Budget over multiple accounts

I have a groceries allowance that is funded by my checking account. My wife and I have separate credit cards that we use to buy groceries. How do we add those transactions so that they count against our groceries allowance? I’ve added the expense to my credit card so that the balance will be correct but I don’t know the next step for this transaction to count against my groceries allowance.

Thank you

Hi Jeff,

Once again, an excellent question. This is one that we have spent quite a lot of time on, and continue to do so.

Credit cards are tough because of their nature of providing available funds that need to be paid back at a later date, preferably every month. Having allowances that link to a credit card, or a feature where credit card spend affects available balance in the account responsible for repaying it, is a feature we are actively working on.

In the meantime, I’ll tell you how we have handled this personally. Originally we had our allowance on our savings accounts (the same as your checking account) and when we spent on the credit card we’d adjust our allowance accordingly by just changing the balance. We also had a goal to pay off the credit card from the account on which our allowance resided.

While that technique worked okay, it wasn’t what we wanted. We ended up implementing our monthly spending as suggested by Scott Pape, known here in Australia as the Barefoot investor. We opened a joint account with a bank that had Visa Debit cards, but no monthly fees (we chose ING here in Australia, I’m not sure what is available to you) and our allowances are all within this bank account. This way we just log expenses as we go, and we have automatic transfers to top up the allowances. We also ditched the credit cards as our projections showed they were not savings us anything.

So to sum up, there are ways to handle this, but we are also looking at ways of implementing allowances on a credit card and other potential options for managing credit card spend.

Thanks for the great question, and also the review on the App Store!

David.