4 ms·

One of my favorite parts of GnuCash is the transaction splits, and I end up using these heavily. For one example, imagine an Amazon order. You order 3 things,

by neilv 3y ago

One of my favorite parts of GnuCash is the transaction splits, and I end up using these heavily. For one example, imagine an Amazon order. You order 3 things, partly paid for by CC card rewards, maybe a gift card, and a CC charge for the balance. With transaction splits, it's easy to put each thing you bought into the appropriate expense account with the correct cost, reconcile the CC charge correctly when your statement comes and you import the OFX/QFX data, and track your gift card balance. In GnuCash, that's all one transaction, with many splits. For expensive durable purchases, I'll sometimes also go and add the serial number to the text of the transaction split from when I purchased it, for lightweight home inventory without a separate program or redundant data entry about what/date/cost. Compare to a simpler personal finance program that just imports the CC charge and lets you tag it as a single expense category (or takes whatever the CC company says the category is), and if you ever need any more information, you're stuck with keeping a separate program or spreadsheet up-to-date. (You could use GnuCash the same way as the simpler personal finance program, but GnuCash has more powerful features that are there when you want them.)

nicolaslem 3y ago
Splits are also key for couples that maintain distinct finances. If I pay $100 for groceries, only half of that should show up in my monthly expense report, the other half belongs to my SO's expenses. Most of my GnuCash transactions are actually split transactions for this reason.
- lotsofpulp 3y ago
  You both eat around the same amount of food? I assume that most relationships have one person who has a bigger appetite than the other.
  - nicolaslem 3y ago
    You have to put the limit somewhere, anything else than splitting in half seems very tedious. Besides groceries is just one example of many expenses so I believe that differences get averaged out, and if they don't the two of us don't care about it.
    - lotsofpulp 3y ago
      > Besides groceries is just one example of many expenses so I believe that differences get averaged out, and if they don't the two of us don't care about it. Yes, that is where I was going with my line of questioning. What is the point of all that separating work if you don’t care about it not averaging out? Obviously, you do you, it’s just funny to me.
      - neilv 3y ago
        I can imagine that splitting the expenses is symbolic for some couples, more than anything else. Sometimes because history (e.g., didn't feel like an "equal partner" in a previous relationship). And for others, it might just be customary, or seem sensible. My situation has been different than that, in that I wished my GnuCash setup didn't incidentally quantify some categories of expenses so well. I've adjusted some categories since then. (Though it did make me think of a line of awful dialogue, for the worst rom-com jerk character ever.)
      - nicolaslem 3y ago
        What I am saying is that when we buy a new sofa we split the expense in two halves, we don't measure each second each of us spend sitting on it so that the split represents EXACTLY our individual usage. Same with groceries, we don't count each grain of rice each of us consume, we are okay with some level of inaccuracy. Anything besides that would be absolute madness. At the end of the month we still both get a pretty solid idea of our individual expenses no matter who actually paid of an item. For instance my expenses for the month are ¥2200 while last month it was ¥2500, seems like useful data, right? Who cares if one of us made a better deal than they should have on the sofa while the other consumed a few grams of rice more than other? I am surprised this inaccuracy makes you question the reason of tracking personal finance. Edit: > What is the point of all that separating work if you don’t care about it not averaging out? Maybe that's the source of the confusion, our finances are already separated, there is no extra work separating expenses. There is extra work for expenses we have in common like the sofa or groceries, in which case we do half and half even if that's sometimes inaccurate.
  - barefeg 3y ago
    Does splitting here mean each person pays half of the price of the shared item? If so that puts more pressure on the lower earner. One approach would be to put both incomes in a big pot, take all the shared expenses from that pot, and then divide and distribute the rest between the two.
    - tangent87 3y ago
