Transfer Payments for Credit Card Payments

Paddy

When a payment shows up from the download of my checking account that goes toward a credit card, I am put applying it to the credit card account that it does to using a transfer payment. In my checking account register I apply [Synchrony Bank Credit Card] and it shows up in my Synchrony Bank register as [Bank Account XXXX].

The issue is that it doesn't show up in my spending report for month as I am paying the credit card bill. It doesn't show up in spending that month in the credit card because it's a 12 month same as cash arrangement. Why is this happening?

Paddy

When a payment shows up from the download of my checking account that goes toward a credit card, I am put applying it to the credit card account that it does to using a transfer payment. In my checking account register I apply [Synchrony Bank Credit Card] and it shows up in my Synchrony Bank register as [Bank Account XXXX].

The issue is that it doesn't show up in my spending report for month as I am paying the credit card bill. It doesn't show up in spending that month in the credit card because it's a 12 month same as cash arrangement. Why is this happening?

Boatnmaniac

The reason why it doesn't show up in Spending report is that transfers from one account to another are not really spending.  They just move the asset between accounts.  The actual spending occurs when we make the credit card charges.

Those payment transfers are, however, cash flow transactions and as such they can sure feel like spending.

If you wish to include transfers in your reports you can generally do so by customizing them: 

1. Open the report and click on the Gear icon at the top right corner. 
2. Click on the Advanced tab.
3. Check to make sure Transaction Types = All Transactions.
   
4. In the drop-down to the right of Transfers select the type of transfers to be included in the report:  Include All, Exclude All, Exclude Self-Transfers or Exclude Internal.

The customized report will then group Transfer transactions below Income and Expense grouped transactions.

Paddy

How would you suggest handling this situation where I am receiving the transaction for payment in my checking account but it needs to show up in the credit card account?

Boatnmaniac

I think you are doing it correctly.  That is how I and most, if not all, of the other super users also manage it.

I was simply trying to point out that payments to credit cards are not really expenses.  The actual expenses were incurred when we bought something with the credit card.  The credit card is simply a tool that allows us to delay when we actually pay for it.

So credit card payments are simply transfers of cash from one account to another.  Expenses will reduce net worth but Transfers between accounts have no impact on net worth.  In real life when we pay a credit card bill our net worth does not change at all.  Because of this, Quicken does not classify transfers as expenses or income....they are shown in reports as transfers.

There are some people who really want to show credit card payments as expenses.  In that case they can use the Credit Card Payment expense subcategory under the Bills category.  They would use that same category in the credit card account and in the checking account.  The transactions will then offset each other in reports so after the credit card payment has cleared the bank and the credit card the net dollars of that category will always be $0. 

So no matter which way you do it there will never be an actual net expense amount shown in Quicken reports for credit card payments.  But if you use transfers you will at least see the cash flow which can be helpful in budgetary planning.