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Credit Card Managment

yes, I too would like the credit card account can be hooked to the bank account that generates a monthly debit transaction the bank account in a day fixed by us

 


11 people like this idea

I also need to receive all details of my monthly Visa transactions.



Hello,

thank you for posting on our forum. Managing credit cards is a broad subject as they really vary from bank to bank, country to country. Still there are common principles and many tricks to make managing them a breeze and keep you in charge. We have opened a new section where to discuss specific financial situations and how MoneyWiz would handle them best. We named it "Financial Health". Still, since you have opened the subject let's debate it here first.


Paying the credit card


Each card cycle you need to know how much you have already spent so that you pay the car off on the Due date. 


Do you always manage to return the money before they are overdue or you will need to revolve the card?


In either case - whether paying the whole amount due or making Partial Payments (this is slightly different from instalments)  - part of the amount is for the Principal (Credit Limit) - the money that re-charge the card so to say. The second part is either an interest or in some cases a fixed fee that the bank withholds for revolving the amount due. 


So, say you have a credit card with Ƀ1000 credit limit, and you spend Ƀ200 during the current revolution period of the card, this amount becomes immediately due by a certain date. The date may vary as well as the conditions in the contract with the bank, but I digress. If the amount due is not paid entirely by the cards revolution date then the arranged Interest/Fee become due. 


If you pay the entire amount due on the Card (Ƀ200), the credit limit will be restored, and no fees are applied. Job well done. Most cards have a grace period that varies from region to region. This is what limits us in directly displaying the Due amount, unless you generate Trends with Custom Period. Many cards do not revolve on the 1st of the Month, or some standard date, say for the example we use a 45 days grace period. This could mean that if the card revolves around the 1st of the Month, and we spent the Ƀ200 on that day, the money will become due not on the next 1st, but +45 days, or the 15th of the month following the first revolve date. 


Yet, sometime we really use the card for emergencies and we didn't bought something now, because we knew next month we will be better off. Sometimes one might need to cover for something delayed or something that one couldn't really foresee. Without savings to back you up at that time, the card comes in handy as a very quick solution. Sometimes you might need to cover, say a web hosting fee to keep the store running and expect better sales. In any of these cases you will get past the due date and will not restore the entire amount that is owed to the bank. Then you might pay, say, 10% of Ƀ200 + return any amount you chose (Ƀ50) thus setting the size of the periodic payments which will be due on the card until the Ƀ200 are returned. 


The interest in many case is accrued each time the card revolve i.e. if you pay Ƀ20 + Ƀ50, the next period you will owe to pay the 10% of Ƀ150 + return amount. With keeping the amount we return for the principal to Ƀ50 it will take 4 months/revolutions to restore the Ƀ200 we spent at the beginning of this example. Each cycle though the interest fee will decrease, first period it was Ƀ20 (200*10/100), for the second it will be Ƀ15 (150*10/100), third - 10, and the last one will be only Ƀ5. After the last payment has gone through, the credit limit of the card will be restored to Ƀ1000, and on the next period no fees will be due. 


So, although covering these may be arranged with the bank, at once, the two types of transactions are present - Transfer and Expense. To completely pay the card, every month, create a Scheduled/Programed Transfer transaction with the revolution date of the card, From the banking account - often called Checking, Cuenta Corriente, Current, Debit, Transactional, Разплащателна сметка and many others - you use to pay off the card to the Card account. When time to pay the transaction, run a Trends report, for most credit cards you would need to use Custom Period, to see the amount of money used during the card cycle.


If you need to pay some fee to the bank, you will need to create a Scheduled/Programed Transfer and a Scheduled/Programed Expense. The amount that the bank withholds for revolving the card contains part principal part interest too.

The great difficulty is that this amount is usually calculated with the formula as per the conditions of the Card and my example above may not best reflect other situations. So, in most cases we do not know how much is the principal (the transfer to restore part of the balance on the card) is and how much is the interest fee (Expense). Reviewing the Card terms and condition is one quick way to see how to see this. Share it with us so we can think it out too.


If 1st of April, Expense = Ƀ200 then
1st of May the card revolves for the first time. 
15th of June is when the Ƀ200 becomes Overdue and interest/fee of Ƀ20 is charged along with minimal principal payment.
1st of June card revolves and the amount is recalculated, but the grace period is re-activated too. 
1st of July the remaining amount becomes Overdue. The interest of Ƀ15 is charged along with the Transfer for the minimal principal payment.
. . .
and so until the principal amount of Ƀ200 is restored to the card and you have spent Ƀ50 for banking services.

  And this is just one type. 


In case you return the Principal amount on smaller amounts, you extend the time you will pay it, which accumulates bigger fees than Ƀ50 as in the example above.


In case with the instalments, frequently the interest is fixed amount calculated for the whole duration of the instalment payments and paid separately or included in the total amount of the instalment. What is more common in your 


Example of type 2. Instalments require a different approach. The fee in this cases is fixed for the whole period and the principal is returned in equal payments. So, when you use the card to buy say something that cost Ƀ1000, you need to add one Expense in the credit Card account, for Ƀ1000, so the card shows as negative. Then add a Scheduled Transfer From the bank account you will transfer To the credit Card, that recurs on any date you choose, then select when the transaction should end i.e. in five months.


Ideally, the scheduled Transaction would get the amount by generating a specifically designed report, and then loading the ready amount into the Scheduled Transfer/Income. There is a solution to the problem with the cycle of the card, but we are still working on it, so I would prefer not to go into further detail right now.


Keep out of debt as much as possible and do not despair to do it. I hope that having a discussion on such variable subjects can help us all to keep up to this : -)  Thank you for reading, I hope I did not bored you too much. 


What other scenarios come to your minds when you think of this? Tell us about how your bank card schemes works!

You wrote: "If you pay the entire amount due on the Card (Ƀ200), the credit limit will be restored, and no fees are applied. Job well done."  This is my case. No interest fees, no partial payments. Dot


My demand is about the different expenses I made with my  Credit Card during last month. 


If MoneyWizz enters my bank account, finds new movements and send the details to my MW account why does not send me detail of the above mentioned Credit Card expenses?

Any solution from MoneyWizz ?

Any progress on it ?

Hello,

I'm afraid we have no details to share about the implementation of this feature just yet.
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