Credit Card & Budget Item Doubling Up & General Help

Hi!

I am new to YNAB and am really confused on the best way to work the budget when dealing with credit card transactions.  As an example, let's say I use my credit card to buy $500 for Home Maintenance items.  My credit card is linked so it shows up with $500 outflow.  I tag the category on that credit card outflow transaction as Home Maintenance. 

 

Now when I look at my Budget in the "Activity" column there is a -$500 in the Home Maintenance Category AND -$500 on my Credit Card Category effectively stating that I have a total of -$1,000 activity doubling the transaction. 

 

I was also wondering if someone could please point me to some detailed training/information on how the items at the top are calculated: To Be Budgeted, Funds For the month, Overspent prior month, Budgeted in current month, Budgeted In Future.  I am having a hard time understanding just how much cash I have to work with vs spent vs saved vs not used yet.

 

I have transactions on some accounts that haven't shown up and it has been a week which seems like a ridiculous lag time.  I see a lot of potential with this software but frankly if I can't make sense of how the ins/outs are working and how to effectively manage it then it is useless.

 

Thanks in advance for the help!  Have a great day!  🙂

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  • The activity on the CC Payment category is positive $500. This balances the -$500 in the spending category precisely because the amount of cash you have has not changed.

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      • Mini_M
      • Gold_Vacuum.11
      • 2 mths ago
      • Reported - view

      dakinemaui  You are incorrect, the activity on the CC Payment category is coming through as negative/outflow amount and not a positive amount.  If I change the transaction to a positive/inflow then it ends up adding a positive amount to the activity under the Credit Card AND the spending category, doubling the amount again.  Maybe this is a software bug and it is not working as intended?

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      • dakinemaui
      • dakinemaui
      • 2 mths ago
      • Reported - view

      Mini_M I wonder if you have other transactions included in the CC Activity that are obscuring things? It would be a very serious bug if the net impact of a CC transaction on the budget was not $0.

      Perhaps some screenshots?

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    • Mini_M The number you see in Activity is the sum of any money coming in through purchases, minus any money that's leaving through payments. When you click on the Activity column for the credit card, you'll see a pop up with all the transactions that contribute.

      It's more important to focus on the Available/Payment column. That is the amount you have set aside to pay the credit card company.

      Like 1
  • Mini_M said:
    I have transactions on some accounts that haven't shown up and it has been a week

    Have they cleared at the bank?

    FWIW, the recommended practice is to enter manually and use import as a backup aid to reconciliation. This obviously avoids the lag for the most part, and many who do this feel they are better engaged. Your call, of course.

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      • Mini_M
      • Gold_Vacuum.11
      • 2 mths ago
      • Reported - view

      dakinemaui Yes, the transactions have cleared.  Some accounts seem to be pretty much up to date and others are not.  Is it possible that syncing accounts might work better with some financial institutions than others?

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      • dakinemaui
      • dakinemaui
      • 2 mths ago
      • Reported - view

      Mini_M Some banks are definitely better than others. However, a week is awfully long. You can file an Import Issue using the link on the main support page.

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  • Mini_M said:
    I am having a hard time understanding just how much cash I have to work with vs spent vs saved vs not used yet.

    The bottom line is the money in the budget equals your cash on hand. (That eliminates what you've spent, of course.) If To Be Budgeted is $0, all your cash is in categories, either in the current or a future month.

    The budget IS your spending plan. Shift funds around until the highest priority things are funded.

    I find it simplifies things to think of every category as savings. After all, savings is merely delayed spending. "Not used" is identical to saved, which just means you haven't spent it yet. Until then, money is reserved for various purpose in each category.

    Overspending in the header is last months cash/red overspending. Any red signifies a serious problem, and YNAB attempts to force a correction by reducing this months To Be Budgeted.

    Credit/yellow overspending is only summarized in each account for the current month. As such, it's easy to miss when the month has changed. If your CC has paid-in-full status, overspending will cause the Payment category to be less than the debt (i.e., the account balance).

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  • Another thing you might look at is the Activity Detail by clicking on the CC Payment category Activity value. That has the full details.

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  • Mini_M If you're comfortable posting a screenshot of the credit card activity pop-up, we'd be happy to explain further! I can reach out via email too, if you prefer. 😄

    To answer your other question, this article walks through how the numbers next to To be Budgeted are calculated. Let me know if you have any questions!

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  • I find this default and mandatory (i.e. can't delete) Credit Card Payments category confusing too.  I have already categorized all the in / out transactions on the credit cards and budgeted those individual categories. Why does the  Credit Card Payments category make it seem like the total of the transactions on the card have not been budgeted for? Seems like it's trying to double dip.