      Me and my wife kind of do this. More specifically we contribute to family expenses proportionally to our income and we pay all family expenses from a shared bank account (fed with monthly contributions). Any personal expense is paid by our personal account. This guarantees that we do have the same saving rate and this feels to me much more fair that a 50/50 split.
      - brnt 3y ago
        If you end up with the same saving rate, couldn't just just unsplit that too?
        tangent87 3y ago
        As I mentioned above, we could not agree on how to use the savings.
      - barefeg 3y ago
        We started with something like this as well. The problem is that the savings and disposable income will also be proportional. If the difference in salaries is large then it could seem unfair. But then again it depends whether you view wealth as an individual or shared affair.
        tangent87 3y ago
        We do have pretty different incomes and working hours. Wealth is absolutelly a shared affair, but we could not get to agree on how to invest the savings. We have pretty different risk tolerance and asset class affinity, so we decided to split proportionally and grant each other freedom with whatever is not necessary for the family needs. Most likely we'll re-evalute the criteria in the future if absolute value of our savings diverge too much or if our investing choices will have markedly different ROIs.
- liotier 3y ago
  > couples that maintain distinct finances Is that an American custom, going as far as accounting for split groceries runs ?
  - gmane 3y ago
    While not general to all Americans, there's a minority subset of couples who do not combine household expenses. There's a bunch of reasons for this: if you are divorced, it can simplify some of the processes around alimony. If you had a bad relationship due to finances in the past, some people prefer financial independence, or if the couple have other complications that makes combining household finances complicated (like trusts, or property owned with a different party).
  - ezconnect 3y ago
    He used the term SO, so probably not married and they need the expense report for their tax.
    - oh_sigh 3y ago
      In what country would your groceries be an item on your tax reporting?
      - gizmo686 3y ago
        In some circumstances, the US. When calculating your taxable, you can deduct state and local taxes from your income for federal tax purposes. This is generally not worth it, since you would give up deducting your state income tax. Even then, the IRS recognizes that keeping track of what you pay in sales tax is unreasonable, so you are allowed to: a) deduct groceries as if they were taxed at the general rate, even if your state has exemptions for essenyials like food and b) ignore what you actually paid in sales tax entirely, and deduct an estimate based on your income and the tax rate. https://www.avalara.com/blog/en/north-america/2023/07/sales-tax-deduction.html https://www.avalara.com/blog/en/north-america/2023/07/sales-... https://www.irs.gov/instructions/i1040sca#en_US_2022_publink100041575 https://www.irs.gov/instructions/i1040sca#en_US_2022_publink... https://www.irs.gov/credits-deductions/individuals/use-the-sales-tax-deduction-calculator https://www.irs.gov/credits-deductions/individuals/use-the-s...
mbork_pl 3y ago
I think any accounting software can (should?) support that. Ledger-cli certainly does. (I used GnuCash for several years and then moved to ledger.)
- wredue 3y ago
  Lots of budget software certainly doesn’t, and even when it does, directing the splits to the appropriate account is impossible. You Need A Budget stands out as an amazingly useless piece of software that also, for some reason, comes highly recommended.
  - mbork_pl 3y ago
    budget software ≠ accounting software
    - wredue 3y ago
      The entire purpose of a budget is to compare to your cumulative account postings on a period. If your accounting is garbage, then the budget will be similarly useless.
  - nimbleplum40 3y ago
    What about it is useless? I’ve found it to be incredibly useful. And prior to that I used ledger for a few years. Ledger was great, but personally I find YNAB to be more useful because the budgeting features are the focus, not the accounting.
  - deleted 3y ago
    [deleted]
  - jwineinger 3y ago
    Maybe I'm outside the norm, but as a YNAB user of over 10 years, I've never needed this. We split transactions across multiple categories all the time (shopping at Target for groceries, clothing, household goods, etc), but I expect that is very common. I don't think YNAB philosophy would have you tracking reward or gift card balances, so you'd only track the amount that hit your CC, in this example. In that regard, YNAB certainly isn't a tool to track all of your monetary assets. Is it common to split a single transaction across multiple accounts?

