Posting transactions as transfers vs withdrawals/deposits

I tried asking Quicken tech support this question years ago, but they didn't seem to understand the issue. After getting some good advice, quickly, on this forum, I thought I'd solicit some opinions. Here goes:

When I started using Quicken (more than 10 years ago) I entered payments from my checking acct to my credit cards as transfers (i.e. entering the credit card acct into the category field). However, in Quicken, both sides of the transaction post on the same day. Obviously, that's not how it happens in the real world. So I categorize the two sides of the transactions as Credit Card Payments (a withdrawal in my checking acct and payment in the credit card acct).

When I transfer funds from one bank to another I had/have the same issue. I used to enter them as transfers (entering the receiving acct into the category field), but the funds land in the receiving account a day or three after they leave the sending account. I handle those transactions by categorizing both sides of the transaction as "Transfer."

Is there any way to enter transfers with different dates for the credit and debit side? Is there a better way-- or alternate way-- to enter these transactions? Or did I already figure out the best way?

Answers

  • Valderi
    Valderi Member ✭✭✭✭
    For your bank account and credit cards, I think you figure out the best way.
    You can edit a transfer transaction with a different date only for a transfer between a bank account and an investment account.
  • Chris_QPW
    Chris_QPW Member ✭✭✭✭
    I have seen three approaches.
    1. Use a linked transfer and just ignore the fact that one of them is going to be the "wrong date".  Note even though this "looks wrong" it will reconcile just fine, because in the second account even though there will be a transaction there, it won't be cleared, and what's more there the downloaded posting date will be correct in both accounts.  It is the downloaded posting date that the reconcile uses.  The only thing that would be slightly wrong is that the transaction shows up in the second account and changes the balance before it happens in the real world. But I look at that like an outstanding check.  The financial institution might not see it yet, but is definitely coming and I should have enough funds in the account to cover it.
    2. Use another account to transfer in and out of.
    3. Use a real category like you do.
    This is all personal preference any of the above work.

    Personally I use #1, and in some ways I feel that it is the most accurate of what is going on.

    I typically have a reminder that is set to be put in the register a day before it is due.  So this is the "main date" that you would see on the transaction, for example 1/22/2021.  Next since I have my credit cards setup to pay automatically the first download of the transaction happens in the credit card account.  So what I will see there is the main date of 1/22/2021, and a downloaded posting date of 1/23/2021.
    Then it is typically a few days before it is posted in my checking account. So in that account I see the "main date" as 1/22/2021 and the downloaded posting date of 1/26/2021.
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  • splasher
    splasher SuperUser ✭✭✭✭
    There is no way to have different dates on the two transactions in a transfer, it is just the way Quicken is designed.
    If you want different dates, create a pass-through account (PTA).  Make the checking account transfer to the PTA on its date and then create a second transfer from the PTA to the receiving account with its date.  This method does not take any more effort on your part (you are still creating 2 transactions), but you won't have a problem with the deposits being counted as income and the debits as expenses.

    If this date difference bothers you, how do you deal with writing a paper check?  They are never posted in your financial institution's (FI) record as posted on the same date as you wrote it.  I've had paper checks not be cashed for several weeks depending on how far it was going and how quick the recipient makes it to their FI.
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  • Chris_QPW
    Chris_QPW Member ✭✭✭✭
    edited January 30
    BTW there is one time where the using of linked transfers can throw you off.  In the case for credit cards it works fine, but lets say you transfer money from one account to another and it takes days to get there.  The account that is going to get the money will have a balance higher than what you can spend for those days.

    EDIT:  I forgot how tend to handle this problem.  What I will do is enter the transaction before it clears, but set the date to what I think it will clear in the second account.  That way the balance in the second account getting the money is close to right. At least as close as I am at guessing when it will hit that account.
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  • q_lurker
    q_lurker SuperUser ✭✭✭✭✭
    I use Chris's #1 method and ignore the date consideration.  

    Method #2 is OK but extra work.  

    My objection to #3 is that net worth is altered in the interim period, like what splasher comments about paper checks.  You've reduced you asset value in the checking account but have not acknowledged the reduction in debt until some days later.  I don't consider that accurate. 
  • Sherlock
    Sherlock SuperUser ✭✭✭✭✭
    edited January 30
    We tend to use the Posting Date to determine the date a transaction was posted to a financial institution. 
  • NotACPA
    NotACPA SuperUser, Windows Beta Beta
    I'll add in that when you write a check, it doesn't clear immediately either ...  but hopefully you input it when your write it and not when it clears.
    Q user since DOS version 5
    Now running Quicken Windows Subscription, Home & Business
    Retired "Certified Information Systems Auditor" & Bank Audit VP