Investment Cash Balance Issues

OPPenguin

I have part of my direct deposit configured to go directly into an investment account. This seems to be confusing Quicken. Every line item has + under "Inv. Amt" and the same as - under "Cash Amt", causing the issue.

How can I make it stop doing this?

Tom Young

Well then it's clear that the actual deposit of cash into the Account isn't being accounted for, that's what's missing here and that's why you are getting a larger and larger negative cash position. 

A Bought action results in an accounting entry of:

Debit (increase) Cost of [Security Name] in Investment Account   $750
Credit (decrease) Cash in Investment Account                                   $750

and that's exactly what your image shows.

What's missing is the deposit of cash that occurs prior to or coincident with the Buy:

Debit (increase) Cash in Investment Account                               $750
Credit (decrease) Cash in Checking Account                                $750

What financial institution is associated with this Investment Account?

If you know how to look at the OFX log sent to Quicken by the financial institution then I'd suggest doing that and seeing if the the transfer/deposit is there, maybe mis-coded in some fashion.  Or, call the financial institution and ask to talk to their "Quicken" guru to see what's going on.

This doesn't seem to be a "Quicken" problem since Quicken can only process information that's sent to it by the various financial institutions

Tom Young

I think you're referring to a transaction similar to the highlighted transaction below where money has been transferred into an Investment Account from a Checking Account?

If that's correct then don't worry about it; the resulting cash balance is correct.

OPPenguin

> @"Tom Young" said:
> I think you're referring to a transaction similar to the highlighted transaction below where money has been transferred into an Investment Account from a Checking Account?
>
> If that's correct then don't worry about it; the resulting cash balance is correct.

No, that's not it at all. I have my employer's direct deposit configured to dump some money into my investment account with every paycheck. Quicken sees the purchase, but doesn't see where the money comes from and the account balance becomes negative. The net value of the account remains unchanged. If I manually add cash equal to the negative cash balance, the total value shown in Quicken exactly matches the account value shown on the investment account's web portal.

Tom Young

We're going to need some additional information here.

" I have my employer's direct deposit configured to dump some money into my investment account with every paycheck."

By that I take it that your employer is making two deposits into your accounts with each paycheck: one deposit for the net paycheck after all deductions (including the deduction for the amount going to the investment account) and the second deposit for the amount withheld from the paycheck that's going in to the investment account.

Yes? No?

Now, how are you accounting for this activity in Quicken?  By that I'm asking if you are making manual entries into Quicken for the two deposits, or are you relying on "downloads" - one from the bank for the "net check" deposit and then another from the financial institution holding the investment account for that deposit?

The "most correct/most comprehensive" accounting for this would be fir either you or Quicken's paycheck "wizard" to make an entry into the bank Account that starts with the gross pay and backs out the various deductions - insurance , taxes, the investment account deduction - resulting in the net deposit.  The deduction for the money going to the investment Account would be part of the net paycheck split entry, recorded as a transfer to the investment Account.  That way the money would "automatically" show up in the investment Account, properly documented that it comes out of the checking Account.

"Quicken sees the purchase, but doesn't see where the money comes from and the account balance becomes negative."

You've thrown a curve ball here.  You didn't mention any "purchase" in your original post.  Depositing money into an investment Account isn't any kind of purchase, it's a simple deposit.  The fact that you say Quicken "doesn't seem where the money comes from" suggests to me that you're relying on downloads to make entries into Quicken and the financial institution is sending some sort of "Deposit" transaction with the "Category" field blank, and you're allowing that entry into the transaction list without correcting it. 

But the real puzzler here is the "Quicken sees the purchase... and the account balance becomes negative."

How can a simple deposit cause an Account to go negative, and what's "going negative"? It appears to be the "cash" aspect of the Account that's negative, presumably because the deposit itself is never entered?

Why don't you explain in more detail here what's going on, including how transactions are entered into Quicken, what the "purchase" refers to and if there are placeholders in the Account, which might be the case.

OPPenguin

> @Tom Young said:
> Why don't you explain in more detail here what's going on, including how transactions are entered into Quicken, what the "purchase" refers to and if there are placeholders in the Account, which might be the case.

I'm not too confident in my vocabulary here, so bear with me.

I've got my direct deposit configured to put $750/check into a mutual fund with my brokerage. The remainder of my paycheck then goes into a checking account.

Quicken is downloading all of this information directly from the institutions in question.

For every one of the direct deposits into my mutual fund, Quicken is adding $750 to the fund shares and subtracting $750 from the cash balance, resulting in a negative cash balance. If I manually correct the negative cash balance, the total value of the fund Quicken sees is correct. See attached image, hopefully that helps get the point across. The Xln at the bottom was my attempt to manually correct the cash balance.

Tom Young

Well then it's clear that the actual deposit of cash into the Account isn't being accounted for, that's what's missing here and that's why you are getting a larger and larger negative cash position. 

A Bought action results in an accounting entry of:

Debit (increase) Cost of [Security Name] in Investment Account   $750
Credit (decrease) Cash in Investment Account                                   $750

and that's exactly what your image shows.

What's missing is the deposit of cash that occurs prior to or coincident with the Buy:

Debit (increase) Cash in Investment Account                               $750
Credit (decrease) Cash in Checking Account                                $750

What financial institution is associated with this Investment Account?

If you know how to look at the OFX log sent to Quicken by the financial institution then I'd suggest doing that and seeing if the the transfer/deposit is there, maybe mis-coded in some fashion.  Or, call the financial institution and ask to talk to their "Quicken" guru to see what's going on.

This doesn't seem to be a "Quicken" problem since Quicken can only process information that's sent to it by the various financial institutions

OPPenguin

> @Tom Young said:
> If you know how to look at the OFX log sent to Quicken by the financial institution then I'd suggest doing that and seeing if the the transfer/deposit is there, maybe mis-coded in some fashion.  Or, call the financial institution and ask to talk to their "Quicken" guru to see what's going on.

I had to look it up, but checking the OFX log shows that the deposit is not included in the information I'm getting from the financial institution, so I think you're right that it's not a Quicken problem. I'll drop them a line and see if anyone on their end can help out.

Thank you for your assistance!