Downloading from Financial Institution -Balance overstated by cash amount

fun1000000

I have been manually entering my portfolio transactions (just download quotes) for decades, and it has been matching my account statements to a tee. I finally may want to bite the bullet and start downloading from my Financial Institution.
I created a new file and downloaded from my FI and everything worked great. except the only problem is it overstates my balance by the amount of cash. The reason being, it shows the cash amount in both the money market fund, and as cash.
Now if I delete the money market account would everything work out right when I continue to download transactions in the future ? Any other suggestions ?

Update : Instead of deleting the money market acct. I just did a" transfer cash out of account", and that corrected the overstatement.
Will that be the best way of correcting the problem ? Will everything be correct in future downloads ?

q_lurker

Are you intending to update your historical file to now download transactions from the FI (financial institution)?  (Your new file is a test to see how things work?)  If so, how you managed the money market and cash in that manual account may be a consideration. 

So in that manual account, did you buy and sell a MM security as trades occurred or dividends were received keeping the cash at or near zero (on a daily or monthly basis)?  Or perhaps you left the MM assets as cash in the account.  Either method can work.  I suggest you would want the downloaded transactions to reflect a similar approach which might involve you adding to or deleting some of the downloaded transactions.  

markus1957

MMFs are handled differently by investment houses.  Some treat them as cash, some as a holding and some kind of ignore them or half report them for purposes of reporting in Quicken downloads.

First step is to determine which of the categories you fit.  If in Tools Online Center, you see the MMF reported as a Holding, then treat it as any other mutual fund.

If not you kind of need to watch and adapt to how MMF transactions are handled and how the Cash balance is reported.  MMFs just aren't standardized like other holdings so you have to be flexible in Quicken.

Adding- Vanguard reports its MMFs like any other mutual fund so it's easy.  

fun1000000

“First step is to determine which of the categories you fit. If in Tools Online Center, you see the MMF reported as a Holding, then treat it as any other mutual fund.”

The MMF is reported as Cash

Chris_QPW

It sounds like you were tracking the MMF in a security, and now you have to change over to tracking it as cash since that is how the financial institution is doing it and you will want to continue that so that the future downloads are correct.

I don't think the approach you took is correct.  If I understand correctly you now still have the "cash amount" in that security, and have removed the cash balance from the account (not to mention if it is a transfer to another account you have affected the balance of that account).

Instead you want the cash balance to stay and the security amount go to zero.
So think what is needed is a remove shares of all the shares of that security, and remove the transfer that you put in.

q_lurker

Are you intending to update your historical file to now download transactions from the FI (financial institution)?  (Your new file is a test to see how things work?)  If so, how you managed the money market and cash in that manual account may be a consideration. 

So in that manual account, did you buy and sell a MM security as trades occurred or dividends were received keeping the cash at or near zero (on a daily or monthly basis)?  Or perhaps you left the MM assets as cash in the account.  Either method can work.  I suggest you would want the downloaded transactions to reflect a similar approach which might involve you adding to or deleting some of the downloaded transactions.  

fun1000000

q_lurker said:

Are you intending to update your historical file to now download transactions from the FI (financial institution)?  (Your new file is a test to see how things work?

Exactly. In the manual account I don't include the MM as a security. I created a Bank account that shows up in the account bar as shown in the image below:
 Dividends received are transferred into income cash, and as trades occur it goes into cash and then I do a transfer cash into or out of account to principal cash.. This way I can see at a glance in the account bar how much income cash or principal cash I have. The only problem is, since the MM isn't included as a security the Total Market Value is understated and some figures are off like ROI% and Gain %. But the Net Worth/Ending Balance in the account bar is always correct. 
Now back to what I downloaded from the FI.  Since the info. downloaded is not correct and I would have to always make adjustments after always downloading, I decided just to keep doing it the old fashion way...Manually..If it ain't broke don't fix it.....LOL.

Thanks for the reply

,

Jim_Harman

From your screen shot, it appears that you have set up your accounts differently than Quicken expects to see them. 

I recognize that this may be different from standard accounting terminology, but Quicken expects accounts to correspond to actual bank or investment accounts, not to asset classes like Equity and Fixed Income. 

This will cause all sorts of issues if you try to download transactions.

You might want to try the "Show cash in a checking account" option for your investment account(s), which is closer to the way you have set things up.

fun1000000

Jim,  I understand what you are saying.  That’s why I decided to keep doing it manually, and not download transactions. I’ve been doing it this way for over 20 years, and no problems so far.

But if I ever decide to take you advise, how do I set it up to “Show cash in a checking account” ?


I just looked at quicken help.  All I have to do is “add a linked checking account” ?
Do I still exclude the MM as a security, or include it in the portfolio ?

fun1000000

I just looked at quicken help.  All I have to do is “add a linked checking account” ?

q_lurker

I agree with @Jim_Harman that your manual process is not inline with the programming.  The Quicken users mantra has generally been - "Quicken accounts should match real world accounts", though exceptions do apply.  I make the distinction between equities and fixed income securities at the security level with Security Type (equity = "Stock"; fixed income = "Bond", though you can rename those if you choose; I also use several more types to be more granular - Int'l vs US, for example.)  Using Security Types, the user can then customize or group reports and views to make the proper presentation.   

Differentiating Income cash from Principal cash also does not fit the Quicken model as apparently you have found, even manually.  I know of financial institutions that make that distinction, but personally I have never understood it or found it useful (to me).  When you have accumulated $100 of dividends (Income cash) and buy a stock with it, does it become Principal Cash?  When you sell that stock later, some goes back to Principal Cash and the Gain/Loss goes to Income Cash?  (Not real questions  unless you choose to expound.)

I think if I were trying to distinguish Income Cash vs Principle Cash using Quicken as 'intended', I would use two different (fake) MM securities.  Take in the Dividend => Buy Income Cash MM.  Sell a security => use gross proceeds to buy some Principle Cash MM, some Income Cash MM.  (assuming my above thoughts are in line.) 

Just some thoughts.  Like you said, "If it ain't broke don't fix it."

Jim_Harman

To set up a linked checking account, select one of the investing accounts and click on the gear at the top right. Select Edit account details and Show cash in a checking account is one of the options. 

This will create a special linked cash account that holds the investing account's un-invested cash. This setting is designed for accounts like Merrill Lynch CMA accounts, where users often use the cash in their investing accounts for daily expenses. It also works reasonably well for Trust accounts, which are required to keep separate accounts for principal and income. 

Be sure to back up your data file first so you can revert in case the result is not to your liking.

Jim_Harman

How you handle the Money Market account is up to you. You might want to use a mixed approach, where you hold your "Principal cash" in the money market fund, which will be part of the investing account or even a separate investing account, and your "Income cash" in the linked checking account.

At least then you will have a fighting chance of being able to deal with transaction downloads. 

fun1000000

Got it.....Who said you can’t teach an old dog new tricks ? 

Thanks q-lurker and Jim.

  I must say you all do a great job helping out in here.
You got my likes