by neilv 3y ago

nicolaslem 3y ago

Splits are also key for couples that maintain distinct finances. If I pay $100 for groceries, only half of that should show up in my monthly expense report, the other half belongs to my SO's expenses. Most of my GnuCash transactions are actually split transactions for this reason.

lotsofpulp 3y ago
You both eat around the same amount of food? I assume that most relationships have one person who has a bigger appetite than the other.
- nicolaslem 3y ago
  You have to put the limit somewhere, anything else than splitting in half seems very tedious. Besides groceries is just one example of many expenses so I believe that differences get averaged out, and if they don't the two of us don't care about it.
  - lotsofpulp 3y ago
    > Besides groceries is just one example of many expenses so I believe that differences get averaged out, and if they don't the two of us don't care about it. Yes, that is where I was going with my line of questioning. What is the point of all that separating work if you don’t care about it not averaging out? Obviously, you do you, it’s just funny to me.
    - neilv 3y ago
      I can imagine that splitting the expenses is symbolic for some couples, more than anything else. Sometimes because history (e.g., didn't feel like an "equal partner" in a previous relationship). And for others, it might just be customary, or seem sensible. My situation has been different than that, in that I wished my GnuCash setup didn't incidentally quantify some categories of expenses so well. I've adjusted some categories since then. (Though it did make me think of a line of awful dialogue, for the worst rom-com jerk character ever.)
    - nicolaslem 3y ago
      What I am saying is that when we buy a new sofa we split the expense in two halves, we don't measure each second each of us spend sitting on it so that the split represents EXACTLY our individual usage. Same with groceries, we don't count each grain of rice each of us consume, we are okay with some level of inaccuracy. Anything besides that would be absolute madness. At the end of the month we still both get a pretty solid idea of our individual expenses no matter who actually paid of an item. For instance my expenses for the month are ¥2200 while last month it was ¥2500, seems like useful data, right? Who cares if one of us made a better deal than they should have on the sofa while the other consumed a few grams of rice more than other? I am surprised this inaccuracy makes you question the reason of tracking personal finance. Edit: > What is the point of all that separating work if you don’t care about it not averaging out? Maybe that's the source of the confusion, our finances are already separated, there is no extra work separating expenses. There is extra work for expenses we have in common like the sofa or groceries, in which case we do half and half even if that's sometimes inaccurate.
- barefeg 3y ago
  Does splitting here mean each person pays half of the price of the shared item? If so that puts more pressure on the lower earner. One approach would be to put both incomes in a big pot, take all the shared expenses from that pot, and then divide and distribute the rest between the two.
  - tangent87 3y ago
    Me and my wife kind of do this. More specifically we contribute to family expenses proportionally to our income and we pay all family expenses from a shared bank account (fed with monthly contributions). Any personal expense is paid by our personal account. This guarantees that we do have the same saving rate and this feels to me much more fair that a 50/50 split.
    - brnt 3y ago
      If you end up with the same saving rate, couldn't just just unsplit that too?
      - tangent87 3y ago
        As I mentioned above, we could not agree on how to use the savings.
    - barefeg 3y ago
      We started with something like this as well. The problem is that the savings and disposable income will also be proportional. If the difference in salaries is large then it could seem unfair. But then again it depends whether you view wealth as an individual or shared affair.
      - tangent87 3y ago
        We do have pretty different incomes and working hours. Wealth is absolutelly a shared affair, but we could not get to agree on how to invest the savings. We have pretty different risk tolerance and asset class affinity, so we decided to split proportionally and grant each other freedom with whatever is not necessary for the family needs. Most likely we'll re-evalute the criteria in the future if absolute value of our savings diverge too much or if our investing choices will have markedly different ROIs.
liotier 3y ago
> couples that maintain distinct finances Is that an American custom, going as far as accounting for split groceries runs ?
- gmane 3y ago
  While not general to all Americans, there's a minority subset of couples who do not combine household expenses. There's a bunch of reasons for this: if you are divorced, it can simplify some of the processes around alimony. If you had a bad relationship due to finances in the past, some people prefer financial independence, or if the couple have other complications that makes combining household finances complicated (like trusts, or property owned with a different party).
- ezconnect 3y ago
  He used the term SO, so probably not married and they need the expense report for their tax.
  - oh_sigh 3y ago
    In what country would your groceries be an item on your tax reporting?
    - gizmo686 3y ago
      In some circumstances, the US. When calculating your taxable, you can deduct state and local taxes from your income for federal tax purposes. This is generally not worth it, since you would give up deducting your state income tax. Even then, the IRS recognizes that keeping track of what you pay in sales tax is unreasonable, so you are allowed to: a) deduct groceries as if they were taxed at the general rate, even if your state has exemptions for essenyials like food and b) ignore what you actually paid in sales tax entirely, and deduct an estimate based on your income and the tax rate. https://www.avalara.com/blog/en/north-america/2023/07/sales-tax-deduction.html https://www.avalara.com/blog/en/north-america/2023/07/sales-... https://www.irs.gov/instructions/i1040sca#en_US_2022_publink100041575 https://www.irs.gov/instructions/i1040sca#en_US_2022_publink... https://www.irs.gov/credits-deductions/individuals/use-the-sales-tax-deduction-calculator https://www.irs.gov/credits-deductions/individuals/use-the-s...

mbork_pl 3y ago

I think any accounting software can (should?) support that. Ledger-cli certainly does. (I used GnuCash for several years and then moved to ledger.)

wredue 3y ago
Lots of budget software certainly doesn’t, and even when it does, directing the splits to the appropriate account is impossible. You Need A Budget stands out as an amazingly useless piece of software that also, for some reason, comes highly recommended.
- mbork_pl 3y ago
  budget software ≠ accounting software
  - wredue 3y ago
    The entire purpose of a budget is to compare to your cumulative account postings on a period. If your accounting is garbage, then the budget will be similarly useless.
- nimbleplum40 3y ago
  What about it is useless? I’ve found it to be incredibly useful. And prior to that I used ledger for a few years. Ledger was great, but personally I find YNAB to be more useful because the budgeting features are the focus, not the accounting.
- deleted 3y ago
  [deleted]
- jwineinger 3y ago
  Maybe I'm outside the norm, but as a YNAB user of over 10 years, I've never needed this. We split transactions across multiple categories all the time (shopping at Target for groceries, clothing, household goods, etc), but I expect that is very common. I don't think YNAB philosophy would have you tracking reward or gift card balances, so you'd only track the amount that hit your CC, in this example. In that regard, YNAB certainly isn't a tool to track all of your monetary assets. Is it common to split a single transaction across multiple accounts?