I fund lots of transactions using Paypal. How should that outflow be categorized?

debsterc

It seems like the default category is "personal income." Is that because it assumes that the funding of that transaction comes from personal income?

jacobs

Quicken automatically categorizes certain Payees based on the way it thinks most users use that Payee. So I'd just disregard that for the moment; you can manually change it, or set up QuickFill Rule(s) to use your preferred category(ies). It apparently thinks many people sell things on PayPal, so it's choosing personal income as a default category.

When you say you fund transactions using PayPal, do you mean you make purchases using your PayPal account, instead of a credit card? If that's the case, I'd suggest setting up PayPal as its own account in Quicken, and defining it as a credit card account (or alternatively as a checking account). Then, each of your purchase transactions would be recorded in the PayPal account on the date you make them, with the apprpriate category for each purchase. Whenever you transfer money into your PayPal account in rela life, make a similar transfer transaction to transfer funds from your checking account to your PayPal account. In this way, you'll categorize your purchases individually, and your PayPal account in Quicken will reflect the current balance in your real-world PayPal account.

If this doesn't descfibe your actual workflow, please provide more details about what transactions you do with your PayPal account, so we can offer suggestions how to best capture things in Quicken.

debsterc

Thanks. I use Paypal to send money to my son (those end up coming from my checking) and also use it to purchase goods and services. Typically, those transactions are funded from one of several credit cards linked to my Paypal. I rarely have a Paypal balance. So my Paypal account "is" both a credit card and a checking account, depending on the type of transaction.

jacobs

If you just use PayPal as a pass-through from your credit card(s) to your purchase, I'd probably leave PayPal out of the picture in Quicken, and just record the charge in the credit card account. If you move money into your PayPal account and then make purchases charged to the PayPal account, then you could record it the same way in Quicken: transfer the cash from checking/credit card source account into PayPal (the transfer just shifts funds around, but isn't an expense), then record the purchase/expense when paid from PayPal