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Allow cash management accounts to be grouped with "banking" rather than "investments"

BrittMayo

I have a Fidelity Cash Management account that holds CDs and money market funds. It is, for all intents and purposes, a "high-interest savings account"; however, Quicken only offers "Investment" and "Retirement" as Account Intent.

Would you please consider adding "Banking" as a choice for Account Intent for this type of account? Then, when I move money into and out of the cash management account, it wouldn't change my "banking" and "investment" balances.

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Comments

NotACPA

Fidelity is a brokerage, not a bank, so unless you're using the "Show Cash in a checking account" option for your taxable brokerage account(s), all Fidelity holding ARE properly, investments.

CDs and MMFs are securities that you're holding IN an investment account … they're not Banking positions.

BrittMayo

NotACPA - I understand your point; however, I do not consider CDs and money market funds to be "investments." Rather, they are places to keep your emergency and other cash reserves that earn more than the nominal interest a bank pays but are not intended to increase in value as "investments" would.

The fact that Fidelity is a brokerage does not change the nature of the account: functionally, it's still "banking." So much so, in fact, that the assets in the account are FDIC insured.

As an aside, even though I personally don't use it, Fidelity cash management accounts are often set up to distribute very large amounts of cash across FDIC-insured banks so that a customer with $1 million in cash could spread it across 5 banks and maintain full FDIC coverage while managing only one account. So in those cases it literally IS "banking."

Besides, if Quicken offered the "banking" option, you could decide to categorize your Fidelity account as "investments" while I categorized mine as "banking" and we'd both be happy. Seems easy enough for them to do, and win-win for customers.

agninboston

I have the same issue and agree with BrittMayo - I should be able to categorize based on how I view and use the Cash Management Account.

NotACPA

A Fidelity Cash Management Account is an Investment account, not a bank account. CD's and MMF's are investments, not bank accounts. They earn interest/dividends and many people use such for their investing.

Plain and simple, Fidelity is legally prohibited from offering "bank accounts". You're asking that Q misrepresent the truth, which is ALWAYS a bad idea.

Jim_Harman

@BrittMayo Regardless of the legal structure of the account, you can choose the "Show cash in a checking account" option for your CMA account and at least the money in the account's settlement fund will be included with your other banking accounts and reports in Quicken.

What do you want to be able to do with the account that you can't accomplish by setting it to "Show cash in a checking account"?

Boatnmaniac

To my understanding, none of the securities in a Cash Management account are treated by the brokerage as "cash" except for possibly the core position/settlement MMF or the Sweep bank deposit. The other securities must be sold in order to generate cash.

Have the core position/settlement MMF or Sweep bank deposit to be shown in Quicken as the cash balance. Then change the account to have that cash shown in a Checking Account and that checking account will be grouped along with other bank accounts.

The other securities will continue to be shown in the investments grouping until they are sold, as they should be. Once they are sold the cash will be automatically transferred into that separate link checking account.

This process for this already exists in Quicken without any other programming changes being needed.

Jim_Harman

To partially answer my own question, one issue I have seen with the "Show cash in a checking account" option arises when you sell one security in the account and use the proceeds to buy another, for rebalancing for example. In reports, this can show up as large transfers between the checking and investment sides of the account and large swings in the checking account balance. You can control these swings by including the investing side of the account in your spending reports and selecting the "Exclude internal" option for transfers on the report's Advanced customization tab.

BrittMayo

Thanks for responding, Jim.

My want is very simple: On the "My Money" home page, I want to see the cash management account included in the first (banking) group rather than the second (investing) group so that when I move money between bank accounts and the cash management account my available funds and investment balances don't go up and down.

It's the same rationale for me as when I pay off a credit card balance - that doesn't increase or decrease my available funds.

BrittMayo

Agree that CD ladders and MMFs are not treated by the brokerage as cash, but for personal finance purposes they can serve the same purpose as cash (e.g., they hold the emergency cash reserves that you hope to never have to need but don't ever want to be without). And, as noted earlier, some cash management accounts are pure banking as they spread funds across multiple FDIC banks.

Quicken today forces users to treat all of these as "investment" for the Account Intent. What I'm suggesting is add the option to change the Account Intent to "banking" for those of us who look at them as I do.

BrittMayo

Plain and simple, if I have a Fidelity Cash Management account that is 100% sweep across multiple banks to allow me to have a higher level of FDIIC insurance while only managing one account, the "Account Intent" is CLEARLY, UNARGUABLY, LEGALLY and CORRECTLY "Banking."

Procopio

I have this same problem. I have thought about just creating a manual offline account, and manually adding the interest each month. There are no other transactions besides the interest each month, so this would be pretty easy to manage manually. And it wouldn't have to connect to Fidelity, so I could show it in the checking section. Haven't done this yet, but it's what I'm thinking about.

Jim_Harman

@Procopio That would be set up as a manual offline savings or checking account, right? That would work if the CMA account only holds money market funds and other securities that do not change in value, you want to think of it as a banking account, and there are not many transactions.

Brokered CDs can change in value as interest rates change, so it might not work for them.

Jim_Harman

@BrittMayo Listing brokerage accounts with banking accounts in Quicken may be more complicated than it seems. With a brokerage account, the market value can change over time even if there are no transactions, and banking accounts do not have to handle realized gains and losses.

If you have a brokerage account that you want to think of as cash and you want to see it along with your banking accounts, you could customize an Account Balances report to include just that account and the banking accounts.

BrittMayo

Good point, Jim.

All I'm really after here is to have "Banking" and "Investment" balances on the home ("My Money") page that reflect my reality, in which my CD ladder and money market funds represent emergency cash, not investments, and where the balances don't swing substantially when I move money from my checking accounts to the money market fund, and vice versa.

