Why are certain register entries not showing up in the budget?

Craig Marek

Specifically Home:Mortgage and Auto & Transport:Loan.

The category shows up in the budget, and as of today each has an entry in the register.

I also do not see future (remaining in the month) scheduled entries for these categories either.

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jacobs

Aha! Now we've gotten to the heart of the matter! The problem is that in accounting, a transaction can be either income/expense or a movement between two assets/liabilities — but it can't be both at the same time. And that's exactly what you've set up here: a transaction which is both a transfer and an expense.

In the earliest days of the modern Quicken Mac, the developers allowed such a transaction because there was no way to include transfers in a budget or an expense report. But it's bad accounting, so several years ago, the former Quicken Mac product manager said the senior executive team at Quicken had reviewed this issue and decided they needed to update Quicken to follow the proper rules of accounting. So over time, the developers built ways to optionally include transfers in reports and in budgets as if they were expenses — which they certainly feel like from a cash flow standpoint — without making them actual expenses and messing up the accounting. He said they would eventually make it impossible to make a transaction both a transfer and and expense, but that project seems to have fallen off the priority list, probably because they have to address the sticky problem of what to do with all such prior transactions users have in their data files. So you can still make a transaction which is both an expense and a transfer if you enter the fields in a particular order… and that causes the problem you've run into.

The other problem with the way you're doing it is that the 876.43 you're using as a transfer to reduce the loan account is reducing the loan account by the wrong amount. Your loan balance did not decrease by 876.43 this month, because part of the money you paid was interest. If you continue in this way, Quicken will show your loan account reaching zero, and going negative long before your loan is actually paid off. Meanwhile, your Mortgage expense also doesn't provide you the data you'd want for your taxes, which is how much mortgage interest you paid.

There are a few ways you can address this, and which way to do it depends on what you want Quicken to tell you. I'm wondering if there is a reason you didn't set up a Loan account in Quicken? It's designed so Quicken will record the same monthly payment to your mortgage company, but will calculate the changing monthly split between interest and principle so that the former is an expense and the latter is a transfer to reduce the loan account balance. And then in your budget, you would show the interest expense category and add a category for Transfers To:XYZ Loan account, so your budget reflects the cash flow view you want it to.

If there's a reason you don't want that, let us know and we can discuss other options for how to record this in Quicken. Otherwise, I'd suggest you go to Help > Quicken Help and click on the "Property and Debt" link on the left side, and then click and read through the topics on the right side for how to add a loan, enter your loan terms, etc. Once you understand how it works and set up the loan correctly, everything should be automatic each month. (You might have to make an occasional adjustment for a few cents if Quicken's calculation/rounding differs from your mortgage company.)