Quicken


Yes, being away from Quicken for the last 60 days has been a very serious problem.

I just found out that I am eligible to participate in the company’s stock purchasing program. This means I can buy company stock for a fixed discount and pay little to no fees for the privilege. I thought I wouldn’t be able to sign up till July 1st, because I wasn’t employed by the company on January 2nd during the last sign up period in 2007. (I didn’t start till a few days later.)

Quick like a bunny, I signed up electronically so I wouldn’t forget. Unfortunately, I signed up for 10% of my gross paycheck in my excitement to sign up without going home and carefully budgeting what I could afford to save. (One of the minor reasons I took this job was because of this juicy opportunity to purchase stock at a discount.) Later on, I realized this means I am now saving 10+% of my pre-tax salary and 10+% of my post-tax salary. AND to top it off, my next paycheck will have an extra $200 taken out for Myanmar and China aid charities. EEK. My take-home pay for my next paycheck will be uncomfortably low.

*GASP* I might not be able to make a ginormous credit card payment of $1000. Boo-effing-hoo, right?

I know. There’s a lot of folks out there sweating bullets over finding a job after graduation, or feeding their kids, or buying gasoline and I’m crying because I won’t be able to pay down my credit card faster.

What I’m really trying to say is that I miss my financial planning software and if I didn’t have some sort of idea of what my monthly expenses were, I’d have NO CLUE that I was saving overzealously and would need to figure something out for short term cash flow issues later this month. (Geez. Is there such a thing as an “impulse saver”? If not, can I take credit for coining the term?)

I think I’ll end up ok since I have a CD expiring soon and I still have some stimulus package money left over, but I’m going to be hoarding cash till after 4th of July when I’ll be able to get a good understanding of what’s happened the last 2 months away from Quicken and a few paycheck cycles buying in on company stock.

I’m not kidding. Everyone who is tracking their money ought to have a software program to look at their accounts. Unless you are an anal retentive accountant who keeps old school ledgers, I doubt you balance your accounts by hand and keep it up to date all the time.

I have got a serious cautionary tale for you. Full windmilling arms and all. This Chicken Little has a true story to tell.

Once upon a time, (this past March) Chicken Little got a bonus. (hooray!)

Chicken Little’s old miserable place of employment did not take a 401k contribution from her bonus check or give a corporate match. (boo!)

But her new merry place of employment is generous and takes a contribution and offers the corporate match. (yay!)

Chicken Little, being the diligent little scratcher, runs home with her paystub and enters in all the numbers from her bonus paycheck into Quicken.

A few days later, Chicken Little’s 401k plan administrator buys new mutual fund shares with the fresh influx of cash. (mmmm, tasty!)

While her new shares start to grow and grow, Chicken Little minds her own business. A few weeks later, Chicken Little decides to check her garden of 401k money and opens her 401k account to key in her bonus check transactions.

As she inputs data into Quicken and sees there is a problem. (oh no!)

For some reason, there is a cash balance in her 401k account. (how strange!)

Chicken Little, being a wee ditzy, decides to let it slide. (silly!)

She lets is slide for weeks and weeks. Many paychecks come through (yay!) and she creates her 401k mutual fund transactions and still there is a mysterious cash balance. (weird!)

Eventually Chicken Little calls the 401k company and complains. (cue scary music)

The friendly agent (surprise!) takes the information and promises to investigate.

Two long, agonizing weeks pass, and Chicken Little’s desk phone rings at work. (hello?)

It’s the 401k company! (wow!) They have investigated the purchases around the time of the bonus check and indeed, they only received X amount of money. (boo!)

Fear not though, the friendly agent has a plan. (yay!) He recommends calling the payroll department and asking them about their transfer of funds.(yay!)

So Chicken Little contacts payroll and the friendly lady says bring your paystub down and we’ll investigate!(yay!)

Chicken Little is still on pins and needles waiting for the friendly payroll lady, but at least she has her Quicken to tell her when her accounts are not balancing properly and there is a ~$70.00 shortfall of money in her 401k account, which throws off her net worth reporting on her blog. (boo!)

I know. Very silly. But it’s true. I never would have caught the error if Quicken’s running account balance hadn’t been thrown off week after week by a suspiciously familiar amount of money. (It just so happens to be the amount of corporate matching I got last year on each check.) After about 2 months I decided there was definitely something wrong and not just me messing up my data entry.

So far so good. There is an acknowledged discrepancy from my paystub and what was received by the 401k firm. I still have to follow up with the payroll department. I hope they compensate me at the current rate of shares for the lost investment, but I will be happy if they just make sure I get the money that’s missing.

Go get a personal finance software program like Quicken or MS Money. I don’t think YNAB is good enough. Budgeting isn’t enough here. Neither is something like Yodlee which lets you view your balances all at once.

