Selecting a money market fund to not be a security in an investment account [Edited]

S Singer

I have two money market accounts funds in one brokerage account. How can I select which money market account fund I want to be considered as part of my cash balance?

[Edited to correct "account" to "fund" in several places.]

NotACPA

Help up to understand why only 1? And how should the other be considered?

Boatnmaniac

Who is your broker? The broker usually defines which MMF(s) can be used and downloaded as "cash". For instance, Fidelity Investments allows their customers to select which one MMF of three(?) can be designated as the Core Account (i.e., the Settlement Fund, etc.) and which going forward is downloaded as cash instead of shares. If there are other MMFs held in the account they will be downloaded as shares, not as Cash.

Chris_QPW

What I have found over the years is that there is some kind of "secret special code" sent by the financial institution that flags Quicken to allow the user to select a given mutual fund as "cash". I have financial institutions where it was never possible, and some that allowed it, but in all cases, it was never a choice of which fund to use, only the choice to treat the fund they presented as cash or not.

I'm with Chase now and they have like three different funds that they transfer money in and out of for various kinds of uses like, money waiting for the security sell to finalize, and one for holding cash, … Quicken allows me to set one of these as "Cash" (not my choice of which). If you are going to get a choice at all Quicken would have prompted you to ask if you wanted to do this when you first connected the account/security download. If you did this in the past and want to change your mind you can select the Update Cash Balance menu item in the investment account and you should see a "Cash Representation" button like this:

Selecting that gives:

You might consider voting on this idea:

https://community.quicken.com/discussion/7943516/let-users-choose-how-money-market-transactions-are-treated

S Singer

The Update Cash Balance is not available for cash in an investment account. It seems that Quicken makes the decision and that is all there is to it.

Chris_QPW

Update Cash Balance is always available in an investment account as long as it isn't in Simple investing mode, but it is the Cash Representation button that will not be there if Quicken doesn't give the option of treating a given security as cash.

S Singer

It is "available" but useless.

Chris_QPW

https://community.quicken.com/discussion/comment/20469371#Comment_20469371

Oh, yes, forgot about that option, and that just makes everything even more complicated.

Using the option to link your investment account to a checking account means that Quicken creates a "virtual checking account" and when "cash transactions" are downloaded into the investment account Quicken pushes them to the virtual checking account.

Boatnmaniac

But if you have opted to have the cash pushed to that linked checking account then it is logical that you cannot update the cash balance in the investment account. Instead, go to the linked checking account where you can reconcile and update the cash balance.

Chris_QPW

https://community.quicken.com/discussion/comment/20469434#Comment_20469434

The point isn't to update the cash balance. It was just that I noticed that the "option to use a mutual fund as cash" was there. The idea was just to go there and see if the option had already been set to the wrong thing and could be changed.

The bottom line is that Quicken is using some kind of bit of data downloaded from the financial institution to try to decide what security is being used as "cash" and give the user the ability to decide to treat it as a security or cash. Whereas I think this is too limiting. First off, not all the financial institutions send the information that Quicken must be using to decide this, and second for cases like Chase where they are using multiple securities as cash the user really should have an option to just list what securities should be treated this way.

That is what the Idea thread that I posted is about.

Boatnmaniac

https://community.quicken.com/discussion/comment/20469458#Comment_20469458

This thread appears to have hopped around quite a bit. I understood the initial question to be about how to select which MMF will be included in the Cash Balance instead of downloaded as security shares.

I had then asked @S Singer who the brokerage is because the answer to their initial question is largely dependent upon who the brokerage is. Until they answer that question it is really difficult to answer their initial question.

Then is started addressing things within Quicken that can have a bearing on answering the initial question, but that information is not applicable to all brokerages.

Then it morphed into how to update the cash balance which both you and I provided answers for, depending on whether or not the cash is held in a separate linked checking account.

So, I'm really confused about what the subject of this thread is and what it is that is really being inquired about.

BTW, I do not agree that Quicken is somehow instructed by the brokerages to treat certain MMFs as cash instead of security shares. That might certainly be true in some cases but it is not true in all. For instance, Fidelity gives us the ability in our online account to select which MMF is our Core Account (i.e., Settlement or Sweep Account)…otherwise it will default to SPAXX. Then Fidelity says on their website that they will download the value of that MMF as the Cash Balance and will not download the shares nor Fidelity transactions for it. However, the shares held and all the transactions will still be visible in the online account even though they have not been downloaded. I've done Google searches on this and found discussions about this process from more than 20 years ago so it is nothing new.

For the most part Fidelity's downloading like this works well except in 2 situations:

1. If the account preference in the online account is that Dividends be reinvested, then Fidelity will download the ReinvDiv transactions but will also download the value of those ReinvDiv shares as Cash. So the value added to Quicken is 2X what it should be. Change the preference to deposit the Dividends to the account cash balance and this issue stops. (To resolve the duplication of value issue for previously downloaded ReinvDiv transactions those transactions need to be changed to Div with the cash added to the account balance.)
2. If/when the account holder places actual Buy or Sell orders for this MMF, then the transactions will download and shares will be added or deleted to the holdings. And the cash balance in Quicken will increase or decrease by the same amount so the value, again, gets changed by 2X what it should. The solution is to not place any Buy or Sell orders for the MMF. (To resolve the duplication of value issue for previously downloaded Buy and Sell transactions those Buy and Sell transactions need to be deleted.)

