Is there a good way to categorize when funds are swept from your primary checking account into a savings account? Same question for when credit card bills are paid.
We’ve already itemized the individual charges but aren’t sure what to do when the funds are swept from our checking account and paid to the credit card company.
Would welcome any thoughts on this one!
The way I handle both of these things are like transfers.
For a move from checking to savings, this is just an account transfer ( I have a category called account transfer with the Type set to Transfer). This way it wont coutn any budget or anything, its just money going from one to pocket to another.
For Credit cards i have a category called Credit Card Payment. this is also set to Transfer. I then mark both sides of the payment as credit card payment. Once again it is just liek a transfer. The actual tracking of expenses is done with the individual purchases ( Groceries, Clothing, Gas)
Hope that makes sense.
Just to add to what richl said, there is a difference in what type of CC payment it is. If it’s a card that is paid up in full every month, then I use “transfer” as my category for money going in and out.
If it’s a debt, that I need to pay down, then I have two items in my categories sheet.
One item is the name of the credit card and it’s a debt expense. The other item is “Debt Payoff Received” and it’s a hidden income category. This way, when the money goes out, it’s budgeted to a specific card (you can also just use “Debt Payoff” if you don’t want to budget for each debt/card.) Then when the money hits my debt account, I use “Debt Payoff Received.” The debt is not marked as transfer because I want it on my monthly budget so I can see how much debt payments I have for the month. (You can then also make use of several debt templates in the lab and on here.)
Richl - quick question. I’ve been using Tiller Foundation and many of the varied workflows. But, I’ve just added a credit card to my account list. So in my Transactions, the expense for my CC is showing up. I’m curious how you label the expense in the transaction sheet.
For instance, I had some car repairs to do. If I select the category Maintenance - Auto, this would then show up on my Budget sheet. But I’m not looking to budget the expense in my Transaction. Once I pay toward this debt from my checking, with my checking transaction I’ll categorize as ‘Debt Payoff’. Once this posts to my CC (as a positive value), I’ll update this with ‘Debt Payoff Received’ which is a Transfer ‘Type’.
But, I’m not sure what to categorize the initial CC expense now showing on my Transaction sheet.
Appreciate any insight you can provide.
So I categorize the auto repair expense when it hits my transactions sheet. That is when it is spent. I do this for all credit card purchases. Then when I pay the credit card I mark both sides of the payment ( amount taken out of checking and amount paid to credit card) with the category of credit card payment. This is a category that I created that is a type= transfer. This way it won’t show up on my reports.
I hope this helps
Thank you. It’s making me think a bit more.
Do you use either the Debt Progress or Debt Planner worksheet workflows? I’m just wondering how this would affect my current workflow of using Debt Payoff (expense from checking) and Debt Payoff Received (income to loan/debt) since I’m using the Debt Progress worksheet. I then Hide Debt Payoff Received on my Monthly Budget sheet.
No I dont. Sorry, maybe someone else has insight here.
I use similar system, but instead of Debt Payoff, I have a budget item for every debt. It works flawlessly with Debt Planner since the budget and actuals are pulled in by matching names.
If you’re working to pay down a high balance card vs paying the card in full each month the best recommendation really is to stop using that card for every day purchases.
If you don’t then you should consider a workflow where you make two payments each month, one for the statement balance, which should use a transfer type category and then a second payment to cover the additional pay down. Any purchases made using the card would be categorized based on the intent of the purchase (e.g. gas or groceries).
If you stop using the card then you just need to make the one debt pay down payment and the debt payoff and debt payoff received workflow documented here is the way to go.
For Credit cards i have a category called Credit Card Payment. this is also set to Transfer. I then mark both sides of the payment as credit card payment. Once again it is just like a transfer. The actual tracking of expenses is done with the individual purchases ( Groceries, Clothing, Gas)
Do you hide from reports? I flag both
CC payment going out from checking and
CC payment going in to CC as
CC payment and
Transfer. I guess I’m not sure what
Hide From Reports would mean?
Yes. Most people hide Transfer types in the Categories sheet because they are net neutral transactions.