Income fill vs. Credit transaction

I receive an income several times a month (apart from my regular job) that will fill one envelope. What are the pros and cons of making it an income fill transaction verses just a credit transaction. I think I know the answer, but not positive and would like to hear from others. Thanks!

I’m curious too, and I suspect the biggest difference is in your reports. I don’t think a credit shows up as income, so your income-to-spend ratio would look wonky. I only think of credits as offsets to charges—an item I returned, a rebate on a purchase, etc. When “new” money comes in I always record it as income, although I suspect either one would affect your balances equally.


Thank you Tiffany for your input!

Tiffany’s comment highlights the main difference: your Reports will be different. In addition to the Income v Spending Report she mentioned, your other Spending Reports will also all look different, because Credits decrease the amount of Spending that accumulates for the purposes of those Reports. In an extreme case, if you recorded all of your yearly Income as Credits, and made more than you spent, your Spending Reports would be completely blank!

Another issue involves the calculations for certain Envelopes. For example, Annual and Goal Envelopes with Due Dates calculate the budgeted amount based off the amount you’ve Filled in the past, rather than off the current balance. Because Credits aren’t Fills, they’ll never show you as having saved any amount, and will prompt you with incorrect budgeted amounts.

Because of these reasons (and I might even be missing some other smaller ones that I couldn’t think of off the top of my head), generally we don’t recommend using Credits for anything other than reimbursements or refunds.


Thank you Alex for your thorough explanation!

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