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Split transactions when paying credit card bills

rmdenmark

Long-time Quicken user - just starting to use split payments to track different items on a credit card bill. It's clear how to do this when I'm paying the entire bill, but how should you account for charges that you're not actually paying at the time. If you enter all of the charges on the bill, the total will be larger than the payment. I'm sure there's a straight-forward answer, but I don't know what it is. Thanks in advance.

r.

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Bob_L

Not following you. Do you have a separate quicken credit card account that payments to are categorized as transfers? If not then I suggest you consider setting one up.

rmdenmark

No, sorry for being unclear. When making a partial payment on a credit card bill, how do you categorize the transactions which will add up to an amount greater than the payment. If the bill is for $100 and you've paid $50, itemizing/splitting the full $100 of transactions will total to more than the transaction payment if for. Hope that's clearer. r.

Bob_L

Your problem is why you should be using a credit card account instead. I do not do that, but will take a stab at it.

To do it without a cc account. I suppose you would need a liability account to which you would charge( i.e. transfer) the difference between the payment and monthly transactions plus interest. That liability balance would grow or decline depending on whether payments were less than or more than transactions.

Please consider setting up a credit card account and downloading transactions to it instead.

Sherlock

If you don't want to use a credit card account register, you may use category to track the underpayment (the amount you owe).

rmdenmark

Thank you Sherlock and Bob_L - I see what you're saying. r.

volvogirl

There is a MUCH better way to do it. You should not be splitting out the payment.

Just in case you are entering your credit card bills the wrong way…..

The proper way is to set up a credit card ACCOUNT and enter the charges into it when the purchase is made and assigning it to a category. Then when you pay the credit card bill you TRANSFER the payment from your checking account to the credit card account (not a category). Then if or when you download the payment from the bank you match it to the one you already entered.

When you enter the payment in your checking account you put the credit card account name in for the category using square brackets around the name to indicate it is a transfer...like this… [credit card] or newer Mac versions have a separate Transfer column.

I used to do it the wrong way for years! Then I wised up and now enter them properly. I would split my credit card payment into all the categories on one transaction in my checking account. And since I always pay more than the bill I would need to figure the difference and put it to another category. But then I needed to have them entered on the date the charges actually happened. Especially for taxes. So I finally set up a credit card account. It makes it much easier to enter and balance!

And if you split your credit card payment into the categories and some of the categories are Transfers to the same Account it will lump all them together and make 1 transaction in the Transfer Account.

Here's a list of some other reasons why you should do it this way…..

You don't have to wait to make the payment and split it out

You won't run out of split lines (In older versions there's only 30 lines)

You can use both the payee and memo fields for more description

You don't have to figure out the difference if you pay a different amount

Then your Credit Card Account will exactly match your statement

Charges get entered with the right date (better at year end for taxes)

You can enter all charges to date, not just what's on the bill - then you can see what you still owe

You won't forget what a charge was for if you enter it right away from the receipt

rmdenmark

Thank you volvogirl - I appreciate the completeness of your response. The reason this is fraught for me is that I don't track the credit card transactions in Quicken - my quicken entries relate to a payment order that I send to my bank when I pay the bill. Since I usually pay the whole amount, I can just split the payment into the various transactions. This particular time I didn't pay the whole bill and wasn't sure how to handle the accounting for the transactions. This doesn't happen often enough to set up a credit card account and track transactions that way, but it doesn't seem like there's a way to do what I wanted to do. I'll probably enter transactions up to the amount of the payment and then enter the remainder into a miscellaneous account. Thanks again. r.

volvogirl

Are you considering setting up a Credit Card Account? Like I said I never had but then I was glad I finally added the credit card account. There are lots of reasons why it should be separate. It really makes it better. First of the year might be a good time to start it.