How best to set up credit card purchases which are paid out of chequing

I want to make purchases with a credit card... which I will immediately pay
off thru my chequing account.

With the credit card acct. I can specify the categories of purchases for
budget & reporting purposes, but what do I put on the chequing account for
my credit card payment? Won't that show as extra expense on my budget ?? How
best to handle it?

Also, how best to handle cash withdrawls from ATM from chequing acct.
Creatinfg an account called cash is what I'm doing but when I fund it from
chequing... it is like extra income and will distort my income
amounts....no??

via_newsgroup
Sun Sep 19 19:08:00 CDT 2004

In microsoft.public.money, Robert Nykoluk wrote:

>I want to make purchases with a credit card... which I will immediately pay
>off thru my chequing account.
>
>With the credit card acct. I can specify the categories of purchases for
>budget & reporting purposes, but what do I put on the chequing account for
>my credit card payment? Won't that show as extra expense on my budget ?? How
>best to handle it?

There is more than one good way to download your credit card
data and have also the payment downloaded from a checking account.
Here are two ways I like:

1. When you process the first transaction of the credit card
payment, set the category as a transfer to the other ( credit card
or bank account), or use the equivalent "Credit Card Payment"
category. When you process the second transaction,Money should
match it. Be careful to not just Accept if Money did not find the
match on its own for some reason. Click Change and match it to the
transfer you already made if Money did not match it for you. I
would consider this the classic of the ways I like.

2. In method 2, don't handle credit card payments as transfers or
the pre-defined "Credit Card Payment Instead create one category of
"CC payment" or some such. If you define the category as an
expense category, expect a warning when you use it to represent the
payment within the credit card account -- if you have the warning
enabled. Just click Yes in response to the warning. The category
should net at zero in reports across accounts, and you can still
customize to ignore the category if you like. [Bonnie Synhorst's
favorite]

In analyzing spending, note that the spending occurs when you do
the Buy with the credit card -- not when you pay the credit card
bill.

>Also, how best to handle cash withdrawls from ATM from chequing acct.
>Creatinfg an account called cash is what I'm doing but when I fund it from
>chequing... it is like extra income and will distort my income
>amounts....no??

"Best" is a matter of opinion. I would think calling it a simple
miscellaneous expense, where others would preferred a more detailed
accounting.

Larry
Sun Sep 19 21:52:02 CDT 2004

This is a very good question... I think many users have
battled with an easy and efficient way to do these things.

In my case I have found the best way is to:
Enter the purchase in the credit card account using the
correct categories
Enter a transfer in the credit card account to credit
the amount of the purchase from the checking account
(specify a credit using category Transfer : My Bank Account

As for ATM, I have been entering the transaction and then
specifying the categories I used the cash for. Of course,
Cash Withdrawals are in my budget so the majority of it
goes here, but if I take $50 and use $20 for dining, $10
for parking, and $20 I don't know what happened to, I
enter the $20 as Cash and the other $30 in the correct
categories.

Just the way I do it though.
Larry


>-----Original Message-----
>I want to make purchases with a credit card... which I
will immediately pay
>off thru my chequing account.
>
>With the credit card acct. I can specify the categories
of purchases for
>budget & reporting purposes, but what do I put on the
chequing account for
>my credit card payment? Won't that show as extra expense
on my budget ?? How
>best to handle it?
>
>Also, how best to handle cash withdrawls from ATM from
chequing acct.
>Creatinfg an account called cash is what I'm doing but
when I fund it from
>chequing... it is like extra income and will distort my
income
>amounts....no??
>
>
>.
>

anonymous
Mon Sep 20 08:20:00 CDT 2004


>-----Original Message-----
>I want to make purchases with a credit card... which I
will immediately pay
>off thru my chequing account.
>
>With the credit card acct. I can specify the categories
of purchases for
>budget & reporting purposes, but what do I put on the
chequing account for
>my credit card payment? Won't that show as extra expense
on my budget ?? How
>best to handle it?
>
>Also, how best to handle cash withdrawls from ATM from
chequing acct.
>Creatinfg an account called cash is what I'm doing but
when I fund it from
>chequing... it is like extra income and will distort my
income
>amounts....no??
>
>
>.
>

Lois
Mon Sep 20 08:26:07 CDT 2004


>-----Original Message-----
>I want to make purchases with a credit card... which I
will immediately pay
>off thru my chequing account.
>
>With the credit card acct. I can specify the categories
of purchases for
>budget & reporting purposes, but what do I put on the
chequing account for
>my credit card payment? Won't that show as extra expense
on my budget ?? How
>best to handle it?
>
>Also, how best to handle cash withdrawls from ATM from
chequing acct.
>Creatinfg an account called cash is what I'm doing but
when I fund it from
>chequing... it is like extra income and will distort my
income
>amounts....no??
>Regarding the payment of your credit card. I enter the
payment in my chequing account as a transfer from my
chequing account to my Visa Account. It works fine and
doesn't affect my budget reports etc.

Machine withdrawals I simply categorize them as machine
withdrawal. I do not put the money into a cash account
but enter my expenditures under split cash transactions in
the same space as the withdrawal.
>
>.
>