Sceptic

@BrittMayo I can understand the rationale behind this request. Many brokerage-based cash management accounts function more like checking or savings accounts than traditional investment accounts. The request is not necessarily to change the underlying account type, but to allow users greater flexibility in how those accounts are categorized and grouped within the Account Bar and reports.

While the account may technically be an investment account because it can hold securities such as money market funds and brokered CDs, some users view the assets as cash reserves rather than investments. Allowing an investment account to be grouped with Banking assets could better reflect how those users manage their finances.

If there were no programming issues in allowing this grouping or account intent flexibility, then I personally don't see an issue with it.

Boatnmaniac

It seems there are 2 different things being discussed here that appear to have been tripping up the discussion: Account Type vs. Account Intent.

As I now understand it, what @BrittMayo is requesting is not to change the Account Type from Investment to Spending but to add Spending as an Account Intent option. It is my understanding that changing the Account Intent has no bearing on the Account Type functionality, it just changes where the account is grouped in the Account List.

Checking and Savings accounts can have the alternate Account Intents of Investment, Retirement and Asset. Why can't Investment accounts have the alternate Account Intents of Spending, Retirement and Assets, as well, provided there is no impact to the Account Type functionality?

Unless someone can confirm that making this Account Intent change would adversely affect Account Type functionality, then I can support this request.

Jim_Harman

@Boatnmaniac It is hard to tell what the side effects of allowing brokerage accounts to have an Account Intent of Checking or Savings would be.

In addition to the groupings in the Accounts Bar, this would affect some reports and Home tab panels.

Currently you can set the Account Intent of banking accounts to Investing, but it has odd effects in some reports. For example in the Investment Performance report, a banking account with an Intent of Investing is included in the report but shows a weird Average Annual Return and several blank lines. It has the feeling of something that was never thoroughly tested, and I am concerned that this proposed change would have similar odd effects.

BrittMayo

As things are today, having a cash management account in "investments" DOES distort the performance of the overall portfolio. And if moving it to the "banking" intent group were to distort the performance of the banking group that would be less problematic, since I never expect there to be, nor look at, the account performance of that group.

MikeChicago2

I don't agree with some of the arguments made that a Fidelity Brokerage account is actually a Bank account, but I have a different reason why I would like Quicken to allow it to be classified as such. The Quicken Classic mobile app only displays future (scheduled) transactions for Bank accounts. I use one of my Fidelity brokerage accounts exclusively as the equivalent of a checking account for many of my auto-payments of credit card, utility and other bills, check writing and other transfers, and never use it for any investments other than Fidelity money market funds. So if I'm traveling and want to use the mobile app to look ahead at upcoming scheduled transactions to assure I have sufficient funds, etc., I cannot see what is upcoming for this Fidelity account. I have previously recommended that Quicken enable the mobile app to also show scheduled transactions for Brokerage accounts for this reason, but enabling a Brokerage account to be treated as a Bank account would also address this issue for me.

tejlwright

Feels like what the original poster is asking is a small ask actually. Don't think he's asking to change how the account operates or is handled, only where it's displayed for his own personal use. Was an accountant for over 40 years and love Quicken and have used it always every day for years for my personal home bookkeeping. Works great for that but never been under the idea it was the be all and end all of accounting software. If it was it would use Debit and Credit instead of Payments and Deposits in my checking account. Wanting an account displayed in another spot in a list as a personal preference without a work around doesn't seem like a big deal.

Boatnmaniac

Have you tried going to the General tab of Account Details and then select the option to show cash in a checking account? That checking account will be shown in the same group as other checking accounts and, if memory serves me correctly, Reminders and future dated manual transactions will be reflected there just like they are in regular checking accounts. Are you saying that these future dated transactions in this linked checking account do not show up in QMobile?

Boatnmaniac

Feels like what the original poster is asking is a small ask actually. Don't think he's asking to change how the account operates or is handled, only where it's displayed for his own personal use.

That was my earlier impression, as well, and I had cast my vote for it assuming that by adding and allowing this "Intent" change it would not adversely affect other functionality and data reliability in Quicken.

But @Jim_Harman noted that changing the Intent of other types of accounts has had some adverse impacts so that raised questions about the risk of that also happening if taxable investment accounts were allowed to have an Intent of Spending.

And then the OP came back with a response that kind of blew me away by indicating that they would be OK with that because it would give them want while at the same time expressing no concern about how such a change might adversely impact other things in Quicken and how that risk might adversely affect others. Can you imagine how many complaints could possibly be posted in this Community forum and problem reports submitted to Quicken by others who would also make this Intent change without knowing how that might possibly affect their data integrity/reliability of their Investment accounts and portfolio? I'm not saying it would cause issues but we need to better understand if there would be risks and how to mitigate them rather than simply barreling full steam ahead.

So, I withdrew my vote for this idea….at least for now. I cannot support any change that might benefit a minority but would possibly put at risk the functionality and reliability of the data for the majority, especially when there are already alternate methods in Quicken that can be used to reasonably accomplish the same thing that that original poster is wanting to see.

MikeChicago2

Boatnmaniac was kind enough to suggest this solution to the issue I described in my post yesterday: "Have you tried going to the General tab of Account Details and then select the option to show cash in a checking account? …"

I was unable to find that option and called Quicken support who told me it was not available in the Mac version of Quicken. I hope it works for any of you Windows guys without causing any problems.

Boatnmaniac

Sorry, I didn't realize you are using QMac. This is a QWin thread. Your post yesterday was still appropriate for this thread but my QWin reply (along with perhaps some of the other options and workarounds in this thread) was not applicable to QMac.