Is there a "simple" way to set up a Money Market fund?

Phil Burton

As someone else said, apologies in advance if I should already have known the answer to this question. But I don't, or I wouldn't be asking. I want a "simple" way to set up a money market fund, with just "deposits," "withdrawals," and "interest."

I just set up a money market fund within my overall brokerage account. I want to treat this MM account as kind of a "super savings account." With my bank, I can transfer cash between checking and savings. I want to be able to do the same between checking/savings, and the money market fund. From an operational point of view, that is no problem. In time, I might want to use that account to make other investments in my brokerage, or park the money from the same of other investments.

However, Quicken seems to add unnecessary complexity for transactions in and out of the MMA. It seems overly complex (or perhaps lack of "imagination" ) to force you to buy/sell a "security" when that security is the US dollar and never changes value. It doesn't have a symbol, unless you use "$". :)

So, is there an easier way to set up a MM account?

Boatnmaniac

There are two different types of "Money Markets" that I am aware of:

1. One is a Money Market Fund (MMF) which is a type of mutual fund security where there are shares that are purchased and sold and the share value is always $1. In a MMF there is no way to transfer money into and out of it. The only way to change the value of it is to buy or sell shares. MMFs are always held in investment accounts.
2. The other is a Money Market Account (MMA) which is a type of savings account. Cash can be transferred into and out of these types of accounts in any currency value that you want. No shares or buys/sells of shares are involved. MMAs typically are held in banks and credit unions, and are not investment accounts (because in most cases brokerages are not permitted to offer banking products like checking and savings accounts although that line has often become pretty blurred over the years with the advent of Cash Management Accounts).

It sounds to me like you are describing a MMA, not a MMF. It also sounds to me like you are manually managing this MMA. If I am correct, I would suggest that you set up the account as a Savings account. You can name it "MMA" if you wish or whatever else you might like to call it. Then you can do simple transfers in and out of that savings account, just like you would do at a bank between checking and savings.

And if you wish for this MMA Savings account to be grouped with other Investment accounts you can go to the Display tab of Account Details and change the Account Intent from Savings to Investment. That will then move the MMA Savings account into the same group as other Investment accounts in Account List and in the Account Bar on the left side of Quicken.

If, however, you really want to have "Money Market" value tracked in an investment account, you will either need to set up a dummy manual MMF and then buy/sell shares of it at $1/share. Or, IMO, a better option might be to simply hold it as Cash in the Investment account in which case you can then do cash transfers into and out of the account and there would be no MMF share transactions involved.

Boatnmaniac

@Phil Burton - I'm glad you found my earlier reply to be helpful. Perhaps others will, as well.

Boatnmaniac

There are two different types of "Money Markets" that I am aware of:

1. One is a Money Market Fund (MMF) which is a type of mutual fund security where there are shares that are purchased and sold and the share value is always $1. In a MMF there is no way to transfer money into and out of it. The only way to change the value of it is to buy or sell shares. MMFs are always held in investment accounts.
2. The other is a Money Market Account (MMA) which is a type of savings account. Cash can be transferred into and out of these types of accounts in any currency value that you want. No shares or buys/sells of shares are involved. MMAs typically are held in banks and credit unions, and are not investment accounts (because in most cases brokerages are not permitted to offer banking products like checking and savings accounts although that line has often become pretty blurred over the years with the advent of Cash Management Accounts).

It sounds to me like you are describing a MMA, not a MMF. It also sounds to me like you are manually managing this MMA. If I am correct, I would suggest that you set up the account as a Savings account. You can name it "MMA" if you wish or whatever else you might like to call it. Then you can do simple transfers in and out of that savings account, just like you would do at a bank between checking and savings.

And if you wish for this MMA Savings account to be grouped with other Investment accounts you can go to the Display tab of Account Details and change the Account Intent from Savings to Investment. That will then move the MMA Savings account into the same group as other Investment accounts in Account List and in the Account Bar on the left side of Quicken.

If, however, you really want to have "Money Market" value tracked in an investment account, you will either need to set up a dummy manual MMF and then buy/sell shares of it at $1/share. Or, IMO, a better option might be to simply hold it as Cash in the Investment account in which case you can then do cash transfers into and out of the account and there would be no MMF share transactions involved.

Phil Burton

@Boatnmaniac

Yup! Your reply was on the money. I've already set up that account and recorded transfers between my checking account and the new money market "savings" account. I know that super-strictly speaking, this is not a savings account, but I'm able to tolerate the cognitive dissonance. By the way, I set this account up as "offline." Since I will do 1-2 transfers a month in and out of this MM account, I can handle the manual entries.

I hope that other people can benefit from your suggestion. Should your reply be some sort of FAQ?

It sounds to me like you are describing a MMA, not a MMF. It also sounds
to me like you are manually managing this MMA. If I am correct, I would
suggest that you set up the account as a Savings account. You can name
it "MMA" if you wish or whatever else you might like to call it. Then
you can do simple transfers in and out of that savings account, just
like you would do at a bank between checking and savings.

Boatnmaniac

@Phil Burton - I'm glad you found my earlier reply to be helpful. Perhaps others will, as well.