linked (checking isn't - I'm doing that one manually), and the payment just showed up. YNAB is asking for a category - how do I categorize it? 

Thanks!

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  • Create a Vet category (if it's not already there) and use that. That's why you spent money.

    Down the road, you'll eventually want to make a larger CC payment (above and beyond what YNAB automatically reserves for budgeted purchases), so budget toward the CC Payment category to enable that. You will be back to paid-in-full status when the CC Payment category will cover the entire account balance.

    Like 1
      • Stacey K.
      • staceychev
      • 5 mths ago
      • Reported - view

      dakinemaui I do already have a Vet category as a true expense and I'm trying to build that up. If I budget money into that category, will it register that as actual money or will it deduct from the credit card overspend? 

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      • jenmas
      • jenmas
      • 5 mths ago
      • 1
      • Reported - view

      Stacey K. Don't budget money you don't have. But enter the expense transaction to the Vet category. It will turn the category available balance negative and if it is still negative at the end of the month, YNAB will convert the negative amount to credit card debt.

      Like 1
      • Catlover
      • Independent Contractor
      • Catlover3
      • 5 mths ago
      • Reported - view

      jenmas 

      I didn't know that. Thanks for sharing! 

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  • jenmas said:
    if it is still negative at the end of the month, YNAB will convert the negative amount to credit card debt

    Viewpoints on this vary. As I see it, it's debt the moment you swipe the card. YNAB will automatically reserve money for budgeted purchases, including retro-actively within the same month. After that, you'll need to budget toward debt reduction if you want to reduce the debt any further.

    Like 2
      • jenmas
      • jenmas
      • 5 mths ago
      • Reported - view

      dakinemaui I don't disagree with you, but as far as explaining the mechanics of what's happening on the screen, you overspend a category it turns red. If you don't fix it by the end of the month, YNAB moves the red for you to your credit card payment category.

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      • WordTenor
      • I'm the oldest and the wittiest.
      • WordTenor
      • 5 mths ago
      • Reported - view

      dakinemaui yeah, I think the problem with explaining it that way is that the entire fundamentals of the CC handling have to be understood first, and unfortunately, the support materials no longer do a good job of teaching that aspect of the software. No doubt it is the most correct way to frame the problem, but it’s easier for most newbies to understand “if you leave a category overspent, it causes an issue at the end of the month” because that’s when you no longer see the overspending. 

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      • dakinemaui
      • dakinemaui
      • 5 mths ago
      • Reported - view

      jenmas That's the thing -- it doesn't move anything to the CC Payment category at the end of the month.  Nor does the debt (i.e., the account balance) change at the end of the month. As far as "on screen", the only thing that actually happens is that the warning is removed when one scrolls to the following month.

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      • dakinemaui
      • dakinemaui
      • 5 mths ago
      • 1
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      WordTenor I think people intuitively understand that swiping the card == new debt, and "the warning goes away" seems simpler than any other explanation. I rather see those as enabling the understanding of the CC handling (rather than requiring), as then newbies are 75% of the way there without challenging any preconceived notions. The only thing to "add on" that is at all unusual is that budgeted purchases ALSO reserve cash to pay that purchase off later. (Well, aside from purchase reward credits, that'll mess with most.) 😄

      jenmas, sorry to have seemingly picked on you. I think I'm just grumpy for other reasons tonight.

      Like 1
      • jenmas
      • jenmas
      • 5 mths ago
      • Reported - view

      dakinemaui no, no, I see what you’re saying. 

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