We started talking about this in regard to my denied request for hierarchical accounts, but I think this might be of more General interest.
Let me see if I understand how to use Prepaid accounts:
If I want to save for a car and a TV, but keep the actual money in one savings account at the bank, I'd make two Prepaid Accounts:
Car
TV
and one Savings account:
Savings
The Savings account will show what's at the bank.
Each time I save $1000 for the Car, I enter a $1000 transaction from the Car account to the Auto budget category.
Then, when I buy the car, I enter a transaction for $10000 from the Savings account to the Car account.
So Buddi doesn't do anything to link the Car, TV, and Savings accounts.
My net worth goes down every time I save $1000, but that's just because I want the car . If I decide not to get a car and learn to rely on the bus, I'd enter a transcation that would clear out the Car account - I guess maybe from the Auto budget category to the Car account - and my net worth would go up, but that's just because I changed my mind about what I'm saving for. (ah ha - now I see why anonymous wants that check mark feature)
Also, I have to just remember that if I have $7000 in Savings, $5000 in Car, and $2000 in TV, I can't put another $1000 in a new Computer Prepaid account.
Sound right ?
I think it might help if I put say the bank account number into the names, so the Prepaid Accounts would be named "Car [12345]", "TV [12345]", "Computer [12345]" and the Savings account would be "Savings [12345]".
Or is this not really a problem for people who use Prepaid accounts ?
If you would like to refer to this comment somewhere else in this project, copy and paste the following link:
Yes, this is exactly correct. The premise of prepaid accounts is basically 'I owe money to myself for a particular item'. That is why it shows up as a liability account, and it decreases your net worth. As far as Buddi is concerned, you have already spent this money: If you look at your reports for these items, you will see the monthly $50 charge from your 'Saving for TV' budget category going into 'Prepaid TV' account, but you will not see the $150 charge when you actually buy the TV after 3 months. This is because you already paid for it, and it would not make sense to record it as an expense again.
As for your naming scheme, if that helps you to remember where the money is supposed to come from, so much the better. 8-) Account names are free form text, so you can call them whatever you want.
On a slightly different note, there seems to be quite a bit of confusion with my method of describing prepaid accounts. If anyone out there has already figured it out is able to modify my tutorial to better describe how they work, feel free to send it to me, and I will post your comments in addition to / in place of my existing ones.
Cheers
--Wyatt
If you would like to refer to this comment somewhere else in this project, copy and paste the following link:
I just noticed that if I click "Show Account Types" in the preferences, the types act just like the hierarchical accounts I was looking for.
So, I could make Car, TV and Computer all savings type accounts, then add a General one, and I could have :
Savings 7020
General 20
Car 5000
TV 2000
Computer 0
Then, if I have 7020 in the bank, I can see that there's no money for a computer . If I decide not to get a car, I can transfer the Car money to General and my net worth isn't affected. This seems a little more realistic and useful than prepaid accounts.
If I used Buddy accounts like this though, I'd want to be able to add and delete account types. It even seems like I can do this with 1.8.0 by editing the data file directly.
If you would like to refer to this comment somewhere else in this project, copy and paste the following link:
If this is what you want, feel free to use it 8-) Technically, this is not what the 'show account types' does, and when using it like this, it does not correctly follow accounting practices. However, if it helps you keep track of your money and budget more effectively, then all the more power to you!
Let me know if you do end up adding new account types - I was planning on phasing that out of the data file, in preference to having it hardcoded in the program. This would allow users with existing data files to benefit from updates to account types (for instance, Prepaid Accounts) without having to manually modify the data file. However, if people are actually using this feature, I will just keep it how it currently is.
Cheers
--Wyatt
If you would like to refer to this comment somewhere else in this project, copy and paste the following link:
I'm still not comfortable with using Prepaid accounts; it seems too easy to forget about them and then not have the money when the expense comes up.
You said you implemented these in leu of hierarchical accounts.
What were the problems with hierarchical accounts ?
I'm also not comfortable relying on a feature (the ability to add account types by hand editing the data file)
that intereferes with the smooth progress of the project.
If you would like to refer to this comment somewhere else in this project, copy and paste the following link:
The reason I did not implement hierarchal accounts is because there is no real world equivalent. Banks do not provide sub accounts. They give you (multiple, if desired) accounts of different types. If I were to have implemented hierarchal accounts, it would (in my mind) be very confusing, because there is no real world equivalent.
