Handling credit cards with Budget is a matter of personal preference. You should strive to pay off your credit card debt, and use your credit card as a simple convenience tool. Budget can help you do that by showing you where you are spending money. There are three different methods you can use which vary in the amount of detail you want to keep regarding your credit cards. The more detailed methods give you a better insight into where you are spending money but require more effort on your part.

Pros: Simple to use.
Cons: No information on where you are spending your money. Can not reconcile the credit card statement with Budget. No payment options.

One method is to create an envelope for each credit card, and use it just like any other expense envelope. This is the simplest way to pay the credit card bill but gives no insight into how the money is being spent. For example, you would create an envelope named "Visa".

In your normal working bank account (the account that you will pay the credit card bill from), allocate money to the credit card envelope from your pay as you would for any other bill. When the credit card bill comes due, use that "Visa" envelope and pay the bill with a check or debit transaction.

With this method, there's no need to record finance charges or refunds. Simply pay the credit card bill when it's due and ignore the parts that make up the bill.

Because you do not record each individual transaction on the credit card, you won't be able to tell where the money was actually spent. You will know exactly how much money you're putting towards the credit card. This method is sufficient if you have a credit card that you don't use anymore, but have an existing balance you need to pay off.

Pros: Moderately easy to use. Detailed information on where you are spending your money.
Cons: Can not reconcile the credit card statement with Budget. No payment options.

The second method to keep track of credit cards is to create an envelope for each credit card, and transfer money into it as you use the card. For example, you would create an envelope called "Visa".

In your normal working bank account (the account that you will pay the credit card bill from), allocate money to your various expense envelopes from your pay. Don't allocate any money directly to the "Visa" envelope.

When you use the credit card to buy something, transfer money from the appropriate expense envelope into the "Visa" envelope. To handle a credit card refund, transfer the amount back to the original envelope.

For finance charges, set up an envelope named "Finance Charges" or "Bank Fees". When you know the amount of the finance charge, transfer that amount of money out of the "Finance Charge" envelope into the credit card envelope.

When the credit card bill comes due, use that "Visa" envelope and pay the bill with a check or debit transaction from your working bank account.

You can use the check mark feature in the envelope History window to help you reconcile your credit card statement. Check each item on the statement with the items shown in the history list for the "Visa" envelope. Click the checkbox to toggle the check mark on or off.

This method provides a degree of insight into where you are spending your money. Each of your expense envelopes can count the transfers as expenses. With that option, your envelopes statistics will show how well you are keeping to your budget.

Pros: Balance the credit card account when you get your statement using Budget, just like any other bank account. Detailed information on where you are spending your money and your outstanding charges.
Cons: More complex to use. Money only gets transferred from your checking account envelopes when you pay the bill, need to view "Total" box to view net amounts in envelopes.

The third method is to set up your credit cards as a bank account. You won't be setting up pay sources or pay allocations for the Credit Card account.

When you use the credit card to buy something, you'll record a charge transaction to the credit card account from the appropriate expense envelope. Since the charges are being recorded (as a negative number) in a Credit Card account, they will not be deducted from the envelopes in your Checking Account until you pay the bill. At that point, the negative amount in the Credit Card account envelope will be zeroed out, and the amount will be deducted from your Checking Account envelope.

On the main screen, when you select the Charge Account, you'll see all the charged amounts shown as negative amounts in your envelopes. When you select the Checking Account, you'll see the money in your envelopes that is available to pay the charges. You can view the "net" amount in the envelopes by selecting the Total box at the top left of the main screen.

For finance charges, set up an envelope named "Finance Charges" or "Bank Fees". When you know the amount of the finance charge, record a charge transaction for that amount of money from the "Finance Charge" envelope using the credit card account.

When you receive the credit card statement, you can balance this account just like you would any other bank account. All your charges will show up in the Balance Window for your credit card account.

To pay the credit card bill see the section on paying credit card bills. When you record this transaction Budget will move money from the bank (checking) account to the credit card account in each envelope.

For more details on how to set up and use a Credit Card Account, see Getting Started Using Credit Card Accounts.