Chapter 6. Managing Credit Cards
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## Chapter 6. Managing Credit Cards

This chapter will explain how to manage your credit cards using GnuCash. Since you probably write a check to the credit card company each month, you may think of your credit card bill as an expense - but it really is not an expense. Why? A credit card account is a short-term loan - you buy things on that loan account, and then you eventually have to pay back the money, often with interest (your finance charge). The purchases you make with that credit card are your expenses.

You have a couple of options when entering credit card transactions, so choose the one that fits your desired level of detail. The basic level of detail is to simply track monthly payments to the credit card company. From your checking account, you can enter a transfer of money each month to the credit card account. This will show you the amount of money you are paying each month to the credit card company, but it won't show you any information about your credit card balance or credit card purchases.

The other level of detail allows you to track your balance and purchases, but it requires more entry. Using the credit card account register, you enter your receipts throughout the month. When your credit card statement arrives, you reconcile the credit card account to the statement, and you enter your payment as a transfer of money from your checking account to your credit card account. This method, in addition to giving you more information about your balance during the month, also points out any discrepancies quickly during reconciliation.

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5.5. Putting It All Together | Up | 6.1. Setting Up Accounts