Managing Shared Credit Cards
You share a credit card with someone, but you don’t share a budget with them—this Help Doc will explain how to handle this scenario in your budget.
If you’re just getting started with YNAB, check out our Credit Card Basics first!
The following setup can apply to sharing a credit card with an authorized user, a partner or spouse, a parent, or even sharing a credit card with your small business. For the information below we’ll use the word “partner,” but keep in mind that this fits almost all shared credit card situations.
Tracking your transactions
YNAB automatically sets aside cash for your current credit card spending, as long as your categories are funded. However, you may not want the budget to set your cash aside for your partner's spending on the card. Here’s how to account for transactions from this shared card in your personal budget:
- You’ll need each and every spending transaction to be represented in the account register, whether you or your partner swiped the card. You can use direct import, File-Based Import, and/or manual entry, but every transaction that happens on the card needs to be in YNAB for the account to be accurate.
- Create a category where you will categorize your partner's spending on the card (or split portions of their spending). Do not assign any money to that category, and let it remain overspent. If you’re not responsible for a specific spending transaction, categorize it to your partner's category. That category will stay yellow and overspent until a payment is made.
- Categorize your transactions to your spending categories like normal. If any overspending pops up in your categories, cover that as soon as you can. You can create a Split Transaction if you and your partner are each partially responsible for the charge.
- Reconcile often. Reconciling regularly is always a good idea, but it’s especially important when someone else’s spending is affecting your budget.
When the time comes to make the payment, here's how to make sure both your and your partner's money is available to pay down the card:
- Always settle up at the end of the calendar month, not at the end of the credit card billing cycle. This is key!
- Check how much your partner owes. If you’ve been categorizing your partner’s transactions to their category, the yellow, negative amount should equal how much they owe you at the end of the month. You can always double check the amount by tallying your partner's transactions for the month on the credit card's website.
- Have your partner transfer money into your Budget checking account to cover their spending on the card. This is preferable to having them pay the card, as it requires more complex steps in your budget if they pay it directly.
- When the money comes into your checking account, categorize it as an inflow directly to your partner’s category. This reimbursement resolves the overspending and zeroes out your partner’s spending. You will see the money will move to the card’s Credit Card Payment category.
- Pay the credit card bill. If you’re not paying the card right away, that money will roll over with your portion of the payment. When the bill is due, you’ll have the money you need to send to the credit card company!
If you have more complexity in your transactions (you pay this person back for some of their spending and they pay you back for some of yours), we recommend using an app like Splitwise to keep track of who owes who. Here are some recommendations on how to use Splitwise and YNAB!