You really should have something that shows you transfers between accounts to ensure they actually balance out. If I couldn’t see that there was a balancing/reconciliation problem between my paycheck deposit into my checking account and my 401K account, I could have lost ~$70.00 for good. As it is, I have a chance at recovering it. That’s a pair of cheap tickets to the opera, or else a single really good seat for one!

I am liking and yet hating Turbo Tax right now.

I love it because I got a crazy federal refund in 4-digits that I wasn’t expecting. I am also getting a refund for VA state taxes. However, I hate Turbo Tax because now I have to print out the forms and white out the $30 telephone excise tax because I don’t have long distance service at home.

It’s a long story, but I don’t have any and my cellphone is paid for by someone else, so I cannot take that credit. SCREW TURBO TAX and the inability to delete line items like this one. For some reason, you can zero out some items, but not this one.

I also really hate the way TT integrates into my Quicken. I must have really effed up my categories when assigning stuff last year, like my medical expenses and tech books. I will say that for some of the home business stuff I have going on, it’s worked out quite well.

I was really afraid of preparing my taxes which is why I procrastinated for so long. I had no idea if I was going to owe or get a refund till this very minute. I took some side income, about which I have not blogged, and that was making some serious impacts.

My single best piece of late advice is to do intermittent saves, more often that TT prompts you to do it. I wasted an hour after closing what I thought was an informational window and not understanding the pop up message about saving.

Note to self: Accrual basis, not cash.

Yes indeedy. I did it.

I am cheesed off with Wachovia for charging me to download from within Quicken, but not so cheesed off as to kill that account. I really do feel more comfortable with a brick and mortar bank locally. So this means my Philadelphia based checking bank is going the way of the dinosaur. I feel so bad because I opened that account in 2003 at the bank branch I used to go when I was a little kid with my piggy bank. I still think of it as my bank, even today, though I don’t even take cash out of their ATM’s when I go home. Screw the sentimentality, let’s talk brass tacks on why I chose ING.

1) I already have a relationship with them: I really didn’t want to go through the annoyance of learning a new GUI with Virtual Bank or NetBank. It was extremely easy for me as an existing account holder to click a few clicks and open a checking account.

2) It’s paying 4.00% APY: My old checking account paid no interest at all and was free with direct deposit. Seems to me, for the $1000+ deposits I would make there for my fixed expenses, I might as well earn some interest on the float while the funds were still in the account.

3) It uses Quicken! Sounds crazy, since all banks pretty much have an interface with Quicken. But for some reason my old bank in PA was really behind the times on this and did not integrate well with it. I had to get crazy stuff set up by calling a rep, etc. It was phenomenally stupid, so I didn’t bother with transaction download. Because this is a low-traffic account for fixed expenses. I could pretty much balance it once or twice a month with Quicken’s reconcile feature and it would work just fine.

4) My girlfriend did it first: One of my local friends was asking me about it. I told her I really didn’t know much about it, but then she decided to do it because of Reason #2. She seems pretty happy with it and has no serious complaints other than the fact the ATM card hasn’t arrived yet. But for me, I won’t even use the ATM card since I have my local brick-and-mortar bank which is convenient enough to home and office.

5) I think there is a hard credit pull: There is an overdraft protection feature that offers you X dollars of credit. I am pretty certain this means they’ve done a hard credit inquiry. Yes, I realize this possibility may drop my credit score, but I don’t really care since I haven’t opened a credit account since June 2006 and have no plans to open another for any reason whatsoever in the next 2 years. EDIT: Per Reader Dave, there is no hard credit pull, via the ING FAQ. THANKS DAVE!!

I haven’t done anything yet with it. I am in the process of transferring over my direct deposit from work. I did set up some of my regular outgoing expenses and that was fairly easy. I don’t like going entirely paperless, but I don’t think this transition will kill me, and perhaps it will help me tame “the paper tiger” around the house. I keep too much paper crap and it’s bugging me. I actually spent some time de-cluttering the mess on my desk and I am happier as I write this post.

PS - I just noticed that the DST change has effected the posting of my posts since March 11th. I just added an hour to the time on this post to reflect the accurate time.

I netted out about ~$14,000.00. I was hoping to net ~$18,000.00, but I’ll take it. I can genuinely say that my Save-O-Meter, FSA and 401K totals that $14K, so I think I’ve accurately hit my personal goals for 2006, despite going over budget.

I drafted up a recap of 2006 with some goals for 2007, but now I see I’ll have to revise my goals for 2007 based on a new budget plan. I have to be realistic about what fits into my budget in terms of savings. (Oh wait. I think I’ve just written my dream goals…)

I suck at sticking to a budget. I really do. I don’t track every nickel and dime accurately especially when it comes to dining out and items paid with cash. But I can definitely see that I benefit from budgeting by being able to do a quick and dirty analysis.

