Deleting "Pre-Auth" charges on CC causing issues in budget
So, my wife and I pay off our CC in full all the time (every other day or so based on the pending charges).
One issue we've just discovered is as follows:
1 - We order something online and enter it into the budget (for example - we use a pre-packaged meal prep service and categorize it into our Groceries category).
1a - The company charges it to our CC and it shows up in our statement as "Pending" (as opposed to "Posted", which have been processed and are final).
2 - The budget moves the $50 from the grocery category over into the CC payment category. All good so far.
3 - Later that evening, we realize we don't need as many meals for the week, so we cancel the one order and submit a new one for, say, $40.
4 - I go into the budget and add the new transaction, but leave the old one because I want to make sure it gets properly cancelled by the company, so it's a reminder for me in a day or so.
5 - A few days later I can see the $40 has posted and the $50 has disappeared from the CC statement. Perfect - I can delete the $50 charge because it doesn't exist and there never was a refund because the company never processed that charge.
6 - Now when I look at the CC Payment category, it's short by $50. I check my grocery category and it still shows $500 budgeted with $460 available, so I know that $50 isn't gone from there.
7 - I now have to manually adjust my CC Payment by moving the $50 from To Be Budgeted into CC Payment just so the numbers line up.
Any idea why it's doing this? I know the simple solution is to likely to leave the original charge in the budget until the new one processes and just edit the value, but I've had that cause problems in the past of the same nature (ie - CAD to USD conversion changes between the Pending to Posted dates means I'm out $0.32 even though everything is paid to 0 and no overspends anywhere).
Hi Tan Router !
That definitely sounds odd! If a transaction has been deleted, it shouldn't still affect your credit card category (because it's no longer there). Does this happen every time you delete one of those transactions? If so, the next time it happens, would you be willing to enable Support Access for your account? That will let us take a closer look at things. Once you’ve done that, let me know—and mention whether you’d like to continue the discussion here or via email instead. :)Reply
You didn't mention when you send money to the CC, but you'll have issues if you send it while that $50 transaction is present. If you pay the entire amount in the CC Payment category, the Available will obviously go to $0. When you later delete that charge, the Available will be reduced by $50 (recall, it was increased by $50 when you entered that transaction). This takes the balance negative/red, signifying missing cash. (And it is missing, you sent it to the CC company.
My favorite solution is to not pay the category down to $0 and pay less often (e.g., once a month a few days before it's due). The CC company has only asked you for part of what you owe (i.e., the statement balance). If you've used the card since the statement closed, the Payment Available will be more than they've asked. That way, when you delete that $50 transaction, the Available still drops by $50, but that's not enough to take the category negative.
There are a number of other solutions if you want to continue these micro-payments:
- In #4, edit the transaction, putting "$50 Cancelled" in the memo and $0 in the outflow. This updates the CC Payment category and you'll be less likely to pay an amount that will be "taken back".
- Don't make a payment while a transaction is pending.
- Ignore the error, because your next transaction or two will increase the payment category back into positive territory. (Correct it at the end of the month, though.)