Budget: Transfer vs. Payment

Money 2005 Deluxe

I've set up a budget. Many items have been added as a result of having
created a series of bills in "Bills."

1. I have a number of credit card accounts set up in Money. Four out of
the five "bills" I've set up show up in the Budget as "Transfers out of
Budget Accouts." But one shows up as simply a payment.

(FWIW, the "transfers" have an icon next to them with a horizontal
bi-directional arrow, and the renegade has an icon with an arrow pointing
up.)

All payments are made from the same checking account.

Why doesn't the fifth item show up as a Transfer Out?

Thanks.
Ken

Chris
Mon Jan 02 15:55:34 CST 2006

"Ken" <allstates[no_spam]air@yahoo.com> wrote in message
news:%23J3UoR%23DGHA.344@TK2MSFTNGP11.phx.gbl...
> Money 2005 Deluxe
>
> I've set up a budget. Many items have been added as a result of having
> created a series of bills in "Bills."
>
> 1. I have a number of credit card accounts set up in Money. Four out of
> the five "bills" I've set up show up in the Budget as "Transfers out of
> Budget Accouts." But one shows up as simply a payment.
>
> (FWIW, the "transfers" have an icon next to them with a horizontal
> bi-directional arrow, and the renegade has an icon with an arrow pointing
> up.)
>
> All payments are made from the same checking account.
>
> Why doesn't the fifth item show up as a Transfer Out?

Because you've categorized it using an expense category, rather than a
transfer. A transfer is a 'special' category. 'Credit Card Payment: [account
name]' is simply a transfer by another name.

Using a transfer to pay a credit card is the ideal method, within Money.
Because they're appearing in your budget, that means the target accounts are
not included in the budget. That means in individual transactions are
ignored. Revise the account details to include them in your budget for
greater accuracy. The payments will then not be counted, because it would be
double-counting them. They will appear in your cash-flow forecast.
--
Chris Cowles
Gainesville, FL

Ken
Tue Jan 03 13:34:36 CST 2006

I'm real confused now.

I went back to my Bills, and made all my credit card payments "Transfers."
From Checking Account to Credit Card Account.

Then I went and created a brand new [Advanced] Budget. I tried both
methods: Autobudget, and whatever the other one is.

In neither case did my scheduled Transfers to pay credit cards show up.
(All accounts are included as budget accounts.) (One of them picked up all
of the recurring payments I'd made in the last year to my credit cards, and
included them as simple payments.)

Wha' happened?

Thanks.
Ken



"Chris Cowles" <NoSpam@For.me> wrote in message
news:%23MlQEd%23DGHA.3064@TK2MSFTNGP10.phx.gbl...
> "Ken" <allstates[no_spam]air@yahoo.com> wrote in message
> news:%23J3UoR%23DGHA.344@TK2MSFTNGP11.phx.gbl...
>> Money 2005 Deluxe
>>
>> I've set up a budget. Many items have been added as a result of having
>> created a series of bills in "Bills."
>>
>> 1. I have a number of credit card accounts set up in Money. Four out of
>> the five "bills" I've set up show up in the Budget as "Transfers out of
>> Budget Accouts." But one shows up as simply a payment.
>>
>> (FWIW, the "transfers" have an icon next to them with a horizontal
>> bi-directional arrow, and the renegade has an icon with an arrow pointing
>> up.)
>>
>> All payments are made from the same checking account.
>>
>> Why doesn't the fifth item show up as a Transfer Out?
>
> Because you've categorized it using an expense category, rather than a
> transfer. A transfer is a 'special' category. 'Credit Card Payment:
> [account name]' is simply a transfer by another name.
>
> Using a transfer to pay a credit card is the ideal method, within Money.
> Because they're appearing in your budget, that means the target accounts
> are not included in the budget. That means in individual transactions are
> ignored. Revise the account details to include them in your budget for
> greater accuracy. The payments will then not be counted, because it would
> be double-counting them. They will appear in your cash-flow forecast.
> --
> Chris Cowles
> Gainesville, FL
>
>
>

Dick
Tue Jan 03 13:56:47 CST 2006

I'm not sure you and Chris are on the same frequency.

The basic message is this: you don't budget the credit card payments--save
an interest component. You budget the spending that created the credit card
balance in the first place. (This is why the interest gets budgeted--it's
new spending.) This makes some sense as it has you controlling the expense
when and where it occurs--the $50 for Leisure:Bar Tabs rather than the
cumulative and after-the-fact $3,000 credit card bill that results from a
month of that.

Paying the credit card principal is not a Budget problem--paying it makes
you neither richer nor poorer. It's like transferring money from your left
pocket to your right pocket. It's just transferring money to cover expenses
that already occurred.

