A Budget Proposal - Virtual Accounts

[Mike or Penny Novack]

On 1/14/2016 1:29 PM, Andrew Beard wrote:

>
> Thanks for the comments.
>
> I think you're missing the main point of my proposal.  Yes, I can get 
> by with GNUcash by exactly mimicking the process and creating 
> subaccounts for each and every envelope.  With a cash asset account, 
> this is particular easy to do.  But think now of a checking account 
> which I wish to budget out of.  I can't actually place the money in 
> envelopes and the bank doesn't support 'sub-accounts' or 'sub-account' 
> transfers based on the whims of my budget.  As a result, when I try to 
> balance my checkbook and reconcile with my bank, the bank balance does 
> not reflect my checking account ledger balance.

Well I do this and have no particular problem reconciling. I was 
specifically describing the situation where a number of "restricted" 
funds might be held in the same checking account. Do you understand 
parent-child account set ups? The TOTAL in the checking account (to be 
reconciled against the banks total) would be the parent balance. Actual 
deposits, checks, and bank charges in the child for that, and then the 
restricted amounts in those children (the "envelopes" in your case; 
informally* donor restricted funds in mine).

The issue of having to enter all parts of the transaction is what I 
think you are concerned about. But with my other (non-budget) examples I 
was pointing out that this is just something we encounter not just with 
"envelope budgeting" and something you have to do (at least in my case).

Michael



* Legally restricted donor funds are accounted for by liabilities, and 
an organization might have a separate account for those.