I had some work done at my home and was able to pay for the work using a credit card with 0% interest for 12 months. The credit card does require a minimum payment every month towards the premium. I am also going to receive a couple rebates for this work which will be deposited into a checking/savings account. My plan is to hold the rebates in my interest bearing accounts until the pay-off date to gain interest and provide a cash cushion in the near term. So I will have monthly minimum payments, (2) rebates, and then (1) final payoff at the end of 12 months.
I am struggling how best to show this in my tiller saving budget. I was thinking the “credit card transfer” category would be the right approach here to show the monthly min payments and then the final payment.
What other categories do you have set up? But in general the minimum payments would just be either a payment; so if you have both your savings and credit card accounts liked yes it would be a “transfer” type catagory.
as for the rebates it goes back to the above question, but assuming you have both it then depends on are you doing an accrual based system or cash. Assuming cash it’ll first be income show you can show the increase in your savings account, and then when you use the funds to pay off the card you can either manually re-class it to offset the original expense or leave as a gross up so that the reimb nets out the original expense, and the CC payments and cash out from savings nets out as well.
This is what I personally use my slightly modified version of Savings Budget for. I create a bunch of virtual envelopes to show me where I have money allocated and how much is left.
For example, I need to make a very large bar dues payment in June every year, and I don’t want to end up either getting hit with a big expense and having to decide where it’s coming from, or accidentally spending money intended for that later because I forgot about it, that kind of stuff. I save for the payment each month in a rollover envelope, which is all really in high yield savings and checking, which is accruing excess interest payments monthly over my actual budget. When June rolls around, I can just make the payment knowing I have enough in my budget (and accounts) to cover it.
If this were my budget, the rebates would get transferred into the digital envelope as they come in, plus I’d be budgeting that monthly minimum amount into the envelope at the beginning of the month along with whatever I need to allocate monthly to accrue to the final amount at the end of the 12 months.
So, let’s say the project was $1,600 with $400 in rebates (total of $1,200 project) and $50/mo in minimum payments. I’d be budgeting in $100/mo of my regular cashflow, paying the $50 and the other $50 is accruing, and the rebates come in when they come in. At the end of that, I should have $600 left to pay off, and $600 in the digital envelope plus any rebates that come in. Those rebates would be put in my high-yield savings and accruing some interest as they come in, but they’re accounted for in my envelope, and I’d have that envelope tagged as “don’t spend this other than minimum payments” as a comment to myself.
Where I modified Savings Budget was to add a calculation that told me how much of my liquid accounts was already allocated somwhere, so I knew if I had discretionary money or not, and how much of my current accounts needed not to be otherwise spent.
