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QWin 2017: How to handle 'redemptions from core' in Fidelity checking account?

Bert Onstott

Hi. I wonder if anyone has run into this issue. I transferred some money market shares from one Fidelity account to our Fidelity checking account. They are not the same shares that the checking account uses for it's 'core account'.

Now, when those shares are sold, a transaction described as 'redemption from core account' shows up in the Fidelity checkbook register with a dollar amount. Those transactions do not download to Quicken. As you are aware, you can't sell shares in a checking account.

Does anyone have any idea how to handle this?

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unknown

Hi Bert,

I'm sorry for any confusion or inconvenience this has caused. To help us provide the most appropriate response, please let us know which Quicken product (QWin or QMac) and what version (2016, 2017, etc.) you are using. Also, are you using the US version of Quicken or Quicken Canada?

Thanks,
Dave

unknown

No clue as to what version of Quicken you're using.

Year and Quicken version? Release? Operating system? Mac or Windows? US or Canada?

NotACPA

Are you, perhaps, carrying the shares of a Money Market Fund as a security (i.e., "shares") rather than simply carrying them as Cash?

Do you have a "Linked Checking Account" associated with this brokerage account? If so, that fictitious "checking account" can hold only cash ... as you've noted, you can't hold a security in a checking account.

And, elaborate upon what Fidelity accounts (what type of accounts) are involved in this. Because it looks like your 2nd sentence can't possibly be precise. What you did was to transfer cash from one Fidelity account to another.

Bert Onstott

Are you, perhaps, carrying the shares of a Money Market Fund as a security (i.e., "shares") rather than simply carrying them as Cash?

Do you have a "Linked Checking Account" associated with this brokerage account? If so, that fictitious "checking account" can hold only cash ... as you've noted, you can't hold a security in a checking account.

And, elaborate upon what Fidelity accounts (what type of accounts) are involved in this. Because it looks like your 2nd sentence can't possibly be precise. What you did was to transfer cash from one Fidelity account to another.

Sorry, Quicken 2017 Deluxe for Windows, US version, Windows 10, Dell XPS 15. Been using Quicken for a long time; 20+ years.

In Fidelity, the "cash" in the checking account is held in shares of a money market fund. In Quicken, i don't keep shares in the checking account - it all looks like cash. I think that's how it is supposed to work.

In Quicken I have an "Income management account" with the box for "show cash in a separate account" checked. And there is a separate "Linked checking account". The linked checking account has the account number of the Fidelity checking account. The Income Management Account has no account number and no corresponding Fidelity account.

When I transferred the shares from another investment account into the linked checking account, they weren't sold, they were just transferred to the checking account. Now when I look at holdings for the checking account (on the Fidelity website) I see shares of two different money market funds; the one used to hold the checking account funds (core account), and the one that was transferred.

I've seen some other things that don't seem to work right. These all used to work fine until I upgraded to QW2017.

Now whenever I do a "One Step Update", the linked checking account always thinks it has transactions to review when I've already reviewed and accepted them. If I go to file operations and validate the file it will make the problem go away until I download transactions again, then it reappears.

The other change I noticed is that it used to be that dividends from the money market fund would show up as transactions to be approved in the income management account. Now they don't. Before, once they were approved the dividends would be entered into the checking account register and the reconciliation window for the checking account would come up. Now that doesn't happen.

I don't know if this is due to something I've done or due to changes made to Quicken.

Any ideas?

unknown

Are you, perhaps, carrying the shares of a Money Market Fund as a security (i.e., "shares") rather than simply carrying them as Cash?

Do you have a "Linked Checking Account" associated with this brokerage account? If so, that fictitious "checking account" can hold only cash ... as you've noted, you can't hold a security in a checking account.

And, elaborate upon what Fidelity accounts (what type of accounts) are involved in this. Because it looks like your 2nd sentence can't possibly be precise. What you did was to transfer cash from one Fidelity account to another.

Nope...wrong.

You sell the shares of the money market security, creating a cash balance. You have to remember, that the money market is a fund just like any other fund you hold...shares of a specific security.

Then you transfer the cash from that account to the appropriate checking account.

Done.

NotACPA

Are you, perhaps, carrying the shares of a Money Market Fund as a security (i.e., "shares") rather than simply carrying them as Cash?

Do you have a "Linked Checking Account" associated with this brokerage account? If so, that fictitious "checking account" can hold only cash ... as you've noted, you can't hold a security in a checking account.

And, elaborate upon what Fidelity accounts (what type of accounts) are involved in this. Because it looks like your 2nd sentence can't possibly be precise. What you did was to transfer cash from one Fidelity account to another.

Holding a MMF as a security just complicates things ... including the need to input buy, sell and ReinvDiv transactions.

Just keep it as cash. There's really no downside.

Also, on rare occasions, Q has received wildly inaccurate quotes for a MMF ... throwing your account balance into disarray. But there's no quotes for Cash, and thus no problem.