    Also I'm doing the payments as Transfers (what YNAB forces as "Payment"). We just use our credit cards for points / cash back and pay them off each month so we just treat them as another account that we transfer money to, we don't carry any debt or have interest to pay off.

    Also maybe of importance is that we're starting fresh in the YNAB web interface as of Aug 1st so maybe the negative starting balance of the credit card at the start of the month contributes to the unbudgeted amount? Though that does not match the negative starting balance (1,247.15) of the card as of Aug 1st. Even that should already be taken care of via the $1800 which actually ended up giving us a credit. Confusing...

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    • Gray Unicorn said:
      maybe of importance is that we're starting fresh in the YNAB web interface as of Aug 1st

      That's usually the cause in my experience. Since the debt on the card as of Aug. 1 didn't come from budgeted purchases -- in the new budget -- money is not reserved to pay that amount off. (YNAB only keeps up with budgeted purchases made while using the budget.) YNAB doesn't assume you'll pay that off, so it's on you to reserve funds to do so.

      There is an additional complication if you take the CC account positive (a credit balance) because that's effectively cash since there's no debt. Since you still have the same amount of cash before & after the payment, the decrease in the payment category (always happens with a transfer to a credit account) must be offset by an increase elsewhere, so YNAB increases TBB. In short, YNAB gives you the funds to cover any overspending caused by a credit balance.

      Bottom line for cards with paid-in-full status: the CC Payment category Available should cover the entire debt (account balance). If the account balance is -$2000, the category Available needs to be +$2000. Alternatively, if you have a positive CC account balance, your CC Payment category Available should be $0. Move funds from elsewhere in order to achieve that.

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  • Gray Unicorn said:
    Why does the  Credit Card Payments category make it seem like the total of the transactions on the card have not been budgeted for? Seems like it's trying to double dip.

    Because not everyone budgets for every purchase in the spending category.

    It's not double-dipping if you have budgeted for those purchases, though, because the cash in the category is immediately moved over to the CC Payment category. The amount of cash you have hasn't changed when you swipe the card, so the net impact to the budget needs to be $0 -- decrease the Clothing category, for example, and increase the CC Payment category. (The budget always equals the cash in accounts.)

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    • dakinemaui That's counter intuitive. If I spend money on clothing I want it tracked in the Clothing budget. I should not be forced to lump a bunch of expenses together into the Credit Card Payment category.

      Not allowing my to treat this as an actual transfer like YNAB 4 used to is not very flexible.

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    • dakinemaui I reviewed the help article here and it makes more sense now. I understand how YNAB is trying to manage the CC Payment but I'm still not a fan and much preferred when it didn't automatically create (and enforce) a CC Payment category. I find it ads unnecessary steps and clutter for my use case. In theory if everything is balanced properly it should manage itself but seeing red in that category when it's not something I'm specifically trying to track and budget for is annoying. Much prefer the old method.

      https://docs.youneedabudget.com/article/117-credit-card-payments

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    • Gray Unicorn if your CC has paid-in-full status, you can use a checking account to to represent it exactly as in YNAB4 (assuming you had a Pre-YNAB Debt category of $0, of course). No CC Payment category needed, since enough to pay the entire debt is implicitly reserved at all times.

      Convert easily by making a payment/transfer from a new, $0 balance checking account. Close the old account afterward.

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    • Gray Unicorn said:
      seeing red in that category when it's not something I'm specifically trying to track and budget for is annoying

      It is trying to warn you things are not balanced and you have NOT budgeted for part of your debt.

      The checking account workaround will force things to balance. You would do well to balance the CC Payment category before you convert. If you cannot while budgeting for your other obligations, then you are actually riding the CC float and should not convert until that is rectified. Riding the CC float cannot be done with the checking account representation.

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    • dakinemaui said:
      It is trying to warn you things are not balanced and you have NOT budgeted for part of your debt.

      I get that part but it feels like the process is adding a middle man that gives me no value for my situation and just adds confusion. I get there are other use cases that it probably works well for. I may try converting it to a regular checking account since that's essentially how we use it, thanks for the suggestion

      Like 1
  • Gray Unicorn said:
    That's counter intuitive. If I spend money on clothing I want it tracked in the Clothing budget.

    1. You don't spend money. You incur debt.

    2. The purchase is tracked in the Clothing category. You will see that balance decrease. It shows up in spending reports as well.

    It's as intuitive as the old-school "cash in envelopes" approach. Your grandparents may have taken cash out of the Clothing envelope and put it in the "Pay off my IOU" envelope. YNAB just does that for you.

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