diff --git a/app/controllers/transfers_controller.rb b/app/controllers/transfers_controller.rb
index 895dcfa2..48556f09 100644
--- a/app/controllers/transfers_controller.rb
+++ b/app/controllers/transfers_controller.rb
@@ -1,4 +1,6 @@
 class TransfersController < ApplicationController
+  include StreamExtensions
+
   before_action :set_transfer, only: %i[destroy show update]
 
   def new
@@ -10,25 +12,19 @@ class TransfersController < ApplicationController
   end
 
   def create
-    from_account = Current.family.accounts.find(transfer_params[:from_account_id])
-    to_account = Current.family.accounts.find(transfer_params[:to_account_id])
-
-    @transfer = Transfer.from_accounts(
-      from_account: from_account,
-      to_account: to_account,
+    @transfer = Transfer::Creator.new(
+      family: Current.family,
+      source_account_id: transfer_params[:from_account_id],
+      destination_account_id: transfer_params[:to_account_id],
       date: transfer_params[:date],
       amount: transfer_params[:amount].to_d
-    )
-
-    if @transfer.save
-      @transfer.sync_account_later
-
-      flash[:notice] = t(".success")
+    ).create
 
+    if @transfer.persisted?
+      success_message = "Transfer created"
       respond_to do |format|
-        format.html { redirect_back_or_to transactions_path }
-        redirect_target_url = request.referer || transactions_path
-        format.turbo_stream { render turbo_stream: turbo_stream.action(:redirect, redirect_target_url) }
+        format.html { redirect_back_or_to transactions_path, notice: success_message }
+        format.turbo_stream { stream_redirect_back_or_to transactions_path, notice: success_message }
       end
     else
       render :new, status: :unprocessable_entity
diff --git a/app/models/trade/creator.rb b/app/models/trade/creator.rb
new file mode 100644
index 00000000..224f3576
--- /dev/null
+++ b/app/models/trade/creator.rb
@@ -0,0 +1,12 @@
+class Trade::Creator
+  def initialize(attrs)
+    @attrs = attrs
+  end
+
+  def create
+    # TODO
+  end
+
+  private
+    attr_reader :attrs
+end
\ No newline at end of file
diff --git a/app/models/transaction.rb b/app/models/transaction.rb
index c2e20148..0967aac1 100644
--- a/app/models/transaction.rb
+++ b/app/models/transaction.rb
@@ -10,10 +10,11 @@ class Transaction < ApplicationRecord
   accepts_nested_attributes_for :taggings, allow_destroy: true
 
   enum :kind, {
-    standard: "standard",
-    transfer: "transfer",
-    loan_payment: "loan_payment",
-    one_time: "one_time"
+    standard: "standard", # A regular transaction, included in budget analytics
+    transfer: "transfer", # Movement of funds, excluded from budget analytics
+    payment: "payment", # A CC or Other payment, excluded from budget analytics (CC payments offset the sum of expense transactions)
+    loan_payment: "loan_payment", # A payment to a Loan account, treated as an expense in budgets
+    one_time: "one_time" # A one-time expense/income, excluded from budget analytics
   }
 
   class << self
diff --git a/app/models/transfer.rb b/app/models/transfer.rb
index 20804ddd..7177a0dd 100644
--- a/app/models/transfer.rb
+++ b/app/models/transfer.rb
@@ -22,8 +22,17 @@ class Transfer < ApplicationRecord
         Money.new(amount.abs, from_account.currency)
       end
 
+      outflow_kind = if to_account&.accountable_type == "Loan"
+        "loan_payment"
+      elsif to_account&.liability?
+        "payment"
+      else
+        "transfer"
+      end
+
       new(
         inflow_transaction: Transaction.new(
+          kind: "transfer",
           entry: to_account.entries.build(
             amount: converted_amount.amount.abs * -1,
             currency: converted_amount.currency.iso_code,
@@ -32,6 +41,7 @@ class Transfer < ApplicationRecord
           )
         ),
         outflow_transaction: Transaction.new(
+          kind: outflow_kind,
           entry: from_account.entries.build(
             amount: amount.abs,
             currency: from_account.currency,
@@ -89,6 +99,24 @@ class Transfer < ApplicationRecord
     to_account&.liability?
   end
 
