Managing finances does not come easily to people. The task becomes even more difficult if you do not have the appropriate personal accounting tools. Quicken is one of the most popular financial management tools on the market. It has retained the first position since its launch. The software makes budgeting easy for users with its diverse features. If you want to know how to create a budget in Quicken, you have come to the right place. This article will talk about this process so that you can get a better understanding of it.
Read: How to Fix Quicken Error OL-226 When Adding Bank Account
How to Create a Budget in Quicken
The tool creates a budget based on your recurring expense categories. You can also remove or add categories as per your choice. Here is how you can create a budget in this finance software.
- To get started, tap on the “Plan” tab.
- Now select the “Budget” tab.
- Next, tap on the “Start” option and select “Budget Actions” followed by “Create New Budget”.
- Now enter a budget name.
- If necessary, you can change the “Advanced budget setting”.
- Now press “OK”. This is the final step in creating your budget.
- You can modify your budget in the “Budget” window.
What Budget Facilities You Can Find in Quicken
There are many facilities that this financial software provides to the user. They are listed below.
- Budget Types – Quicken provides the functionality to set budgets for each of your recurring individual expense categories. There is no income bracket or any transfer to the budget involved. However, if you want to add these categories, you can add them by pressing “Choose categories in the budget”. You can find this at the bottom of the “Budget” window.
- Budgeting method – Quickly budget the previous months based on the actual monthly expenses of the user. It also generates monthly expenses for future and current months based on the actual monthly expenses of the user.
- Using a date range – Funding software can also create budgets based on financial activities for the past twelve months. However, let’s say the user doesn’t have activity or transactions for a full twelve months. In such a situation, the software will make a budget according to the transactions of three months.
- Rounding used in software – Each budget is rounded up to the nearest dollar.
- Accounts and Categories Used by Quicken – Quicken develops budgets based on a user’s individual expense transactions in each of its accounts, excluding sales tax and Quicken invoices.
Which Categories Do Quicken Exclude from a Budget When It’s Initially Created
Finance software excludes specific categories from your budget when you first create it. They understand the following.
- Income categories
- Salary and Special Investments Section
- Categories of Miscellaneous, Uncertain and Interest Costs
- Categories with tax line item assignments provided. This includes:
- Schedule A – Home Mortgage Interest
- W-2 Local tax withheld
- W-3 Medicare tax withheld
- W-2 Medicare tax withheld
- W-2 Soc.Sec.tax withheld
- W-2 State tax withheld
Once you know how to budget in Quicken, you can easily add more categories and then customize them to suit your preferences.
How Can You Copy Your Present Budget to the Subsequent Year?
When the user views the previous year’s budget in a new year, the software asks if they want to carry it over to the next year. You can press “OK” and let the software automatically set up a new budget for you. This copies each of your budget values and categories to the new budget.
What to Do When You Want to Make the Following Year’s Budget before the Beginning of that Year?
It is for those who want to have more control over the creation of their budget. You can follow the steps given below.
- Change year via date control. You can see this at the top of the Budget window.
- Quicken will ask you how you want to create the budget.
- Copy the values and categories from the budget to your new budget.
- Copy the actual numbers and ranges from the budget as budget values to your new budget.
- Simply select and copy the budget categories to the new budget.
- For creating the new budget, tap ‘OK.’
Note that the budget you create will show income and expenses based on the financial activity for the year it represents. You can also edit the newly created budget without affecting any aspect of your previous budget. Apart from this, you can also make a budget for the previous years.
Making Sense of Color Coding in Quicken
When users are in “Graphical View”, they will find categories with bars of different colors. When you understand these nuances, you can quickly get a good idea of how your finances are progressing.
Green means you are not deviating from your budget. Red means your budget is over. Gray bars indicate no activity. Two things can be involved in this. Either you didn’t spend any money in this category or you didn’t make any money. The light green or red section represents an expectation of income or expenditure. You can use these alerts to prepare to pay bills. You can also schedule your upcoming expenses to align with your paydays.
Conclusion
The article will provide you with all the essential information you need to know how to budget in Quicken. This is a very simple process. But if you are still unsure about some aspects of it then don’t worry. You can get Quicken support anytime. Experts are always ready to help you and solve your problems.