Transfer credit from "Credit Card Account" to "Debt Account"

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So, I have a credit card that I'm working to pay off, but I'm using it in the meantime. I understand that this is not the greatest idea in general, but it's what works for our family right now, so that's what we are doing. Here's my question. I've got it set up as two separate accounts. One a Debt Account for the balance we're working on. The other is a Credit Card account that we use and "pay off every month." The thing is, when I post a payment to the credit card, I don't typically do 2 separate transactions with one being the payoff amount and the other being the remaining balance. I'd like to be able to put all the payments on the Credit Card, and then move whatever credit ends up there to the Debt Account, but the credit card accounts are unavailable to use to pay on the debt accounts, even if there's a credit. Has anyone come up with a good workaround for this? Or do I need to just fudge 2 extra transactions to transfer from credit card to cash (or whatever) and then cash to debt account?
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Becky Dalton

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Posted 7 months ago

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Phil Shuart

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Hi Becky,


I’m a new user but, had the exact same question. See below for how I do it by only using one debt account and none of that double entry accounting nonsense. :-)


1. I created a credit card account and marked it “working to pay off”. This of course moved it to the Debt section. I included the balance, interest rate and my standard (not minimum) payment. In my case $125/mo. Clicked save.
2. Click “Add Transaction —> Click “Debt Transaction” — I set up a recurring monthly payment by setting the date (9/3) adding the amount ($125) Selecting the card in question — Leave Type as “Payment” - Select “Schedule” and choose monthly.

Now I have a recurring $125 payment to the card. A person serious about getting out of debt would never use this card. Unfortunately, I live in the real world.

Let’s say tomorrow I get a flat tire. $200 to fix and I can’t spare it from checking.

1. Click “Add Transaction” - Select “Debt Transaction”

2. I set the date - For “Name” I enter Charge - Amount: Enter $200 - Change “Type” from Payment to Add Interest, Fees, or New Charges. This changes the data box. Now select your card from the “Debt” drop down and make a note of what you bought (I.e. New Tire)

Click Save and you will see you Debt Balance on the card has increased by (in my case) $200

Sorry for the lengthy reply but I spent hours trying to figure this out.


Phil

P.S.. This will work for annual fees on credit cards as well. Could be set up to be recurring yearly. FYI
(Edited)
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Alex Park, Official Rep

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Hi Becky (and Phil),

It sounds like you're tracking a credit card that you're actively using while you pay down its balance, and you're wondering the best / most efficient way to record your payments on this card in Goodbudget. It also sounds like you're using the two Account workaround for tracking accounts in this intermediate (actively using + paying down) situation. What Phil is describing above is a possible solution following the other workaround, which can work, but I also wanted to provide a possible solution following the two Account method in case you didn't want to switch.

(For those wondering: the first workaround (Becky's method) involves using two separate Accounts (one Credit Card, one Debt) to track the active balance and balance you're paying down separately, and the other (Phil's method) involves using just one Debt Account to track everything altogether. There's a good description of the two methods and the pros and cons in this other thread here.)

The best way to track payoff of a single account being tracked as two Goodbudget Accounts is to make two separate different transactions to show that payoff. You'll make an Account Transfer from your bank Account to your Credit Card Account to represent the payment on the actively used part of the balance, then you'll make a Debt Payment Transaction on the Debt Account to represent the payment on the balance you're paying down.

Hope that helps and makes sense!