Guide · chapter 2
Accounts, and the
credit card question.
A budget says what your money is for. Accounts say where it physically is. Keeping those two ideas apart is what lets this app do something most envelope apps cannot: handle a credit card without making you think about it.
First, the honest part
You do not need accounts to budget.
Chapter one never mentioned them, and everything in it worked. Accounts are a second, parallel tracker for the balances you keep current by hand — worth it when you want to answer “will the money be there when the bill lands”, and skippable if you do not.
PremiumAccount tracking is a Premium feature. Reconciliation, in the next chapter, needs Ultimate.
What accounts add
Checking, savings, credit cards and loans, each with a balance you update or reconcile. Net worth, payoff planning and statement matching all read from them.
What they are not
Not a bank connection. Nothing here logs into anything — you type the balance, or you import a statement you downloaded yourself.
What stays true without them
Envelopes, funding, spending, rollover, periods, reports. The budget is a self-contained system; accounts sit beside it, not underneath it.
Adding one
Four fields and one real question.
Type, name, balance — then the only question that changes anything: is that balance money you have already budgeted for, or debt you are carrying in?
Plays on its own — or pause it and step through with the arrows at your own pace.
1. Pick what it is Four kinds, and the choice is not cosmetic: it decides the sign of the balance, whether a payment screen appears, and how reconciliation reads the statement.
2. Describe it The last four digits and the issuer are what make a statement recognisable a year later, when you have three cards and two of them are blue.
You said this card is at $840. Is any of that a balance you are carrying — money spent before you started budgeting?
Carried debt becomes a normal envelope you fund like any other. Ordinary charges need no envelope at all — the groceries envelope already paid for the groceries.
3. The question that matters Is this balance money you already budgeted for, or debt you are carrying in? The app has no way to know, and the two behave completely differently from here.
Capital One ••1998$2,000.00
$340 covered · $500 carried$840.00
4. What the screen then tells you Reserved is the part of your checking balance already spoken for by card charges. Available is what is genuinely yours to spend — the number a bank app will never show you.
Step 1 of 4
The rule
Paying a credit card is not an expense.
You recorded the expense when you bought the thing.
That is the whole model. There is no card payment envelope, no card budget, and no new vocabulary to learn — because a credit card is how you paid, and the budget records what you bought, exactly as it does for cash.
It is worth knowing why other apps ask more of you here, because it is not incompetence — it is architecture.
Apps whose budget is computed from account balances have a genuine problem: a card charge does not remove any cash, so the money quietly flows back into the pool and becomes spendable a second time. A “credit card payment” category exists to catch it. It is load-bearing, and it is also why the credit-card page is the longest one in those manuals.
Minturn Money's budget is not computed from balances. Income is recorded, allocated to envelopes, and consumed by expenses; charging a card lowers the category envelope and the money never reappears anywhere. There is nothing to catch, so there is nothing for a payment envelope to hold. Adding one would set aside the money twice — once in Groceries, once again to pay the bill — and report double the spending you did.
Paying more than your charges is different. That extra pays down a balance you carried in, which no envelope ever held money for — real cash leaving with nothing behind it. That part is an expense, and it is booked against the payoff envelope. Otherwise your envelopes would collectively claim money that is no longer in the account.
The whole lifecycle
One purchase, from the till to the payment.
Five steps, and the interesting one is step four — where the budget does nothing at all, on purpose.
There is no “credit card” envelope in that picker, and that is deliberate. See below for why the app that makes you keep one is solving a problem this one does not have.
1. You buy groceries with the card The expense is recorded now, against Groceries, exactly as if you had paid cash. The card is how you paid; the envelope is what you bought.
$512.38 spent · $127.62 available
$640.00
target
2. Two things move. Neither is a surprise. Groceries falls by $100 because you consumed $100 of groceries. The card balance rises by $100 because you owe it. No third entry exists.
Covered — charges made since you started here, already budgeted through the category envelopes. Carried — the balance you brought in, which no envelope has ever paid for.
3. The bill arrives Nothing about the budget changes when a statement lands. The money was committed a month ago; this is only the day it physically leaves.
4. Paying the covered part is not an expense You recorded the expense when you bought the thing. Paying the covered $340 moves cash you had already committed — so every envelope is left alone.
Same bar as the statement two steps ago, and it means the same thing: solid is settled, striped is still owed. Without booking that $200 as an expense, the envelopes would collectively claim money that is no longer in the account.
5. Paying more than that is an expense The extra $200 pays down debt no envelope ever held money for. Real money leaves with nothing behind it, so it is booked against the payoff envelope — the one exception in the whole model.
Step 1 of 5
Coming from another app
The same $100, in three different systems.
Almost every budgeting app sits in one of three camps, and which camp it is in is decided entirely by where its budget gets its numbers from. That one choice is what makes credit cards a chore in some apps and a non-event in others. Here is one grocery run, at the same moment, in all three.
Plays on its own — or pause it and step through with the arrows. The columns move together, so you can see exactly where they part company.
Money is assigned from cash you hold.
A target to measure against, not a container.
Money is in the envelope. Balances are tracked separately.
1. Where the budget comes from Not a detail — it is the thing that decides everything else. Each of these three answers the question “how much can I spend on groceries” from a different source, and that choice is what makes credit cards easy or hard.
No cash left, so $100 returns to Ready to Assign — spendable a second time unless something catches it.
Nothing returns, because nothing was ever set aside.
The envelope fell and the money did not reappear anywhere. There is nothing to catch.
2. You charge $100 of groceries to a card One event, three reactions. Watch the middle line: in a cash-basis app the money you just spent comes back — because no cash actually left your account, and its budget is computed from that account.