I do agree with you that Prepaid accounts are confusing at first; however, once you understand them, they are very easy to use and much more robust than hierarchal accounts would be. Besides, using a credit account like this is the standard - I have talked to real world accountants about how to do this, and this is the procedure they recommended.
In addition to what I have already mentioned, Prepaid accounts are better than hierarchal accounts because the data is more compatible with other programs. Assuming a plugin is written for it, Buddi data can be exported to, say, Quicken format, or MS Money, or GNU Cash. If I use Hierarchal accounts, this would not be possible. Even those who use use paper and pencil to record finances will have a direct equivalent when using Buddi if Prepaid accounts are used; if I implemented Hierarchal accounts, this would not be possible.
In short, yes, I agree that the learning curve for Prepaid accounts is higher than I would like it to be. I wish that I was better at explaining them. I also agree that it is one of the features which does not fit with Buddi's target user base of people who have never done accounting before. However, I don't think that hierarchal accounts would be any better. When I was deciding on which of these to implement, I asked many different people from different backgrounds (accountant, non accountant) which would make more sense; Prepaid accounts got the vote.
I'm really sorry if you don't think this implementation method is the right one, but I'm afraid that I have done my research, and will not be implementing this.
On the other hand, if you are interested in changing / adding account types via the Buddi interface, I can definitely do something about that. I will look into it for the 2.1 Devel / 2.2 Stable release. Feel free to add a feature request for it to remind me to include it.
Sorry I can't do more, and I hope you can at least understand, if not agree with, my reasoning behind that decision.
Cheers
--Wyatt
If you would like to refer to this comment somewhere else in this project, copy and paste the following link:
I'd be really happy with a Buddi UI for new account types and will put in a feature request like you suggest. I think I misunderstood what you meant when you said you wanted to hard code them into Buddi - if it's done just like budget categories are then that's fine with me.
I guess I question your strategy of limiting Buddi features to things with real-world equivalents. Most banks have on-line interfaces now, so if all I wanted were real-world equivalents I could just use the real thing.
The main advantage that Buddi gives me is the flexability to do things to ehance the real-world tools I already have. By (mis)uing account types the way I do, I have the advantage of several savings accounts while only having to pay the bank for the one real one.
BTW -
I like the highlighting and striping in the post-1.9.1 releases
If you would like to refer to this comment somewhere else in this project, copy and paste the following link:
No, you didn't misunderstand my previous statement about hardcoding the account types. I was planning on that, since I didn't see any use for having them in the data file. You have shown me that I was wrong in that regard. I no longer have any plans for removing them. 8-)
I do see your point about how I should not be limiting Buddi to previous (possibly incorrect) analogies... If in the future I can figure out something that will bypass the limitations which I am concerned about, I may consider adding something like this later on.... Regardless, (and hopefully not having anything to do with my paternal pride for Buddi), I do suggest that you look deeper into prepaid accounts. As I mentioned, this *is* the industry standard for doing this, and I do find that it works quite well, once you understand the concepts.
You also have a point about forgetting that you have the money there, and possibly spending it elsewhere. If you can think of some way (from a User Interface point of view) to link the two so that you do not spend what is already put aside, please let me know and I can see about including it. If you do this, try to be as specific as possible, and say what (from a User point of view) the user would do to use this. (If you are from a CS background at all, I'm asking for a use case). For instance, "When creating an account, click on the checkbox which links the prepaid account to a real account. When you add money to a prepaid account, by specifying it in the 'To' pulldown in the transactions window, it should decrease the amount in the debit account it is linked to.".... and so on like that. The more clear it is (and the better I can envision what you are), the more likely I will be to include it.
Cheers
--Wyatt
If you would like to refer to this comment somewhere else in this project, copy and paste the following link:
I'm beginning to see the error of my ways about this.
Having two separate accounts as the same type,
and using the type as the bank account creates two
problems:
1 - I noticed that I started wanting
to do this with my credit card
account ; in order to make sure
I set aside the money, I was thinking
about attaching the credit card
account to the account I intended to
pay it from. This would quickly get
out of hand.
2 - When it comes time to reconcile, it's
confusing to have to deal with these
"pseudo transfers" between accounts
that are really the same bank account.
I still think that being able to define account types
would be useful, but Prepaid accounts is probably a
better way to set aside funds for future expenses.
