Debt tracking - what am I missing?

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So I'm having to use my debt credit card for certain purchases but I'd like to budget for using it. I appear to have unallocated funds that can be set aside for these purchases. However, when I Add a Transaction, I'm diverted to the web so I can add the debt transaction but I'm not given an option to assign it to an envelope. What steps come next when allocating my money to pay off the new debt?

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Posted 2 months ago

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Tiffany Kucifer

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I’m not sure I understand your question? The credit card is an Account but the expenses go into an Envelope. You may be struggling with using Debt transactions on a mobile app, and if that’s the case I might suggest that you create another account for that card that’s set up to pay monthly. The goal is to pay down your credit cards, so it’s not easy to add transactions to them. In my case, if it helps, I have a balance on a credit card because it’s on a promo, but I also use it for some charges each month that I pay off in full. I have an account called “Citibank monthly” which is a “paid off every month” credit card, and one called “Citibank extended” for the promo purchase, which is a “paid off over time” card, even though they’re the same physical card. When I pay the bill, I pay the amount I’ve budgeted for the long term purchase plus the amount I’ve added during the month.
Does that help?
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What I think you've captured is not categorizing the new expenses made to the credit card. If I did it this way, although I understand why you do, I would not be able to classify the new charges under my currently existing envelopes (like, Car: Parking, Kids: Registrations), which will help me understand how to develop my next month's budget.

If I try to add the transactions to an envelope, it won't let me, and kicks me to the web where I enter details there. If I add funds to the Debt Payment envelope, that captures essentially what you're doing, and maybe that's the solution, but it doesn't categorize anything for me.

I know using a debt credit card in this way, even for those emergency situations, is not ideal. But maybe the only option is to add up the additional charges and add that amount to the Debt Payment, and individually just modify envelope budget on the fly for next month.
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Wayne Woodbury

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The debt feature is designed for accounts (credit cards, loans, etc.) that you are trying to pay off but are not actively using.  If you are using the credit card actively, I would set it up as a credit card account and not a debt account.  When you make a purchase with the card, record it as an expense transaction.  This will allow you to select the account and the envelope.  When you make a payment on the card, you simply record an "account" transfer transaction.  This will list the account you are making the payment from as well as the account to which you are making the payment.  Envelopes are not listed here as you are not making a purchase against your budget.

If you have a balance on the card you are trying to pay off, but you would still like to use the card for daily expenses, you have a few options.  You may want to transfer the debt to a zero-interest card that has a good offer or get some other type of loan.  You may want to create an envelope to track the debt.  This gives you a negative balance in an envelope that also impacts your balances displayed in Goodbudget and can be confusing to manage payments and debt reduction.  For this reason, I don't recommend it.  You could create two accounts for the credit card: one credit card account for daily expenses and one debt account to manage your debt reduction plan.  This can also be confusing, but here is another thread you may want to look at (another conversation with Tiffany that goes into more detail about what she describes above):  This is also my preferred method.

Good luck, and let us know if you have more questions.

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Phil Shuart

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Try to change the “Debt Transaction” Type from Payment to Fee, Interest, and New Charges. Then you will be able to enter the transaction and have the charge added to your credit card total balance. Say its $100. Under name simply enter — Charge - New Tire/Clothes/Whatever. Under the “Debt” Drop down select — Your Credit Card that was used. When you check...$100 will be added (actually subtracted) from your existing “negative” card balance.

I went into more detail in this thread earlier today.