1/31 - When is the money "spent"?

[Deleted]

I just realised that I am double counting some of my spending on my spreadsheet. If I put something on my credit card I enter it as an expense when I buy it and again when I pay it off.

So when do you consider the money spent? When you buy or when you pay the CC?

[Deleted]

So you are more frugal than you even thought!

[Deleted]

I don't trust myself to use my CC for anything but emergencies and business travel yet, so for me this only pertains to my checking account.

All of my recurring bills are "spent" on the first of the month, so my spreadsheet usually shows a lower balance than my bank.

Everything else is "spent" when it is purchased rather than when the payment is processed.

[Gardening Grandma]

I put an expense on my cc. I'ts "spent". At the same time, I subtract the CC's running total from my checking account so that the money is now set aside to pay the CC at the end of the month.

[isabella]

Good question! I consider an expense for the month on the date of purchase. I as well use a rewards credit card for most all purchases. I'm using a daily planner to record daily cc/cash spending until I get the hang of this. My cc cut off date is the 6th, so in the past I mostly looked at spending for example Jan 6th - Feb 6th., that no longer makes sense to me if I am going to participate in this Low Spending Monthly accounting. I usually budget an amount for the billing cycle, for example if I think my spending should be 1K or less based on projections .. I'll start a sheet like I would for a checkbook with the 1K and then keep receipts and deduct amounts as I go so I have a running total. I think this maybe backwards (?) as I look at it as how much do I have left to spend for the remaining period. I'm not sure of I am explaining this right? My head is spinning right now thinking about this too much!

[dividend]

Jan 31, 2011 12:01:38 GMT -5 Gardening Grandma said:

I put an expense on my cc. I'ts "spent". At the same time, I subtract the CC's running total from my checking account so that the money is now set aside to pay the CC at the end of the month.

This.

Every purchase is recorded in my spreadsheet (it's named "digital checkbook") as a credit to the appropriate CC, and as a debit from the appropriate fund. So if I buy groceries with my Chase Visa (5% cash back!!!!), the total is added to the Chase column, and subtracted from the grocery column. Then when I pay the CC bills each month (in full), the come directly out of the correct CC column.

I keep 2 running totals - one for the total amount in my checking account - this decreases when I actually pay the bills, and one with the CC's subtracted - that's the "real" total.

[Deleted]

Jan 31, 2011 11:49:26 GMT -5 ArchietheDragon said:

So you are more frugal than you even thought!

No kidding! And here I thought my fairy godmother was depositting extra money for me all this time. Boy, the things ya learn when you write it down.

[❤ mollymouser ❤]

OK, this question makes my head spin, lol!

We rarely put other bills on the credit card ~ we write checks for those bills. I consider the money spent when I write the check.

I watch the credit card balance daily (we use it for day-to-day purchases, gas, groceries, stuff, and pay it in full several times a month ~ on paydays) .... I guess I consider that money spent once I've charged something, though technically the bill isn't paid until I plop money down on the card.

[Deleted]

Molly I was putting the item in the expense line when I bought it AND had a line for paying off the CC. I used to do the same thing when tracking what I spent in my head and then vaguely wondered why my bank balance was so much higher than I expected. I put everything on Excel at the beginning of January with all the formulas etc so when I went to balance with the bank account I had to figure it out.

[❤ mollymouser ❤]

uh oh. head spinning again!

[daisylu]

The moment it is charged fro me. Gas is probably the least amount that I charge in a single transaction, and since the is no limit to how many payments I make a month I sometimes make 3-4 cc payments a month.

[cronewitch]

When I am obligated to pay for something. So if I order something COD it would be when I placed the order and when I buy something when I buy it regardless of how I paid for it. Take a house it is a purchase when I sign the contract at closing. I might pay cash or get a 30 year mortgage or refinance it a dozen times like an ATM but I only buy it once. The interest on any associated debt and property taxes and insurance are expenses each year but repayment of principal is just moving money around.

