How to track Special Financing transactions / Equal payment transactions

JoshJinATL

With the growing trend of financing companies offering No Interest financing, or equal payments for purchases I am wondering what's the best way to track that within Quicken?
For example Amazon allows you to make purchases with either Equal Payments, or Special financing: https://www.amazon.com/Financing-Offers/b?ie=UTF8&node=9541758011
(pay $25/month for $150 purchase for 6 months; $150/6 months = $25/month)

So if I buy something for $150 quicken will categorize that as 1 time Shopping expense. I am ok with that. But how can I track the $25.00 a month Expense in the budget field, so I can keep track of all of the monthly payments from a budget perspective.

Anyone have any thoughts, or ideas on how to setup the system?

NotACPA

When do you actually receive the item being bought?  Because there's 2 approaches to your issue .... depending upon that answer.

JoshJinATL

You always receive the item right away like any other purchase, you just pay for it over time. More and more companies are moving in this direction, such as Affirm and others.

NotACPA

Then, I'd probably set up a Payables, liability type account, and record the original $150 as coming from that account (much like when you make a credit card purchase).

Then, re-pay this liability account $25 a month.

You could, if you'd like, even set up a "pretend" credit card account for this purpose.

JoshJinATL

That's an interesting idea... Would you just categorize the originating transaction on the real account? As a "Transfer" to the newly created Liability Account?

NotACPA

NO, that original $150 transaction is the Expense ... just as you record the expense when you use your credit card ... not when you pay the card bill.

The $25 payments are transfers to this account, just as your card bill payment is a transfer.