I've set up my budget in Quicken - My budget is allocated over 50 expense categories. (I have not budgeted against my miscellaneous category - this is important later).
Some of these categories are "monthly spend" and as such the balances do not carry over into the next month. Unspent amounts in these categories can cover overages in other categories, or can contribute to my general savings.
Most of the budget categories are a mixture of "monthly spend" and "save" - so some percentage of my monthly budget is meant to be saved for an expense that will occur later. I'm having trouble figuring out how to account for those amounts.
What I've done to date is to create an "encumbrance" category under each of these budgeted categories. At the beginning of the month, I create a net zero entry in my checking account, encumbering the "savings" amount of each budget category into the appropriate encumbrance category, and balancing the transaction with an entry against my miscellaneous category. I then transfer the total amount of the encumbrances to my high yield savings account from my checking account. Doing this shows the "spend" of my "savings amount" in the budget display, giving me an accurate measure of how much of the budgeted category is left to be spent in the month. When the actual expense occurs in the future, I transfer the money back from my savings account to my checking account; I reverse the amount out of the encumbrance category using another net-zero transaction, and record the actual spend against the budget category.
The downsides of this approach are that: I have to enter net zero transactions in my checking account; it totally destroys my miscellaneous category for expense tracking; and I have to create a custom report of only those encumbrance categories to see my savings progress against each budgeted category.
It seems to me that Savings Goals should be the way that I account for these amounts - I would create a transaction at the beginning of each month that would contribute to the Savings Goal the "savings" portion of the monthly budget. I would then transfer the total amount contributed to the savings goals into my savings account. However, I run into a number of problems trying to implement this:
1) I can't contribute to, or withdraw from a savings goal in a "split" transaction - meaning that I have to create a separate savings goal transfer for each budgeted category that has a save component. This is more than 30 transactions. And transferring to the Savings Goal does not register as spend in my budget category, so I still have to enter a net-zero transaction in my checking account to get the savings contribution to register as "spend" in the budget category.
2) Once the amount is transferred from my checking account to the Savings Goal, I can't figure out how I am to record the transfer of money to my savings account. If I transfer from the Savings Goal, the balance in the goal goes down. The balance in my checking account has already been deducted for the contribution to the Savings Goal.
My question is - what is the appropriate way to track this component of my monthly budget? Am I misunderstanding something about Savings Goals that would allow me to have contributions and withdrawals register against budget categories? And how do I sweep the money that I have in a Savings Goal to a high-yield savings account?
Please let me know if my question isn't clearly explained, and thanks in advance for any advice,
-John