If you would like to refer to this comment somewhere else in this project, copy and paste the following link:
Good to hear you're coming around ;-) JK, but it is goo to know that I'm not completely wrong on the methods I suggest for people to use...
If you get more famililar with them, and are able to put together some sort of tutorial for others, I'm sure that many people would find that very useful.
Cheers
--Wyatt
If you would like to refer to this comment somewhere else in this project, copy and paste the following link:
We started talking about this in regard to my denied request for hierarchical accounts, but I think this might be of more General interest.
Let me see if I understand how to use Prepaid accounts:
If I want to save for a car and a TV, but keep the actual money in one savings account at the bank, I'd make two Prepaid Accounts:
Car
TV
and one Savings account:
Savings
The Savings account will show what's at the bank.
Each time I save $1000 for the Car, I enter a $1000 transaction from the Car account to the Auto budget category.
Then, when I buy the car, I enter a transaction for $10000 from the Savings account to the Car account.
So Buddi doesn't do anything to link the Car, TV, and Savings accounts.
My net worth goes down every time I save $1000, but that's just because I want the car . If I decide not to get a car and learn to rely on the bus, I'd enter a transcation that would clear out the Car account - I guess maybe from the Auto budget category to the Car account - and my net worth would go up, but that's just because I changed my mind about what I'm saving for. (ah ha - now I see why anonymous wants that check mark feature)
Also, I have to just remember that if I have $7000 in Savings, $5000 in Car, and $2000 in TV, I can't put another $1000 in a new Computer Prepaid account.
Sound right ?
I think it might help if I put say the bank account number into the names, so the Prepaid Accounts would be named "Car [12345]", "TV [12345]", "Computer [12345]" and the Savings account would be "Savings [12345]".
Or is this not really a problem for people who use Prepaid accounts ?
Yes, this is exactly correct. The premise of prepaid accounts is basically 'I owe money to myself for a particular item'. That is why it shows up as a liability account, and it decreases your net worth. As far as Buddi is concerned, you have already spent this money: If you look at your reports for these items, you will see the monthly $50 charge from your 'Saving for TV' budget category going into 'Prepaid TV' account, but you will not see the $150 charge when you actually buy the TV after 3 months. This is because you already paid for it, and it would not make sense to record it as an expense again.
As for your naming scheme, if that helps you to remember where the money is supposed to come from, so much the better. 8-) Account names are free form text, so you can call them whatever you want.
On a slightly different note, there seems to be quite a bit of confusion with my method of describing prepaid accounts. If anyone out there has already figured it out is able to modify my tutorial to better describe how they work, feel free to send it to me, and I will post your comments in addition to / in place of my existing ones.
Cheers
--Wyatt
I just noticed that if I click "Show Account Types" in the preferences, the types act just like the hierarchical accounts I was looking for.
So, I could make Car, TV and Computer all savings type accounts, then add a General one, and I could have :
Savings 7020
General 20
Car 5000
TV 2000
Computer 0
Then, if I have 7020 in the bank, I can see that there's no money for a computer . If I decide not to get a car, I can transfer the Car money to General and my net worth isn't affected. This seems a little more realistic and useful than prepaid accounts.
If I used Buddy accounts like this though, I'd want to be able to add and delete account types. It even seems like I can do this with 1.8.0 by editing the data file directly.
If this is what you want, feel free to use it 8-) Technically, this is not what the 'show account types' does, and when using it like this, it does not correctly follow accounting practices. However, if it helps you keep track of your money and budget more effectively, then all the more power to you!
Let me know if you do end up adding new account types - I was planning on phasing that out of the data file, in preference to having it hardcoded in the program. This would allow users with existing data files to benefit from updates to account types (for instance, Prepaid Accounts) without having to manually modify the data file. However, if people are actually using this feature, I will just keep it how it currently is.
Cheers
--Wyatt
I'm still not comfortable with using Prepaid accounts; it seems too easy to forget about them and then not have the money when the expense comes up.
You said you implemented these in leu of hierarchical accounts.
What were the problems with hierarchical accounts ?
I'm also not comfortable relying on a feature (the ability to add account types by hand editing the data file)
that intereferes with the smooth progress of the project.
The reason I did not implement hierarchal accounts is because there is no real world equivalent. Banks do not provide sub accounts. They give you (multiple, if desired) accounts of different types. If I were to have implemented hierarchal accounts, it would (in my mind) be very confusing, because there is no real world equivalent.