Also, your "income management account" is pure fiction ... and Q should ALWAYS mirror reality. There's nothing that you can do in this fictitious account that you couldn't do in a true reflection of your holdings at Fidelity.

unknown

Are you, perhaps, carrying the shares of a Money Market Fund as a security (i.e., "shares") rather than simply carrying them as Cash?

Do you have a "Linked Checking Account" associated with this brokerage account? If so, that fictitious "checking account" can hold only cash ... as you've noted, you can't hold a security in a checking account.

And, elaborate upon what Fidelity accounts (what type of accounts) are involved in this. Because it looks like your 2nd sentence can't possibly be precise. What you did was to transfer cash from one Fidelity account to another.

Well, I disagree. I don't like handling my money market as cash, because...well, it's not cash, it's a security. And in order to track my investment performance overall, I have to include the money market security as well. Even though we're getting a pittance in dividends. I wouldn't include cash in my security performance reports...correct?

And I get around the incorrect pricing factor by making sure I have the last price update set to $1 and then disconnect that security from downloading prices. Problem solved there.

Either way works...but for me, my way works.

unknown

Are you, perhaps, carrying the shares of a Money Market Fund as a security (i.e., "shares") rather than simply carrying them as Cash?

Do you have a "Linked Checking Account" associated with this brokerage account? If so, that fictitious "checking account" can hold only cash ... as you've noted, you can't hold a security in a checking account.

And, elaborate upon what Fidelity accounts (what type of accounts) are involved in this. Because it looks like your 2nd sentence can't possibly be precise. What you did was to transfer cash from one Fidelity account to another.

Frankly I don't think there is a generic "right answer" to this kind of question, and the best answer tends to be based on what the financial institution does as far as what transactions it sends for the transactions.

For instance I do this differently in Fidelity than I do in Vanguard.
Why?
In Fidelity "cash" dividends are handled by sending just a Div transaction for "Fidelity Cash Reserves", which means that it increases the cash balance. And if I sell something there it increases the cash balance, but there is no transaction to buy "Fidelity Cash Reserves".

So like NotACPA said I just leave it as cash in the account. And note that this is in an IRA account so there isn't an option for a linked cash account, but that isn't really important. It doesn't really matter if the cash is held in the investment account or a linked cash account. Linked cash accounts are more about when you might have check writing ability and such.

Now in Vanguard "cash" goes into "Vanguard Federal Money Market Fund", and they send a Div (so it goes to Quicken's cash balance just like in Fidelity), but they follow that with a Buy for "Vanguard Federal Money Fund". So that gets it back out of the cash balance and back into the fund.

So In Vanguard if I was to insist on it being in Quicken's cash balance, then I would have to delete transactions for this all the time.

BTW on the problem with the quotes sometimes being wrong for mutual fund accounts. What I do is just turn off fetching of the quotes. The truth is that it almost always has the correct value, but I really turn it off more for the fact that there is no reason to take up the space for quotes that are always going to be $1.

NotACPA

Are you, perhaps, carrying the shares of a Money Market Fund as a security (i.e., "shares") rather than simply carrying them as Cash?

Do you have a "Linked Checking Account" associated with this brokerage account? If so, that fictitious "checking account" can hold only cash ... as you've noted, you can't hold a security in a checking account.

And, elaborate upon what Fidelity accounts (what type of accounts) are involved in this. Because it looks like your 2nd sentence can't possibly be precise. What you did was to transfer cash from one Fidelity account to another.

Thanks for the perspective on how 2 fund companies handle things differently.

Almost all of my holdings are a Fidelity (my wife has 2 403b accounts - current and former employers, and neither of them holds cash) but everything else is with Fido ... thus directing my perception.

unknown

Are you, perhaps, carrying the shares of a Money Market Fund as a security (i.e., "shares") rather than simply carrying them as Cash?

Do you have a "Linked Checking Account" associated with this brokerage account? If so, that fictitious "checking account" can hold only cash ... as you've noted, you can't hold a security in a checking account.

And, elaborate upon what Fidelity accounts (what type of accounts) are involved in this. Because it looks like your 2nd sentence can't possibly be precise. What you did was to transfer cash from one Fidelity account to another.

And, thus, I use Vanguard which holds my money market fund.

And downloading from there makes more sense to hold the money market as a security.

Bert Onstott

Are you, perhaps, carrying the shares of a Money Market Fund as a security (i.e., "shares") rather than simply carrying them as Cash?

Do you have a "Linked Checking Account" associated with this brokerage account? If so, that fictitious "checking account" can hold only cash ... as you've noted, you can't hold a security in a checking account.

And, elaborate upon what Fidelity accounts (what type of accounts) are involved in this. Because it looks like your 2nd sentence can't possibly be precise. What you did was to transfer cash from one Fidelity account to another.

I guess the closest thing to a right answer is to sell all of the second MMF, then adjust the balance in the checking account to make it right.

There is no choice as to whether to carry the checking account balance as cash, when in reality Fidelity buys MMF shares with it. Quicken doesn't do buys and sells in a checking account.

I'd like to know why the reconcile doesn't work like it used to though. I guess I should put that in as a separate topic.