So, with Fidelity accounts, Quicken simply imports and processes exactly what Fidelity downloads. And there is nothing I can do from inside Quicken to change what Fidelity downloads to Quicken nor to change which MMF will be downloaded as Cash.

Chris_QPW

@Boatnmaniac I agree this subject has meandered around, and maybe depending on which financial institution @S Singer is using there might be an "easy fix" like you said is possible with Fidelity, but the reason it is so complicated is because not all financial institutions do it like Fidelity, and it might even be argued that the way they do it isn't 100% correct either.

This is why I believe that Quicken should implement the idea that I pointed to.

In the case of Fidelity, they have basically taken the choice off the table for Quicken and "mostly" given it to the user on their website (the user can't treat it like a security in Quicken).

For any financial institution that instead of sending transactions for the mutual fund they change them into the cash balance, there is basically nothing Quicken can do about it, for good or bad. You will absolutely know that is happening because you will never get any transactions for that security. It will all just show up in the cash balance.

For the other financial institutions, they do send transactions buys/sells for these securities. In general, my take on all of this has been "don't fight the system". Clearly if the financial institution isn't sending the transactions for the security, they you would have to manually enter them if you wanted to "force showing them in Quicken" instead of the cash balance. On the flip side, if the financial institution does send the buys/sells, I have generally found it better to just accept the fact that you will have a security that represents cash and accept the transactions opposed to deleting them so that Quicken uses the cash balance. Note that even though I say in general you shouldn't fit the way the financial institution is doing it, there is something to be said to have Quicken deal with it as cash, especially if you are in the boat like I am where there are multiple funds treated this way. For instance, Vanguard sends this as a security (and no Quicken doesn't give an option to treat it as cash for some reason), and it not only adds more transactions that aren't that useful, and makes it harder to do things like 30% cash, 20% Large Cap, … Vanguard had these "lagging" a few days after the buy/sell of the security that prompted the movement of cash.

But this is where the "secret/magic something download" comes in. For some financial institutions that are sending these buys/sells Quicken will prompt and ask if that security should be treated as cash, and what that means is that Quicken automatically deletes the buys/sells for that security.

Note other than the prompting of you when Quicken first sees this security/account, and the "Cash representation" this also pops up in the preferences (but not exactly in the way is wanted here): Edit → Preferences → Downloaded Transactions → Never interpret downloaded Money Marget funds as cash.

S Singer

I simply give up. In Schwab I had two MMA, one was linked and one was not. I closed teh linked account and there seems to be no way to link the remaining account. I will simply use a work around. It should not be that hard for Quicken to allow the user to designate a specific MMA as a cash account.

Boatnmaniac

@Chris_QPW - I agree with you on all points. Especially that point about "don't fight the system" because it will ultimately be no end of frustration and workarounds if/when one tries to do that. It's works so much more smoothly and frustration-free by adapting and learning to roll-with-the-punches.

Boatnmaniac

https://community.quicken.com/discussion/comment/20469550#Comment_20469550

Ah, so it is Schwab. I wondered if that might be the case. Schwab has defined which 2 MMFs can be treated as cash for nearly 2 yrs now: SWVXX (Value Advantage Money Market Fund) and SWGXX (Schwab Government Money Fund). It was a Schwab decision to do this, not Quicken's.

You also did not tell us which MMF it is that you want to designate for the Cash Balance. If it is either SWVXX or SWGXX then you should be able to designate the one to use but since I do not have any Schwab accounts I am not sure how that is accomplished. Perhaps someone else with more knowledge of Schwab will pipe in here and tell you how to accomplish that.

But if you are wanting to use a different MMF than either of these as the Cash Balance you will be "fighting the system" and then that is and will to be the source of your frustration. And if how it is reported in Quicken does not meet your needs or wants you will need to address that with Schwab. You could also vote for the Product Idea mentioned by @Chris_QPW in his 1st post in this thread because if Quicken can find a way to make that work then maybe that would be the answer to your quandry.

As for me, Fidelity also gives me just 2 MMF options to designate as the Core Account (i.e., "cash") but the reality is the one that is selected is simply the first Fidelity goes to for cash-related transactions. If that Core Account MMF does not have enough in it to cover the transaction then Fidelity will automatically transact the difference against other MMFs that I hold and that supplemental MMF transaction occurs almost instantaneously in parallel with the withdrawal from the Core Account MMF. So I have long ago learned that as far as Fidelity is concerned all of my MMFs are really cash-equivalent even though only one is reported that way to Quicken. I'm guessing it might be the same for Schwab but I can't know that for sure since I have no accounts with Schwab.

Chris_QPW

Now that I know that this is Schwab, I can add this tidbit. People using Quicken Mac have threads where they have complained about the same thing.

And I didn't really follow what the problem was until you guys pointed out that Schwab is in fact using two Mutual Funds for "cash". And it really sounds like Fidelity is doing the same thing in some cases. And here is the fun with Chase (I can only assign QDERQ).

First it has what I guess for IRAs interest (for the cash in the account) 2145600, and 2110991 seems to be for the same purpose for Brokerage accounts. These are always downloaded just as Income action, so really just as the cash balance with the security named for the transaction.

Then there is "US DOLLAR", this seems to be where they hold the cash while the transaction is pending. I don't see transactions for these, but it does show up when comparing shares in Quicken to what is sent (in the summary information only). I just ignore compare fails on this one.

Then there is QDERQ this is the one that I can treat as a security or a cash balance.