Can't Change Bank Account Linked to Investment Account [edited]

Ivan Socher

Vanguard is the largest mutual fund company in the US.

More than a decade ago I opened a Quicken Investment account to track and support investments held at Vanguard. As Vanguard offered checking services, I used Vanguard for all our banking. Quicken automatically set up a checking account which Quicken automatically linked to the Vanguard investment account. For decades this has worked well.

In February (or earlier) Vanguard announced that it was discontinuing its Advantage checking and banking services effective July 31, 2019. So, we have been forced to move our banking to Wells Fargo.

After wasting hours trying to link our Quicken investment account to our new Wells Fargo banking account and then wasting more time with Quicken support I learned that:
SHOCKINGLY, QUICKEN DOES NOT ALLOW FOR LINKED BANK ACCOUNTS TO BE CHANGED!!!!!!

This makes it cumbersome and difficult to use Quicken to manage the purchase and sale of investments held on Vanguard. Quicken support's suggestion to change the Quicken Investment account from "Show cash in checking account" to No causes Quicken to reverse all transactions. As I have many thousands of historical transactions, this approach makes no sense and seems very dangerous.

Hopefully, if and when other Vanguard clients will run into this SERIOUS PROBLEM in July when Vanguard ceases its banking services, Quicken will act and provide a way to change linked bank accounts.

Jim_Harman

Since the linked checking account is no longer doing anything useful for you, one option would be to create a new, empty brokerage account without a linked checking account and  transfer your current holdings to that. Here is the basic process:

Tools > Add Account > Brokerage. 
Click on Advanced setup at the bottom. 
Select I want to enter my transactions manually. 
Name the account. 
Statement ending date is the day before you will be transferring the shares (just after the last transaction in the old account), amounts are zero
Leave "What securities" blank
Are you sure? Yes.
Done.

Go to the old account.

Gear > Edit account details
Online Services > Deactivate. This prevents any more downloads to the old account
Click on Enter Transactions
Select Shares transferred between accounts
Date = the day you want to do the transfer
All securities
Done

The screen will start flashing as it enters a Removed for each holding in the old account and an Added for each open tax lot of of each security in the new account. 

When it is done, you should have no shares in the old account but all your checking transactions will still be in the linked acount. All your current holdings should appear in the new account, with their correct cost basis. If there is a cash balance in the old account, transfer it to the new one (there should be no cash balance with a Vanguard account)

Now you can click the gear in the new account and set up online services. Note the dates of the downloaded transactions and do not accept any from before the transfer date. Do not let Quicken create any Placeholders.  

Jim_Harman

I don't know what you mean by "reverse all transactions."

Setting "Show cash in a checking account" to No removes Quicken's linked checking account and moves the existing checking account transactions into your brokerage account. No data should be lost in this process. I did this some time ago with a Vanguard accoutn with no ill effects.

You can try this with a copy of your data file to see what the result looks like. If you are OK with the result, you can go forward with that file. If not, you can go back to your original file.

Or if you want, you can keep the linked checking account, you just won't be writing checks from that account any more.

Going forward, you will be writing checks from your new Wells Fargo account, which you should be able to connect to Quicken, and using Cash Transferred (Xin and Xout) transactions to move money between Vanguard and Wells Fargo. If you choose to keep the linked checking account, the cash will go in and out of that account.

There are other possibilities if neither of these approaches appeals to you.

Ivan Socher

Jim, thanks for taking time to suggest solutions. I believe that I tried your first solution. When I selected the No to Show cash in a checking account, Quicken took ages to process decades of transactions. When it was complete, the Checking account showed a negative balance of >$100,000 when there is no longer any cash in the account. So, I reloaded the backup file and kept the linked account. Over the years I've archived Quicken files and wonder whether might explain the huge discrepancies.

Now, as you suggest, I have to transfer funds between the old linked checking account and the Wells Fargo account. I have to do this for each purchase and sale of stocks and mutual funds. Very time consuming and frustrating.

Anyway, thanks again.
Ivan

Jim_Harman

Since the linked checking account is no longer doing anything useful for you, one option would be to create a new, empty brokerage account without a linked checking account and  transfer your current holdings to that. Here is the basic process:

Tools > Add Account > Brokerage. 
Click on Advanced setup at the bottom. 
Select I want to enter my transactions manually. 
Name the account. 
Statement ending date is the day before you will be transferring the shares (just after the last transaction in the old account), amounts are zero
Leave "What securities" blank
Are you sure? Yes.
Done.

Go to the old account.

Gear > Edit account details
Online Services > Deactivate. This prevents any more downloads to the old account
Click on Enter Transactions
Select Shares transferred between accounts
Date = the day you want to do the transfer
All securities
Done

The screen will start flashing as it enters a Removed for each holding in the old account and an Added for each open tax lot of of each security in the new account. 

When it is done, you should have no shares in the old account but all your checking transactions will still be in the linked acount. All your current holdings should appear in the new account, with their correct cost basis. If there is a cash balance in the old account, transfer it to the new one (there should be no cash balance with a Vanguard account)

Now you can click the gear in the new account and set up online services. Note the dates of the downloaded transactions and do not accept any from before the transfer date. Do not let Quicken create any Placeholders.  

Jim_Harman

Also with your brokerage account there is a money market settlement fund which holds the cash for buys, sells, dividends, etc. Usually people keep some money there rather than transferring to a checking account for every investing transaction. 

At Vanguard this is the Federal Money Market fund, which is currently paying about 2% interest.