why do credit card balances take from unallocated?

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I'm not talking about net balances

we're talking about unallocated, IMO what you owe on a credit card should not count against your unallocated funds only your NET funds this should IMO be corrected.

I am not willing to track my credit cards on EEBA for this reason, I disagree with how it affects unallocated funds as IMO unallocated funds belong to the bank accounts NOT your credit cards.
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Shannon Mason

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Posted 8 years ago

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Glenn Huther

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Hi Shannon!

I'm having a lively discussion on this very topic over here:
https://getsatisfaction.com/easy_enve...

Well it's sort of the same topic... as it happily makes use of the unallocated funds but still explores how they work together. Consider taking a cash advance from your credit card of $1000 and holding it in your hands (putting it into unallocated). Now you have $1000 to allocate to your envelopes for spending on groceries or whatever.

I don't know if the thread I linked to will help or hinder (it's getting pretty deep) but I think we're coming to some clarity near the bottom.

Anyway the professionals will probably answer your question better than this, I just thought you might find the other thread interesting.

Cheers, Glenn
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Chi-En Yu, Official Rep

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Just to clarify here -- I think the situation you're talking about Glenn (holding your Debt in a separate Debt Envelope that's parallel to your Debt Account), is different from what Shannon is talking about (why adding a Credit Card in EEBA negatively affects your Unallocated Money).

Credit card balances have a negative effect on your net funds, including the All Envelopes Total in EEBA. So adding a credit card in EEBA would not be like taking a cash advance and holding it in your hands.
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Chi-En Yu, Official Rep

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Hi Shannon,

I'm not sure what you mean by net balances, but I'll try to explain EEBA's approach to credit card balances and how that's connected to Unallocated.

You said that what you owe on a credit card should count against your net funds, which is how EEBA does things. I think the difference between what EEBA does and what you might want is that those net funds are tracked in both the Accounts and the Envelopes (including Unallocated), rather than only in Accounts. So if I have net funds of 1500 in all my Accounts, I need to have exactly net funds of 1500 in all my Envelopes (including Unallocated). It's essentially two views of the same money, where Accounts show where the money is sitting in real life, and Envelopes show how I plan to spend the money. This is called double-entry accounting.

In short, affecting Unallocated is a shortcut we use to help keep the net funds as counted by Accounts and the net funds as counted by Envelopes equal to each other. (In case it wasn't clear, Unallocated is a special type of Envelope in EEBA).

If instead, you'd like to use Unallocated to keep track of the remainder in your Checking Account that hasn't been assigned to Envelopes, you can put the negative amount caused by the credit card balance into another Envelope (called Debt, if you're working to pay it off, or Credit Card Expenses, if you pay it off every month).

If you're looking to do something like this, it takes a few steps to set it up, but it's possible with EEBA, and I can point you in the right direction to get it working for your situation.

Does this answer your question?

Thanks,
Chi-En
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Karisa Russell, Official Rep

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Hi Kimberly and Colin, 

Kimberly, if you need help setting up what Chi-En is talking about, check out Option 2 of our Starting with Debt article: http://help.goodbudget.com/customer/en/portal/articles/1114030-starting-with-debt

We recommend this method of tracking debt for folks who are no longer using those cards and are just working on paying off the balances. 

The article that Colin linked you to shows you how to reflect in Goodbudget a real life credit card payment that you've made when you're tracking debt like this. 

Thanks!
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Shaun Duffy

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What if we're doing both? We have a credit card account that we use for monthly purchases that get paid off within that month and we also use it for larger purchases, vacations, etc that get paid off over the course of a year.
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Karisa Russell, Official Rep

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Hi Shaun, 

Thanks for posting! It sounds like you're still actively using that credit card. If you're tracking it as a Credit Card Account in Goodbudget, than the balance you carry from month to month (those larger purchases) will impact how much you have available in Unallocated. 

Thanks
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danielgomez909

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I'm following this thread but it isn't doing what i'd like. Say i have  CC with $1000 in outstanding balance. I don't want that negative balance to show up in unallocated. They do not represent funds i can allocate. I tried creating an annual envelop with an amount equal to the balance on the CC and allocating the funds equal to the balance of the CC, but that didn't do it. I tried creating an "expense" that zero'd out the balance, but that only affected the account tab, not the other one. Please Help!
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Karisa Russell, Official Rep

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Hi there,

Thanks for sending us an email also! We've replied to you directly with some suggestions. 

To clarify, Daniel, the workaround I posted two years ago is one that we're not recommending to folks anymore. What that old workaround did, though, was remove the negative balance that was placed in Unallocated as a result of the Credit Card Accounts folks would add. We're currently on new debt tracking features that will help people track their debt pay off progress with off-budget accounts. That way, the debt balance that's carried won't impact Unallocated. If you'd like to give them a try, just reply to the email we sent you so you can get started.

And, if other folks have cards their no longer using, or loans that are being paid off, and want to track debt payoff progress, just send us an email to support@goodbudget.com and let us know. 

Thanks