Even if you blow your budget, make one anyway. It’s a navigational guide for your spending and saving, but don’t cry if you miss your turn. Just regroup by revising your budget to be more realistic, and get back on the proper route. Knowing what I might spend or have spent in the past allows for me to make adjustments. Another surprise was that my vacation travel, i.e. all those weddings, was overbudget by ~$300.00, the cross-country airfare of one wedding. If I hadn’t budgeted my whole year, I never would have foreseen that I had to cut my personal vacation to pay for those wedding trips. You regroup. You adjust. Even if you are damned lazy like I am.

How lazy am I? I probably only look at a budget report once a quarter. Quicken lets me see a montly income/expense graph when I log in. However, it’s pretty skewed due to quirks in my graph settings, based on accounts and budget categories to include. It’s messed up and I don’t think about it that much. I literally just count which months I haven’t spent more than I earned. (For the record, on the small graph it’s 8. On the full graph, it’s 9. See what I mean about it being kind of screwy?)

Quick digression: Most PFBloggers probably don’t have formal accounting training or work in accounting. (I should probably figure out how to do a poll. If you want, please comment with a yea or nay.) I would encourage everyone to take a basic college-level financial accounting class for a few reasons. A) You’ll learn how to make an income statement and a balance sheet, which is really all you’re doing for yourself when you prepare your net worth statements or budgets. It’ll make numbers less scary. B) You’d be surprised at how much money executive education programs make by teaching financial analysis to non-finance managers. It’s a marketable skill for your resume. C) You don’t have to major in it or be a CPA, just one single 101 course. I took mine after I graduated from college and found myself doing lots of accounting stuff at work. D) And it’ll help you see the importance of budgeting and why companies do it, even if you don’t do it for yourself.

Budgeting does not exist to set you up for failure. I don’t feel like I failed even though I missed my budget. Not at all. I am proud that even though I overspent, I hit two important savings goals I set for myself.

Please let me know if you don’t have a budget and if you’re going to try one for 2007. It’s a pretty good new year’s resolution if you don’t have one already and semantically, note that I wrote ‘TRY’, not ’stick to’. It’s an evolutionary process, which reminds me to ask Madame X, how long have you been budgeting and how do you get such budgeting perfection?

Surprisingly, there were some good things in my budget.

On the income side, because I made an effort to save, I made ~$100.00 in interest by doing nothing but saving! I like that! I don’t think 2007 will see a comparable number unless people want ING referrals from me. The ones I got from 2006 were categorized as interest income. (Email me at mapgirlsfiscalchallenge at Google’s mail service.)

I saved money on my car insurance, and the savings is approximately the cost of my new homeowner’s policy I had written this year. I expect this savings to be eaten up by a rise in premiums next year.

I don’t know about you, but I plan out what I’m going to pay in credit card interest. For some reason, I paid ~$100.00 less than planned this year. I must be some kind of pessimist!

Though I splurged on a ridiculously expensive skirt this year, I was under budget by ~$900.00. I think Frumperella can reassess this figure completely for 2007.

My crack habit, er, excuse me, my YARN habit was under budget by ~$100.00. Thank god I quit my second job at the crack house, i.e. yarn shop. I spent most of my budget in two purchases during their annual clearance sale at the beginning of the year. I think I realized what I was doing and made sure not to buy anything else unless I REALLY needed it. Now I don’t feel so bad buying high quality kid mohair as a year-end gift to myself.

My gift budget looks like I was under ~$300.00, but that doesn’t seem right due to a weird little transaction I did with my sibling to buy wedding presents for my cousin. I was probably under by only ~$150.00. The other thing is that I tend to buy lunches and dinners for friends as treats for their birthday, and I put that all into my dining out category. Remarkably, I wasn’t ridiculously overbudget by dinging out, which is why it didn’t make the BAD list.

Before you chide me for dining out a lot. I was totally on budget with my spending AND I grossly over estimated my grocery budget by ~$1200.00. It’s not like I overspent on a generic category of ‘FOOD’. This also will have to be reassessed for next year, including another $250.00-$350.00 case of wine. My wine rack is empty and needs replenishment.

I don’t understand Quicken sometimes and I think this has to do with my screwy allocation for healthcare benefits from work, but I was under budget by ~$1800.00 for a generic ‘Insurance’ amount.

Surprisingly, my medical expenses were not way out of budget. I was under by ~$200.00. But I will have to carefully plan 2007 since I bumped up my Medical FSA and I still have a mountain of expenses to cover. My dentist was very clear on how much stuff will cost me for each item I’m having done which allowed me to change my FSA allocation. Make sure you ask yours for an outline of charges. They really should be able to give you one if you ask.

Last interesting category is my taxes. I got refunds from DC and VA, but only after overpaying VA due to their weird auditing practices. If you don’t include my property taxes on the car and condo, I actually over budgeted by ~$1000.00. I think this is primarily due to ramping up my pre-tax contributions and deductions.