Automatic Credit Card bill estimation

[wtanksleyjr]

#3442

I normally try to pay my credit card bill every month, and CalendarBudget is helpful in doing that.

However, there’s an extra manual step if I want to see how that good habit integrates with the rest of my planning for the future. I have to add up all the expenses between the start and end date of the credit card’s billing period, and add them into a transfer at the due date for that billing period so that the money is planned to be removed from the cash account from which I’m paying the credit card.

Would it be possible for CalendarBudget to do that addition automatically?

-Wm

[Eric Poulin]

#3935

Interesting idea.

Not sure if CalendarBudget should do that though… Not everyone pays off their entire credit card (even though that’s the best way to go, of course).

Also are timing issues – such as transferring money from a bank account to a credit card account sometimes takes a few days to clear (or transaction sometimes don’t get posted to the credit card count for a few days) which could cause trouble if we try to automate adding up your credit card expenses.

For these reasons, I think your well intentioned idea would be better left as as-is – leaving the user to decide how much and when to transfer funds between accounts.

[wtanksleyjr]

#3936

Fair enough… And I’ll add in support of deferring this idea that there are a billion and one things your programmer(s) have to do.  :D

ALSO: it’s a quickly thought out idea that would add a _very_ special case just for fully-paid-off credit cards. Probably something even better could be done, if I bothered to think it through.

Frankly, though, I don’t think timing is a real problem. The BIG purpose of this idea isn’t to produce a perfect day-by-day prediction, but rather to allow me to make sure the right amount of money is in the right place — if the actuall bill needs to be paid a few days later than planned nothing is going to explode. The big deal is (for example) that I know that $2000 balance sitting in the account two months from now is NOT available for discretionary spending, because it’s going to be spent to pay the unusually high credit card bill caused by several quarterly bills coming in at the same time on the previous month.

But… like I said… there’s probably a better way.

-Wm

[Eric Poulin]

#3937

I hear you – you’re thinking of kind of “reserving” an amount of your balance and warning (or something) if the balance goes below.
This needs a little more thought, but I’ve added the suggestion to our bug/feature list.
[edit]
In fact, the more I think if this idea, the more I like it :)
No other tool does that.

[wtanksleyjr]

#3938

I can see a problem with that… I don’t need to keep that amount of money in my account forever; I only need to make sure it’s there in time for the bill — just like every other planned expense. It seems like a natural use for a planned expense.

However, while reading some of the old forum messages, I found one old idea that might be better than mine — the commentor called it a “snowball” program, but let’s just call it a “debt planner”. It’d be a menu selection that would ask you some questions, then generate calendar entries for the forseeable future. In addition to asking you for any overdue balances on the accounts CalendarBudget knows about, it would also ask for other debts, their amounts, their due dates, whether there’s special zero-interest treatement for bills paid on time… It would also ask you for your priorities (pay down debt ASAP, maintain position, clear only the high-interest debts, and so on) and strategy (optimal, Ramsey Snowball, etc).  Then it would generate transfers that are calculated based on priorities.

If the script is run a second time, it would read in the existing transfers and pre-fill the plan with the data implied by them (yes, the entries would have to include some kind of marker so that script would know how to look for them).

That’s kind of blue sky, but it seems useful.

[ivicaSD]

#3939

As I see this (I should read this topic for another 3-4 times to fully understand the need of wtanksleyjr) – you should make some RESERVATION of your funds. I would open another “virtual” account (named RESERVATION, for example) and transfer funds onto it! Also, I would make another transfer (back) on the exact date of credit pay-off. You could look at it as some savings account.

[wtanksleyjr]

#3940

As I see this (I should read this topic for another 3-4 times to fully understand the need of wtanksleyjr) – you should make some RESERVATION of your funds. I would open another “virtual” account (named RESERVATION, for example) and transfer funds onto it! Also, I would make another transfer (back) on the exact date of credit pay-off. You could look at it as some savings account.

I tried this — it doesn’t work, because it throws off all of the CalendarBudget bank reconciliation.

For a future bill with a known date there’s another option — simply manually update the future bill. As long as you remember to scroll a couple months ahead to look for negative cash balances you’ll be OK. It’s a pity that’s a lot of manual work if you use a credit card a lot, but it’s better than nothing.

And odds are that your credit bill will be pretty much the same every month, so perhaps you can get away with only entering a guess, and then updating the guess when the bill arrives.

[Lina5731]

#3941

Thanks for update.

[wtanksleyjr]

#3942

In the bad old days, this would be handled by double-entry accounting. Double-entry is a horrible user interface for 99% of personal finance — but there’s something to learn from it.

I’ve been working on that for a long time, designing a personal finance website, but now that I’ve found CalendarBudget I don’t have the energy — it solves 90% of my “wants”.

[dav1dr4y]

#3943

I would also like to have this feature.  I came here to suggest it and then found someone else already had.  It seems like the needed data is already available in CalendarBudget… which is the cool thing about CalendarBudget.  It knows what the balance is on each date.

When you pay the full balance on your credit card every month you are paying the previous month’s closing balance.  That should correspond (and does, in my experience) to the CalendarBudget balance for the card on my accounts closing date.

Here is how I see it working.  We would need to store our closing date and payment due date with the account information.  So, say my payment due date is the 25th and my closing date is the 28th.  A full-pay transaction could be automatically entered on the 25th with whatever my credit card balance was on the 28th of the previous month.  Viola!  And, even cooler, take the balance shown on the next 28th of the month and enter it as payment on the 25th after that. 

One trick would be for CalendarBudget to revert to manual mode if I overwrote the payment amount.  Say, I can’t afford the full payment this month and edit the payment amount for this month.  I wouldn’t want CB to keep changing it back.

But this seems like a awesome feature to me.  Assuming this automatic entry was made two months into the future I would see a credit card purchase today hit my check book balance a month and half (or whatever) from now.

[Peter Cutter]

#5844

I hope I am not missing any requests along the lines of this:
Previously, when I have done some longer term planning on revolving credit debt, I have set up a spreadsheet calculator that calculates successive monthly balances based on the previous month’s balance and fixed values for interest rate and my anticipated monthly payment amount. I automatically link this with my monthly budget so when things are paid off under this plan, payments also can stop.

I’d love to see something like this in Calendar Budget. I envision being able to set up a revolving credit account where interest rate (and maybe compounding rules) are set and balances can be forecast into the future based on planned monthly payments to the revolving credit line, the balance at any given time, and the monthly interest charges.

Thanks–Love this tool!

Pete Cutter

[Author]

Posts