Buy vs BuyX

zeblon

What's the difference between `Buy` and `BuyX with the investment account selected as the source of the cash`? They seem conceptually the same to me, but they result in a different cash balance in my 401(K).

I'm a new Quicken user. When I set up my 401(K) account Quicken automatically downloaded the most recent 90 days via Direct Connect, and I imported the rest of my investment history via QIF. The security purchases entered via QIF came in as "Buy" (where "Use cash for this transaction" is set to "From this account's cash balance"). The ones downloaded via Direct Connect came in as BuyX (with "Use cash for this transaction" set to "From: My 401(K)").

I would have expected the two types of transactions to be equivalent; I would expect both to reduce the 401(K)'s cash balance by the purchase amount, but they don't. Instead, when I switch a BuyX to a Buy, it reduces the cash balance by the purchase amount. The cash balance is off, and I assume BuyX vs Buy is why, but I'd like to understand the real difference before I go down this route. I've run into several gotchas as I set up my data, and I don't want this to be yet another.

To give some context, I fund the account via deductions from my paycheck. I'll be entering my contributions as cash transfers into the 401(K) in the future, and I'll back-enter a few recent paychecks, but I'll have to put in some sort of adjustment for most of my historical contributions (20 years of bi-weekly contributions is way too much effort).

NotACPA

Say that you're in your 401k account or any other investment account.

A BUY transaction will use the cash that's already in that account to make the purchase.

A BUYX will use money that's in another account (say, your checking account) to make the purchase.

Using your example, your paycheck contribution increases the cash in the 401k ... and the BUY reduces the cash.

In the graphic, I'm using the cash already in the RIRA, via a self-transfer, to end up with the same  result as if I'd just selected "this accounts cash balance".  Which, while it works, doesn't make much sense.

q_lurker

To address this from your original question about Buys,

1. Using the radio button to use cash "From this account's cash balance" is a straightforward Buy transaction and the cash balance of that account will decrease accordingly.
2. Using the radio button "From" and specifying a different account will enter a cash transfer from the other account decreasing that account's cash balance.  that is a standard BuyX transaction.
3. Using the radio button "From" and specifying the same account is a special case use.  I refer to that as a recursive transaction since it is referencing the same account. In that special case, NO account gets its cash balance decreased; the cash for the buy essentially comes out of this air.  

The third case is NOT intended to be a duplicate of the first case.  

That recursive use of a transfer account is most commonly seen on Opening Balance transactions where you and Quicken are effectively saying:  "This is my starting point and I don't need to identify the source of the cash."

Without checking, I'll suggest that distinction applies to all investment __X transactions.  The relevant cash either comes from thin air or goes into thin air if the recursive reference is made to the same account that is receiving the transaction entry.   

NotACPA

Say that you're in your 401k account or any other investment account.

A BUY transaction will use the cash that's already in that account to make the purchase.

A BUYX will use money that's in another account (say, your checking account) to make the purchase.

Using your example, your paycheck contribution increases the cash in the 401k ... and the BUY reduces the cash.

In the graphic, I'm using the cash already in the RIRA, via a self-transfer, to end up with the same  result as if I'd just selected "this accounts cash balance".  Which, while it works, doesn't make much sense.

q_lurker

To address this from your original question about Buys,

1. Using the radio button to use cash "From this account's cash balance" is a straightforward Buy transaction and the cash balance of that account will decrease accordingly.
2. Using the radio button "From" and specifying a different account will enter a cash transfer from the other account decreasing that account's cash balance.  that is a standard BuyX transaction.
3. Using the radio button "From" and specifying the same account is a special case use.  I refer to that as a recursive transaction since it is referencing the same account. In that special case, NO account gets its cash balance decreased; the cash for the buy essentially comes out of this air.  

The third case is NOT intended to be a duplicate of the first case.  

That recursive use of a transfer account is most commonly seen on Opening Balance transactions where you and Quicken are effectively saying:  "This is my starting point and I don't need to identify the source of the cash."

Without checking, I'll suggest that distinction applies to all investment __X transactions.  The relevant cash either comes from thin air or goes into thin air if the recursive reference is made to the same account that is receiving the transaction entry.   

NotACPA

Correction noted.  And agreed with.

Tom Young

From a balance sheet perspective a BuyX is essentially the same as an Add.  No cash change, Account increases by the value of the security, "Overall Total" on a Account Balances or Net Worth report increases by the same amount.

MoneyCurious

When I do the Buy, the field to let me change the account of where the money comes from is disabled. I have no choice but to accept the "From this account's cash balance" as the "Use cash for this transaction" reply.
I do need (want) to use boughtx as I have done in all my previous IRA accounts...but I cannot even manually force it due to this.
Any suggestions?

MoneyCurious

In that "Use Cash For This Transaction" box, it is all disabled and set to "from this accounts cash balance". I want it to allow me to set it to another account but as I said, the buttons are disabled . Why is that? And how can I make them undisabled? Thank you