I do agree with you that Prepaid accounts are confusing at first; however, once you understand them, they are very easy to use and much more robust than hierarchal accounts would be. Besides, using a credit account like this is the standard - I have talked to real world accountants about how to do this, and this is the procedure they recommended.
In addition to what I have already mentioned, Prepaid accounts are better than hierarchal accounts because the data is more compatible with other programs. Assuming a plugin is written for it, Buddi data can be exported to, say, Quicken format, or MS Money, or GNU Cash. If I use Hierarchal accounts, this would not be possible. Even those who use use paper and pencil to record finances will have a direct equivalent when using Buddi if Prepaid accounts are used; if I implemented Hierarchal accounts, this would not be possible.
In short, yes, I agree that the learning curve for Prepaid accounts is higher than I would like it to be. I wish that I was better at explaining them. I also agree that it is one of the features which does not fit with Buddi's target user base of people who have never done accounting before. However, I don't think that hierarchal accounts would be any better. When I was deciding on which of these to implement, I asked many different people from different backgrounds (accountant, non accountant) which would make more sense; Prepaid accounts got the vote.
I'm really sorry if you don't think this implementation method is the right one, but I'm afraid that I have done my research, and will not be implementing this.
On the other hand, if you are interested in changing / adding account types via the Buddi interface, I can definitely do something about that. I will look into it for the 2.1 Devel / 2.2 Stable release. Feel free to add a feature request for it to remind me to include it.
Sorry I can't do more, and I hope you can at least understand, if not agree with, my reasoning behind that decision.
Cheers
--Wyatt
I'd be really happy with a Buddi UI for new account types and will put in a feature request like you suggest. I think I misunderstood what you meant when you said you wanted to hard code them into Buddi - if it's done just like budget categories are then that's fine with me.
I guess I question your strategy of limiting Buddi features to things with real-world equivalents. Most banks have on-line interfaces now, so if all I wanted were real-world equivalents I could just use the real thing.
The main advantage that Buddi gives me is the flexability to do things to ehance the real-world tools I already have. By (mis)uing account types the way I do, I have the advantage of several savings accounts while only having to pay the bank for the one real one.
BTW -
I like the highlighting and striping in the post-1.9.1 releases
No, you didn't misunderstand my previous statement about hardcoding the account types. I was planning on that, since I didn't see any use for having them in the data file. You have shown me that I was wrong in that regard. I no longer have any plans for removing them. 8-)
I do see your point about how I should not be limiting Buddi to previous (possibly incorrect) analogies... If in the future I can figure out something that will bypass the limitations which I am concerned about, I may consider adding something like this later on.... Regardless, (and hopefully not having anything to do with my paternal pride for Buddi), I do suggest that you look deeper into prepaid accounts. As I mentioned, this *is* the industry standard for doing this, and I do find that it works quite well, once you understand the concepts.
You also have a point about forgetting that you have the money there, and possibly spending it elsewhere. If you can think of some way (from a User Interface point of view) to link the two so that you do not spend what is already put aside, please let me know and I can see about including it. If you do this, try to be as specific as possible, and say what (from a User point of view) the user would do to use this. (If you are from a CS background at all, I'm asking for a use case). For instance, "When creating an account, click on the checkbox which links the prepaid account to a real account. When you add money to a prepaid account, by specifying it in the 'To' pulldown in the transactions window, it should decrease the amount in the debit account it is linked to.".... and so on like that. The more clear it is (and the better I can envision what you are), the more likely I will be to include it.
Cheers
--Wyatt
I'm beginning to see the error of my ways about this.
Having two separate accounts as the same type,
and using the type as the bank account creates two
problems:
1 - I noticed that I started wanting
to do this with my credit card
account ; in order to make sure
I set aside the money, I was thinking
about attaching the credit card
account to the account I intended to
pay it from. This would quickly get
out of hand.
2 - When it comes time to reconcile, it's
confusing to have to deal with these
"pseudo transfers" between accounts
that are really the same bank account.
I still think that being able to define account types
would be useful, but Prepaid accounts is probably a
better way to set aside funds for future expenses.
Good to hear you're coming around ;-) JK, but it is goo to know that I'm not completely wrong on the methods I suggest for people to use...
If you get more famililar with them, and are able to put together some sort of tutorial for others, I'm sure that many people would find that very useful.
Cheers
--Wyatt