How to handle brokered CDs

Perry Kincy

I buy CDs through my brokerage account.  The account is in Quicken for Windows.  Unfortunately Q will not account for the maturity of those CDs at all.  It keeps the CD entered as a security even though it has matured and been paid into the account as cash.

Ps56k2

How do you currently handle the CD as it matures, interest payments, etc -
What happens when it matures - what transactions are used for the payout.
I would think it would be just like any other holding, it's balance would go to zero, reflecting some kind of "transfer" of the proceeds into some other cash account.  The CD number would then just hang around, like any other stock symbol that was sold.

Perry Kincy

I was not entering them correctly apparently.  I read to load them as Shares bought (the CDs in a brokerage acct) at 100/share.  And then enter them as Sold shares when they mature.  Thank you.

mortyturbo

Let's review how these are entered in the Quicken dialogues:

• Enter symbol or name:
• Enter manually as my CDs are not found ever:
• Choose security type:CD
• Asset Class: Elsewhere in Quicken help, the instruction is to chose 'Cash'.
• Maturity date: self explanatory

Done

This security must then be populated with an amount.

As suggested a buy security at acquisition and sell security will work but this will likely not work with a download from your brokerage firm.  Merrill Edge treats it as a maturing CD with the value added to the account cash account.

Elsewhere in Quicken help, a maturing CD is to be treated as 'Return of Capital.'

My issue is that CDs are a common investment by many, many investors.  So, I am looking for a straight-forward approach, rather than, what seem to me to be rather flip responses, this approach (buy/sell a security) will work.  Except if you are trying to construct a report based on maturity dates or interest rates.

A CD is a loan to an entity for which it pays you interest.  When the loan/CD matures, you get the money back.  The CD should show up in Holdings and disappear when it matures.  Tell me how to do that in Quicken.  Not just the register but so that reports and the like can be generated easily.

If the CD is not held to maturity, it must be treated as a bond and not as cash.

To Kelly: this is NO right way or simply no way to enter correctly.

Rocket J Squirrel

I have always treated a matured CD or bond (or a called bond) as a Sell transaction. If your brokerage sends you a different type of transaction, simply replace that transaction with the proper Sell.

Recent versions of Quicken have the "Maturity dates for bonds and CDs" report, which provides a nice snapshot of your bond/CD ladder.

Jim_Harman

@mortyturbo, If I had a CD that matured, I would want it to no longer appear in my Holdings, but it should not simply disappear. I need a transaction in the account to convert that security into cash - a Sell. In addition to properly showing the resulting cash, the Sell is needed to account for any capital gains or losses.

If you want this to take effect automatically on the maturity date, you can enter future-dated transactions, or look into creating a Scheduled Transaction Group.

Perry Kincy

My answer to my question above was from reading the directions in Quicken and it works.   it works on entry, on interest paid and on maturity and downloads correctly from my brokerage account.  Shares bought at 100$/share.

Ps56k2

Rocket J Squirrel said:

Recent versions of Quicken have the "Maturity dates for bonds and CDs" report, which provides a nice snapshot of your bond/CD ladder.

I've just looked at that report - but I can't figure out how and where to actually setup a CD/Bond with all the appropriate info so it actually shows on this report.
If I do the "add account" - it's just the normal walk thru.... so... what are the steps -

NotACPA

@ps56k I believe that the CD needs to be set up as an investment security for this report to work.  It's not an account ... it's a security.

Jim_Harman

@ps56k, the report works for CDs entered as securities in an investing account, not for a CD-type bank account .

When you set up the security as a CD, you can enter the Maturity Date in the Security details. Find the CD in your Security List, click on Edit, make sure the Type is CD, and the place to enter the maturity date will be near the bottom.

Ps56k2

Tnx - was caught between the two worlds.... my current CDs setup and downloaded from normal banks - and the "Investment" report - which I saw, but then went back to the Banking world.   Back to ground zero, just as a test. 
- Setup a test Security to represent the CD
- Setup an Investment Account to hold the CD
- Added cash to the Investment account
- Added the transaction of buying the CD security into the account

- Displayed the Investment CD Report