Skip it and the $100 gets spent twice. This category is load-bearing, not optional — and it is the most-asked-about part of those apps.
Effortless — but nothing stopped you overspending either. You learn at month end, when the money is gone.
Reserved: $100 of your checking is shown as committed. Information, not a chore — and the envelope already stopped you at the till.
3. So what does each app need from you? This is the step that decides how much of your life the app takes up. One needs a category you must create and keep funded forever. One needs nothing, and gives you nothing. Ours needs nothing and still tells you what is committed.
Correct — provided you kept that category funded every single month.
The payment is detected as a transfer and left out of spending.
A payment is not an expense. You recorded that when you bought the groceries.
4. The bill arrives and you pay it All three end in the same place, which is the point — the difference was never the destination, it was how much you had to do along the way.
Cost: an extra category, forever, whose only job is to undo an artefact of the model.
Gain: real envelope discipline, and balances that always tie out to cash.
Cost: no discipline at the moment of spending — the budget reports, it does not restrain.
Gain: cards need no thought at all, and the feed does the typing.
Gain: envelope discipline at the till, and no card homework. Neither camp offers both.
Cost: you enter or import transactions, and you answer one question when a card arrives carrying a balance.
5. What each one costs you Ours is not free of trade-offs — it asks you to enter transactions, and it asks one question when you add a card with a balance already on it. What it does not ask is that you maintain a second budget to undo the first one.
Step 1 of 5
Switching
What to unlearn, and what carries over.
Most of what you already know transfers. The gap is narrow, specific, and worth naming precisely — so here it is from both directions.
Coming from YNAB, Goodbudget or Actual
Delete the card payment category.
It is the one habit that will actively break things here, because it sets the same money aside twice — once in Groceries at the till, once again to pay the bill.
Stop doing
- Creating a Credit Card Payment category or envelope
- Funding it each month out of Ready to Budget
- Treating the card bill as something to budget for
Nothing leaks, because
Our budget is not computed from your account balances. Charging a card lowers the category envelope and the money never returns to the pool — so there is no leak for a payment category to plug. It was solving a problem this architecture does not have.
Carries over unchanged
- Envelopes, targets and giving every dollar a job
- Moving money between envelopes when one runs short
- Rollover, sinking funds and closing out a period
The one genuinely new question
When you add a card, say whether its balance is debt you are carrying in. Answer yes and it becomes a payoff envelope you fund like any other; answer no and it needs no envelope at all.
Coming from Monarch, Copilot or Lunch Money
Cards already behave the way you expect.
You have never had a card payment category and you will not start now — payments are not expenses here either. What changes is when the decision gets made.
Carries over unchanged
- A card payment never touches your spending categories
- Charges are categorised where the spending happened
- Interest and fees show up as their own thing
The real change
Your budget stops being a target you are measured against and becomes a container you spend out of. A category can always absorb one more purchase; an envelope can be empty. That is the whole difference, and it is the reason people move.
Stop expecting
- A bank feed — you enter transactions, or import a statement
- Categories that fill themselves in overnight
- Finding out at month end: you find out at the till instead
What you gain for the typing
The answer arrives while you can still act on it, and no aggregator anywhere is holding a credential to your bank.
Two numbers worth knowing
Covered, carried, reserved, available.
Four words that sound alike and mean four different things. They are the reason the accounts screen can tell you something your banking app structurally cannot.
Covered
The part of a card balance from charges you made since starting here. Every one of them already came out of a category envelope, so the money to pay it is set aside somewhere.
Carried
The balance you brought in with you. No envelope has ever budgeted for it, which is why it gets a payoff envelope of its own and shows up as debt rather than as spending.
Reserved
The slice of your checking balance already spoken for by covered card charges. It is still in the account, but it is not yours to spend twice.
Available
Checking minus reserved. The number that answers “can I actually afford this”, and the one no bank app will ever show you, because it does not know what you have committed.
Loans work differently, and should
A loan does keep a payment envelope. The distinction is not arbitrary: a loan payment is money leaving for something you consumed long ago — a car, a degree — and there is no earlier transaction in your budget that already accounted for it. So the payment itself is the expense, it needs budgeting for every month, and an envelope is exactly the right place to put it.
A credit card charge, by contrast, always has an earlier transaction: the thing you bought, already sitting in Groceries or Fuel or Dining out. That is the entire difference, and it is why one gets an envelope and the other does not.
Credit card questions.
So where do I budget for the card bill?
You already did, at every purchase. When the bill arrives, the money is sitting in the envelopes you charged against — that is what the reserved figure on your checking account is telling you. Nothing further needs setting aside.
I came in owing $2,000 on a card. Now what?
Say yes to the carried-balance question when you add it. That $2,000 becomes a payoff envelope you fund like any other, and new charges behave normally on top of it. The account screen keeps the two halves separate so paying the card down never gets confused with paying this month’s spending.
What about interest and fees?
They inflate the card balance with no matching purchase behind them, so they surface as not covered — the balance grew without any envelope paying for it. That is self-detecting rather than something you have to remember to record, and reconciliation labels interest and fee lines automatically when it sees them on a statement.
A refund went back on the card.
The envelope goes up and the card balance goes down — the exact inverse of the purchase. Record it against the same envelope the original spending came from, and both sides land back where they started.
Do I have to keep the balances up to date by hand?
Only as accurately as you want the answers. Reserved and available are only as current as the balance you typed. If you want them provably right rather than roughly right, that is what the next chapter is for.
Cards, without the card homework.
Envelope discipline where it helps, and nothing extra to maintain where it does not.
Never Summer Mountains · mark byzewski, CC BY 2.0
