I see some questions about how people are handling credit card payments but I am not following the processes described. So I have a credit card that is a straight debt, balance transfer from another loan. I am making payments on this monthly, and I have linked the card to my budget.
So I budgeting say $100 a month to pay against this card. But when the payment is made I have the transaction out of the checking account for the payment and a transaction into my credit card as credit. Historically, I have not had a credit account added to Tiller so this is a different process for me. The payment out of checking gets categorized as a spend from the budget for the line item of the credit card and balances out the $100 budgeted. However, I then have his rogue $100 transaction that has not home. I can just create a dead category that continues to accumulate these orphaned charges, but that doesn’t seem right either.
From my viewpoint, you wouldn’t budget for a credit card payment, since it’s just a transfer between accounts. You should instead budget for the things you buy with the credit card.
Example. I spend $20 on a rake and it counts against my “Lawn” budget. I spend $50 on a game, and it counts against my “Entertainment” budget. I spend $30 on some pants, and it counts against my “Clothing” budget. I then pay the credit card with my checking account, and both the $100 out of my checking account, and the $100 into the credit card are categorized as “Transfer”. From a budgeting standpoint, the accounts make no difference.
While this is true for my primary credit card, for this particular one there is nothing being purchased. This card has a balance transfer from another debt, these are not purchases. So this is no different than budgeting to pay off a loan, except for the in/out transactions that occurs.
Thank you Morgan, that is how I have handled it for now. I just wasn’t sure if there was a better way to handle it. It just leaves these orphaned transactions in a line on the budget and even though it doesn’t have an impact on the budget it just seemed odd to me.
@andy thanks for sharing more on how you were thinking about this workflow. It definitely is not the most intuitive but if using a transfer category those amounts for the inflows shouldn’t be showing up on the budget at all (Transfers are not factored into the Monthly Budget in the Foundation Template by default).
Let us know if you have more questions or need more help on that workflow
@heather I probably chose my words poorly on that. You are correct they are no were on the default budget template and because of that they really probably don’t impact anyone using that. I am using the Savings template and the Transfers are shown (I could easily hide them I suppose). They still have not actually dollar impact on the budget, it is more just seeing them and having something that is visibly tracking those “orphaned” transactions. Sorry to confuse that. This is totally an anal-retentive thing for sure.
@randy I amusing the Savings Budget template. So the transactions show up at the bottom. I have historically used the Credit Card Payments category for payments that have an inflow and outflow in Tiller. Just created the new one for transaythat don’t have an offset.
The Savings Budget does filter out categories that are hidden. Are you sure Credit Card Payments and Orphaned CC Payments are set to “Hide" in your Categories sheet?