[TrixAre4Kids]

I run everything I possibly can through my AMEX or Visa to get the mileage. Each item is listed on my spreadsheet, and I color the cell green when I send the payment to the CC.
I have my CC set up in my banks online bill pay, or I can log in directly to the CC site, which I have linked back to my checking account. I make CC payments once or twice a month. I like to see that spread sheet turn green!

[Deleted]

Jan 31, 2011 11:44:30 GMT -5 @justaposter said:

I

So when do you consider the money spent? When you buy or when you pay the CC?

For me, when I buy the 'whatever'.

If I don't have the money to pay off the CC, I don't charge anything to it. The charge is paid off within a week in any case. I don't wait for the bill to come in.

[dividend]

Jan 31, 2011 13:34:10 GMT -5 daisylu said:

I sometimes make 3-4 cc payments a month.

Why?

[merryheart]

For me, the money is spent when the obligation happens. If I buy with a credit card, when I buy it, I'm obligated so the money is spent even though the cash hasn't left my bank yet.

[daisylu]

Feb 1, 2011 10:10:17 GMT -5 dividend said:

Jan 31, 2011 13:34:10 GMT -5 daisylu said:

I sometimes make 3-4 cc payments a month.

Why?

So that I do not have to hold onto so much info.

And please do not suggest spreadsheets - I despise them.

[Waffle]

Feb 1, 2011 13:06:29 GMT -5 daisylu said:

Feb 1, 2011 10:10:17 GMT -5 dividend said:

Why?

So that I do not have to hold onto so much info.

And please do not suggest spreadsheets - I despise them.

I still don't understand, why not just wait until your statement comes and then pay it all in one payment?

[daisylu]

Feb 1, 2011 13:09:09 GMT -5 Waffle said:

Feb 1, 2011 13:06:29 GMT -5 daisylu said:

So that I do not have to hold onto so much info.

And please do not suggest spreadsheets - I despise them.

I still don't understand, why not just wait until your statement comes and then pay it all in one payment?

I just prefer to verify my purchases online a little at a time, rather than a whole month's worth in one sitting. Between me & the hubby it is a lot of charges, and it is just easier this way for us. And while I am there, I just go ahead and post the payment for the things that have cleared.

[writer88]

So when do you consider the money spent? When you buy or when you pay the CC?

Great question, LaterBloomer. I've been curious about this, too.

As evidenced by the responses you're getting, I'd say the "trigger" moment is up to the individual involved.

Me? I receive one paycheck per month. I consider the money spent when cc payment is made, since all of my purchases that aren't paid for by automatic transfer are paid via debit card and credit card (that is used as a debit card, only). I rarely use cash, and rarely carry any with me. My monthly credit card bills total, on average, between $2350 - 2900 per month. I pay them immediately. There are no fees.

I have on my spreadsheets a column for my expenses, another for my income, and a third column where I track my bank transactions. Therefore, the monthly credit card purchases will appear itemized by expense on the expense column, and as a payment in the bank transaction list. I enter the expenses on next month's speadsheet as they are purchased, and I keep a tight lid re: the total amount I can charge with the cc's each month.

The one strange anomaly to my system: Almost 90% of my monthly budget is already spent via automatic transfer and/or credit card payments by the 2nd of each month. I know many people would find my system strange, but it works fine for me.

[Waffle]

Since, I'm trying to dig out of credit card debt, I try not to use my credit cards. I do have a couple of things that get billed to the credit card each month like my home alarm system bill and cell phone bill. The one exception I've allowed myself is the occasional online purchase. But now that I can get Amazon gift cards out of the coinstar machine that should go down too.

So in short, my plan is to not make any discretionary purchases with the credit card and thus not have to worry about when the money is spent.

[Annie7]

I just started to track spending this weekend Luckily we make more than we spend. Any extra goes towards my DH's investment play money. So, I've decided to consider the date it's showing up on the cc or bank website to be the date it's spent. Don't now if it's wrong.