+  def loan_payment?
+    outflow_transaction&.kind == "loan_payment"
+  end
+
+  def liability_payment?
+    outflow_transaction&.kind == "payment"
+  end
+
+  def regular_transfer?
+    outflow_transaction&.kind == "transfer"
+  end
+
+  def transfer_type
+    return "loan_payment" if loan_payment?
+    return "liability_payment" if liability_payment?
+    "transfer"
+  end
+
   def categorizable?
     to_account&.accountable_type == "Loan"
   end
diff --git a/app/models/transfer/creator.rb b/app/models/transfer/creator.rb
new file mode 100644
index 00000000..b713bafa
--- /dev/null
+++ b/app/models/transfer/creator.rb
@@ -0,0 +1,85 @@
+class Transfer::Creator
+  def initialize(family:, source_account_id:, destination_account_id:, date:, amount:)
+    @family = family
+    @source_account = family.accounts.find(source_account_id) # early throw if not found
+    @destination_account = family.accounts.find(destination_account_id) # early throw if not found
+    @date = date
+    @amount = amount
+  end
+
+  def create
+    transfer = Transfer.new(
+      inflow_transaction: inflow_transaction,
+      outflow_transaction: outflow_transaction,
+      status: "confirmed"
+    )
+
+    if transfer.save
+      source_account.sync_later
+      destination_account.sync_later
+    end
+
+    transfer
+  end
+
+  private
+    attr_reader :family, :source_account, :destination_account, :date, :amount
+
+    def outflow_transaction
+      name = "#{name_prefix} to #{destination_account.name}"
+
+      Transaction.new(
+        kind: outflow_transaction_kind,
+        entry: source_account.entries.build(
+          amount: amount.abs,
+          currency: source_account.currency,
+          date: date,
+          name: name,
+        )
+      )
+    end
+
+    def inflow_transaction
+      name = "#{name_prefix} from #{source_account.name}"
+
+      Transaction.new(
+        kind: "transfer",
+        entry: destination_account.entries.build(
+          amount: inflow_converted_money.amount.abs * -1,
+          currency: destination_account.currency,
+          date: date,
+          name: name,
+        )
+      )
+    end
+
+    # If destination account has different currency, its transaction should show up as converted
+    # Future improvement: instead of a 1:1 conversion fallback, add a UI/UX flow for missing rates
+    def inflow_converted_money
+      Money.new(amount.abs, source_account.currency)
+           .exchange_to(
+             destination_account.currency,
+             date: date,
+             fallback_rate: 1.0
+           )
+    end
+
+    # The "expense" side of a transfer is treated different in analytics based on where it goes.
+    def outflow_transaction_kind
+      if destination_account.loan?
+        "loan_payment"
+      elsif destination_account.liability?
+        "payment"
+      else
+        "transfer"
+      end
+    end
+
+    def name_prefix
+      if destination_account.liability?
+        "Payment"
+      else
+        "Transfer"
+      end
+    end
+end
diff --git a/db/schema.rb b/db/schema.rb
index 9c10112c..f4d6b2a9 100644
--- a/db/schema.rb
+++ b/db/schema.rb
@@ -10,7 +10,7 @@
 #
 # It's strongly recommended that you check this file into your version control system.
 
-ActiveRecord::Schema[7.2].define(version: 2025_06_10_181219) do
+ActiveRecord::Schema[7.2].define(version: 2025_06_16_183654) do
   # These are extensions that must be enabled in order to support this database
   enable_extension "pgcrypto"
   enable_extension "plpgsql"
@@ -648,7 +648,9 @@ ActiveRecord::Schema[7.2].define(version: 2025_06_10_181219) do
     t.uuid "category_id"
     t.uuid "merchant_id"
     t.jsonb "locked_attributes", default: {}
+    t.string "kind", default: "standard", null: false
     t.index ["category_id"], name: "index_transactions_on_category_id"
+    t.index ["kind"], name: "index_transactions_on_kind"
     t.index ["merchant_id"], name: "index_transactions_on_merchant_id"
   end
 
diff --git a/test/fixtures/transactions.yml b/test/fixtures/transactions.yml
index 426d7d58..7420c310 100644
--- a/test/fixtures/transactions.yml
+++ b/test/fixtures/transactions.yml
@@ -2,5 +2,7 @@ one:
   category: food_and_drink
   merchant: amazon
 
