> ## Documentation Index
> Fetch the complete documentation index at: https://docs.budgetbandit.io/llms.txt
> Use this file to discover all available pages before exploring further.

# Account types

> The seven account types in Budget Bandit and when to use each one.

Every account has a type. The type sets two things: whether the account is
included in your budget by default, and how it is treated in reports such as net
worth and debt payoff. You can change an account's type later from
<a href="/accounts/edit-close-delete">Edit account</a>.

## The seven types

| Type            | Use it for                                 | On budget by default |
| --------------- | ------------------------------------------ | -------------------- |
| **Checking**    | Your everyday spending account             | Yes                  |
| **Savings**     | Money set aside for goals                  | Yes                  |
| **Credit Card** | A card you carry and pay off               | Yes                  |
| **Cash**        | Physical cash on hand                      | Yes                  |
| **Loan**        | Mortgage, auto, student, or personal loans | No (tracking)        |
| **Investment**  | Brokerage, 401k, IRA accounts              | No (tracking)        |
| **Other**       | Anything else                              | Yes                  |

## On-budget vs tracking accounts

**On-budget** accounts hold the money you assign in your budget. Spending from
them draws down category balances. Checking, savings, cash, and credit cards are
on budget by default.

**Tracking** accounts hold value you are not budgeting day to day — a loan
balance or an investment account. They count toward your
<a href="/reports/net-worth">net worth</a> but do not pull from your category
balances. Loans and investments default to tracking.

You control this per account with the **Include in budget** checkbox, regardless
of type.

## Credit cards are special

A credit card is on budget and uses the funded-portion model. When you assign
money to a spending category and then spend on the card, that money moves to the
card's **Payment** category so it is safe to pay. Read
<a href="/concepts/how-credit-cards-work">How credit cards work</a> before you
set one up.

<Note>
  For credit cards and loans, a balance you owe is stored as a **negative**
  number. When you create the account, enter what you owe as a positive figure —
  Budget Bandit flips the sign for you.
</Note>

## Picking the right type

* Money you spend from directly, day to day: **Checking** or **Cash**.
* Money parked for later: **Savings**.
* A card you swipe and repay: **Credit Card**.
* A debt with a fixed balance you pay down: **Loan**.
* Holdings whose value you want in net worth but not your budget: **Investment**.
* None of the above: **Other**.

## Related

<CardGroup cols={2}>
  <Card title="Add a manual account" icon="pen" href="/accounts/manual-accounts">
    Create an account by hand with a starting balance.
  </Card>

  <Card title="How credit cards work" icon="credit-card" href="/concepts/how-credit-cards-work">
    The funded-portion model in plain terms.
  </Card>

  <Card title="Net worth report" icon="chart-line" href="/reports/net-worth">
    How assets and liabilities are totaled.
  </Card>

  <Card title="Edit or close an account" icon="pen-to-square" href="/accounts/edit-close-delete">
    Change a type, close, or delete.
  </Card>
</CardGroup>