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I heard about Quicken (the personal finance software) long time ago. Last fall I decided giving it a try because I felt it’s harder to manage my bills and payments manually. My goal is to view all my banking, credit card activies, phone/utilities/home loan bills, and pay them in one place: Quicken. If possible, I would like to manage my investment, asset/liability, tax too.
Nine months later, my original goal was not quite accomplished. I still go to individual sites for the activities and bills, set a reminder in my Yahoo calendar before the bills due, and pay them when Yahoo send me the reminder. Pretty much manual process. Besides I am too cheap to pay Quicken for the “online bill pay”, and I was a bit slow to learn “Quicken”, another reason is I can not get away from old way of doing things, which obviously worked.
So this weekend I did a little study on Quicken. And I spend some time looking at the transactions and reports. I saw two problems with the software so far. One is the “automatic categorize” does not work very well, many transactions are simply “uncategorized”. As a result my “uncategorized” spending comprise more than 50% of my monthly spending, which is not very informative.
Second thing is more subtle, Quicken will treat the “payment to credit card from my checking account” as income, same as direct deposit of pay check. This will inflate my income and spending, because it also create a debit entry from my checking at the same time. In another words, if I buy a shoe using my credit card, it counted as one spending, when I pay the credit card, it will count that amount again. But I can not simply delete these transactions from credit card and my bank account, because that will make the number in both places inaccurate.
Welcome to the wonderful Accounting world.