-transfer_out: { }
-transfer_in: { }
\ No newline at end of file
+transfer_out:
+  kind: payment
+transfer_in:
+  kind: transfer
\ No newline at end of file
diff --git a/test/models/transfer/creator_test.rb b/test/models/transfer/creator_test.rb
new file mode 100644
index 00000000..6328a1b4
--- /dev/null
+++ b/test/models/transfer/creator_test.rb
@@ -0,0 +1,166 @@
+require "test_helper"
+
+class Transfer::CreatorTest < ActiveSupport::TestCase
+  setup do
+    @family = families(:dylan_family)
+    @source_account = accounts(:depository)
+    @destination_account = accounts(:investment)
+    @date = Date.current
+    @amount = 100
+  end
+
+  test "creates basic transfer" do
+    creator = Transfer::Creator.new(
+      family: @family,
+      source_account_id: @source_account.id,
+      destination_account_id: @destination_account.id,
+      date: @date,
+      amount: @amount
+    )
+
+    transfer = creator.create
+
+    assert transfer.persisted?
+    assert_equal "confirmed", transfer.status
+    assert transfer.regular_transfer?
+    assert_equal "transfer", transfer.transfer_type
+
+    # Verify outflow transaction (from source account)
+    outflow = transfer.outflow_transaction
+    assert_equal "transfer", outflow.kind
+    assert_equal @amount, outflow.entry.amount
+    assert_equal @source_account.currency, outflow.entry.currency
+    assert_equal "Transfer to #{@destination_account.name}", outflow.entry.name
+
+    # Verify inflow transaction (to destination account)
+    inflow = transfer.inflow_transaction
+    assert_equal "transfer", inflow.kind
+    assert_equal(@amount * -1, inflow.entry.amount)
+    assert_equal @destination_account.currency, inflow.entry.currency
+    assert_equal "Transfer from #{@source_account.name}", inflow.entry.name
+  end
+
+  test "creates multi-currency transfer" do
+    # Use crypto account which has USD currency but different from source
+    crypto_account = accounts(:crypto)
+
+    creator = Transfer::Creator.new(
+      family: @family,
+      source_account_id: @source_account.id,
+      destination_account_id: crypto_account.id,
+      date: @date,
+      amount: @amount
+    )
+
+    transfer = creator.create
+
+    assert transfer.persisted?
+    assert transfer.regular_transfer?
+    assert_equal "transfer", transfer.transfer_type
+
+    # Verify outflow transaction
+    outflow = transfer.outflow_transaction
+    assert_equal "transfer", outflow.kind
+    assert_equal "Transfer to #{crypto_account.name}", outflow.entry.name
+
+    # Verify inflow transaction with currency handling
+    inflow = transfer.inflow_transaction
+    assert_equal "transfer", inflow.kind
+    assert_equal "Transfer from #{@source_account.name}", inflow.entry.name
+    assert_equal crypto_account.currency, inflow.entry.currency
+  end
+
+  test "creates loan payment" do
+    loan_account = accounts(:loan)
+
+    creator = Transfer::Creator.new(
+      family: @family,
+      source_account_id: @source_account.id,
+      destination_account_id: loan_account.id,
+      date: @date,
+      amount: @amount
+    )
+
+    transfer = creator.create
+
+    assert transfer.persisted?
+    assert transfer.loan_payment?
+    assert_equal "loan_payment", transfer.transfer_type
+
+    # Verify outflow transaction is marked as loan payment
+    outflow = transfer.outflow_transaction
+    assert_equal "loan_payment", outflow.kind
+    assert_equal "Payment to #{loan_account.name}", outflow.entry.name
+
+    # Verify inflow transaction
+    inflow = transfer.inflow_transaction
+    assert_equal "transfer", inflow.kind
+    assert_equal "Payment from #{@source_account.name}", inflow.entry.name
+  end
+
+  test "creates credit card payment" do
+    credit_card_account = accounts(:credit_card)
+
+    creator = Transfer::Creator.new(
+      family: @family,
+      source_account_id: @source_account.id,
+      destination_account_id: credit_card_account.id,
+      date: @date,
+      amount: @amount
+    )
+
+    transfer = creator.create
+
+    assert transfer.persisted?
+    assert transfer.liability_payment?
+    assert_equal "liability_payment", transfer.transfer_type
+
+    # Verify outflow transaction is marked as payment for liability
+    outflow = transfer.outflow_transaction
+    assert_equal "payment", outflow.kind
+    assert_equal "Payment to #{credit_card_account.name}", outflow.entry.name
+
+    # Verify inflow transaction
+    inflow = transfer.inflow_transaction
+    assert_equal "transfer", inflow.kind
+    assert_equal "Payment from #{@source_account.name}", inflow.entry.name
+  end
+
+  test "raises error when source account ID is invalid" do
+    assert_raises(ActiveRecord::RecordNotFound) do
+      Transfer::Creator.new(
+        family: @family,
+        source_account_id: 99999,
+        destination_account_id: @destination_account.id,
+        date: @date,
+        amount: @amount
+      )
+    end
+  end
+
+  test "raises error when destination account ID is invalid" do
+    assert_raises(ActiveRecord::RecordNotFound) do
+      Transfer::Creator.new(
+        family: @family,
+        source_account_id: @source_account.id,
+        destination_account_id: 99999,
+        date: @date,
+        amount: @amount
+      )
+    end
+  end
+
+  test "raises error when source account belongs to different family" do
+    other_family = families(:empty)
+
+    assert_raises(ActiveRecord::RecordNotFound) do
+      Transfer::Creator.new(
+        family: other_family,
+        source_account_id: @source_account.id,
+        destination_account_id: @destination_account.id,
+        date: @date,
+        amount: @amount
+      )
+    end
+  end
+end
diff --git a/test/system/transactions_test.rb b/test/system/transactions_test.rb
index 4b3bcae8..8b292c8e 100644
--- a/test/system/transactions_test.rb
+++ b/test/system/transactions_test.rb
@@ -203,6 +203,7 @@ class TransactionsTest < ApplicationSystemTestCase
     inflow_entry = create_transaction("inflow", 1.day.ago.to_date, -500, account: investment_account)
     @user.family.auto_match_transfers!
     visit transactions_url
+
     within "#entry-group-" + Date.current.to_s + "-totals" do
       assert_text "-$100.00" # transaction eleven from setup
     end