Paying the credit card principal is surely a cash flow issue. Forecast Cash
Flow is a better place to try to manage it. Money does provide the "Debt"
and Transfer In/Out of Budget Accounts" schemes to get around this
perceptual limitation many users have. ("Why can't I keep spending when my
Income exceeds my Expenses?" Because you already did so!) To get the credit
card payment reflected in the Debt section, you will have to set the card
debt up to be managed by the Debt Reduction Planner. This has other effects
you may not like. To get the credit card payment reflected in the Transfer
Out of Budget Accounts section, you will have to clear the Include in Budget
Planner flag in the credit card account's account settings.

I hope this does not further confuse you.

"Ken" <allstates[no_spam]air@yahoo.com> wrote in message
news:%23LHh8yJEGHA.2292@tk2msftngp13.phx.gbl...
> I'm real confused now.
>
> I went back to my Bills, and made all my credit card payments "Transfers."
> From Checking Account to Credit Card Account.
>
> Then I went and created a brand new [Advanced] Budget. I tried both
> methods: Autobudget, and whatever the other one is.
>
> In neither case did my scheduled Transfers to pay credit cards show up.
> (All accounts are included as budget accounts.) (One of them picked up
all
> of the recurring payments I'd made in the last year to my credit cards,
and
> included them as simple payments.)

Ken
Tue Jan 03 14:51:41 CST 2006

I actually follow you! Thanks. (The left-right pocket analogy is right
on.)

I guess the reason I want the credit card payments IN the budget is because
I'm paying down the cards and not (planning on) charging any more. But I
will explore the debt reduction planner.

Many thanks.

"Dick Watson" <littlegreengecko@mind-enufalready-spring.com> wrote in
message news:eX1XV$JEGHA.2436@TK2MSFTNGP15.phx.gbl...
> I'm not sure you and Chris are on the same frequency.
>
> The basic message is this: you don't budget the credit card payments--save
> an interest component. You budget the spending that created the credit
> card
> balance in the first place. (This is why the interest gets budgeted--it's
> new spending.) This makes some sense as it has you controlling the expense
> when and where it occurs--the $50 for Leisure:Bar Tabs rather than the
> cumulative and after-the-fact $3,000 credit card bill that results from a
> month of that.
>
> Paying the credit card principal is not a Budget problem--paying it makes
> you neither richer nor poorer. It's like transferring money from your left
> pocket to your right pocket. It's just transferring money to cover
> expenses
> that already occurred.
>
> Paying the credit card principal is surely a cash flow issue. Forecast
> Cash
> Flow is a better place to try to manage it. Money does provide the "Debt"
> and Transfer In/Out of Budget Accounts" schemes to get around this
> perceptual limitation many users have. ("Why can't I keep spending when my
> Income exceeds my Expenses?" Because you already did so!) To get the
> credit
> card payment reflected in the Debt section, you will have to set the card
> debt up to be managed by the Debt Reduction Planner. This has other
> effects
> you may not like. To get the credit card payment reflected in the Transfer
> Out of Budget Accounts section, you will have to clear the Include in
> Budget
> Planner flag in the credit card account's account settings.
>
> I hope this does not further confuse you.
>
> "Ken" <allstates[no_spam]air@yahoo.com> wrote in message
> news:%23LHh8yJEGHA.2292@tk2msftngp13.phx.gbl...
>> I'm real confused now.
>>
>> I went back to my Bills, and made all my credit card payments
>> "Transfers."
>> From Checking Account to Credit Card Account.
>>
>> Then I went and created a brand new [Advanced] Budget. I tried both
>> methods: Autobudget, and whatever the other one is.
>>
>> In neither case did my scheduled Transfers to pay credit cards show up.
>> (All accounts are included as budget accounts.) (One of them picked up
> all
>> of the recurring payments I'd made in the last year to my credit cards,
> and
>> included them as simple payments.)
>
>

Chris
Tue Jan 03 19:21:12 CST 2006

"Ken" <allstates[no_spam]air@yahoo.com> wrote in message
news:%23$0SBeKEGHA.2424@TK2MSFTNGP10.phx.gbl...
>
> I guess the reason I want the credit card payments IN the budget is
> because I'm paying down the cards and not (planning on) charging any more.
> But I will explore the debt reduction planner.

Putting the accounts in the debt reduction planner puts them in the budget,
but you won't see the individual accounts as line items. There will be an
entry for 'debt reduction planner' under Debt, and you can't control the
appearance in the budget.

I recommend you try the DRP. It's pretty easy, if you fill in all the info.
I also recommend you not spend anything on those accounts. It makes it much
cleaner, and speeds up payoff. For the accounts you do use, pay them off
monthly.

FinTech
Wed Jan 04 19:39:43 CST 2006

How would it sound to you if you could actually put the monthly credit
card payments back into your pocket? Email me to learn the program.