How to categorise transfers?

Hi all,

I hope one of you experts can help me.

I have a liability account for my car loan.
I have monthly transfers from my bank account to my car loan account.
I want these transactions to be categorised as a car expense so I can report
on all car expenses. But I dont see a place to select a category with a
transfer transaction.

Thanks for any help!

A transfer as such doesn't have a category. What does have a category is the
payment to the loan company.

Effectively a transfer is simply moving money from your left pocket to your
right pocket. It is still yours until you take it out of your right pocket
(and pay it to the loan company).

--
Regards
Bob Peel,
Microsoft MVP - Money

For UK tips & fixes see
http://support.microsoft.com/default...d=fh;EN-GB;mny.


I do not respond to any emails that I have not specifically asked for.

"Kimberly Anderson" <KimberlyAnderson@discussions.microsoft.com> wrote in
message news:71338B51-5702-4257-9706-428C8CB8CF5A@microsoft.com...
> Hi all,
>
> I hope one of you experts can help me.
>
> I have a liability account for my car loan.
> I have monthly transfers from my bank account to my car loan account.
> I want these transactions to be categorised as a car expense so I can
> report
> on all car expenses. But I dont see a place to select a category with a
> transfer transaction.
>
> Thanks for any help!

Thanks for the quick response Bob!

How then should I have set up my car loan situation so that I can report on
it as a car expense?

thanks again.
Kimberly


"Bob Peel, MVP" wrote:

> A transfer as such doesn't have a category. What does have a category is the
> payment to the loan company.
>
> Effectively a transfer is simply moving money from your left pocket to your
> right pocket. It is still yours until you take it out of your right pocket
> (and pay it to the loan company).
>
> --
> Regards
> Bob Peel,
> Microsoft MVP - Money
>
> For UK tips & fixes see
> http://support.microsoft.com/default...d=fh;EN-GB;mny.
>
>
> I do not respond to any emails that I have not specifically asked for.
>
> "Kimberly Anderson" <KimberlyAnderson@discussions.microsoft.com> wrote in
> message news:71338B51-5702-4257-9706-428C8CB8CF5A@microsoft.com...
> > Hi all,
> >
> > I hope one of you experts can help me.
> >
> > I have a liability account for my car loan.
> > I have monthly transfers from my bank account to my car loan account.
> > I want these transactions to be categorised as a car expense so I can
> > report
> > on all car expenses. But I dont see a place to select a category with a
> > transfer transaction.
> >
> > Thanks for any help!
>
>

Well, you could report it in some reports by including transfers in the
customization.

The real key to understanding this is that your car expenses associated with
this loan are a) the interest expense you are incurring for renting the
money, and b) the original purchase cost which you incurred the day you
bought the car. The principal Transfer component of the Loan Payments is
just transferring money from one pocket--an asset account like a checking
account, to another--a liability account.

For this reason, some people who really want to view the payments as the
expense just skip modeling the loan account in Money and treat the payments
as some expense every month. I do not recommend this as it masks the true
financial nature of what's going on.

One other way is to "classify" the automobile-related movements of money.
Classification is a parallel scheme to categorization and allows you to,
say, note that the Principal Transfer is classified as Automobile:Acura TSX.
Classification is handy because you can put it on, say, Automobile or
Vacation or Property or whatever, related expenses that are not obvious.
With classification, for example, Taxes:Sales Taxes or Taxes:Property or
Insurance:Automobile can be classified as associated with Automobile:Honda
CR-V, Property:123 Elm St., and Automobile:SLK 280.

One problem with Classification is that you have to hand enter it for every
Loan Payment entered from Scheduled Bills.

If classification sounds like something you might want to explore, see the
topic in help or post back.

"Kimberly Anderson" <KimberlyAnderson@discussions.microsoft.com> wrote in
message news:274EDEC4-B093-4F75-A917-575D4324D68A@microsoft.com...
> How then should I have set up my car loan situation so that I can report
> on
> it as a car expense?

Ok, so now I've realised that I shouldnt have used transfers to pay off my
loan account. I figure I should have 2 entries: 1 withdrawal from my bank
account, and 1 decrease on the loan account.

So, now, how do I change all my transfers to withdrawals????

thanks again.
Kimberly



"Bob Peel, MVP" wrote:

> A transfer as such doesn't have a category. What does have a category is the
> payment to the loan company.
>
> Effectively a transfer is simply moving money from your left pocket to your
> right pocket. It is still yours until you take it out of your right pocket
> (and pay it to the loan company).
>
> --
> Regards
> Bob Peel,
> Microsoft MVP - Money
>
> For UK tips & fixes see
> http://support.microsoft.com/default...d=fh;EN-GB;mny.
>
>
> I do not respond to any emails that I have not specifically asked for.
>
> "Kimberly Anderson" <KimberlyAnderson@discussions.microsoft.com> wrote in
> message news:71338B51-5702-4257-9706-428C8CB8CF5A@microsoft.com...
> > Hi all,
> >
> > I hope one of you experts can help me.
> >
> > I have a liability account for my car loan.
> > I have monthly transfers from my bank account to my car loan account.
> > I want these transactions to be categorised as a car expense so I can
> > report
> > on all car expenses. But I dont see a place to select a category with a
> > transfer transaction.
> >
> > Thanks for any help!
>
>

If you setup a Money Loan Account--a special type of Liability Account in
Money--you should use the special category of Loan Payment. Loan Payments
are unique in that they include at least two split components: an Interest
Expense component and a Principal Transfer component. The former is just an
expense categorized, the latter serves the Transfer function to reduce the
balance of the liability. The Loan Payment calculates the values of each of
these components based on the loan terms you taught Money when you setup the
Loan Account.

But, generally I disagree with you. If both your bank account and the loan
account are modeled in Money, Transfer (or the Principal Transfer component
of a Loan Payment) is a better choice than two disassociated transactions.

"Kimberly Anderson" <KimberlyAnderson@discussions.microsoft.com> wrote in
message news:EE22E2C8-1483-4DA5-8C8A-57ACD8210397@microsoft.com...
> Ok, so now I've realised that I shouldnt have used transfers to pay off my
> loan account. I figure I should have 2 entries: 1 withdrawal from my bank
> account, and 1 decrease on the loan account.
>
> So, now, how do I change all my transfers to withdrawals????

Hi Dick,

I definitely have transfers included for my report but but still dont see
them on my report.

I did try the classification idea too. Car expense: Loan. I selected it on
one of the transfers, selected it in the customisation for my report but
still no dice. It doesnt show up on the report.

I definitely want to track the balance of my loan so I want to have an
account for my loan.

See my other post, should I just have separate entries? If so, is there a
way to easily change my transfers to withdrawals? (I've wondered this before
about Money, if there is any way to run scripts on the data).

thanks again for your help.
cheers,
Kimberly




"Dick Watson" wrote:

> Well, you could report it in some reports by including transfers in the
> customization.
>
> The real key to understanding this is that your car expenses associated with
> this loan are a) the interest expense you are incurring for renting the
> money, and b) the original purchase cost which you incurred the day you
> bought the car. The principal Transfer component of the Loan Payments is
> just transferring money from one pocket--an asset account like a checking
> account, to another--a liability account.
>
> For this reason, some people who really want to view the payments as the
> expense just skip modeling the loan account in Money and treat the payments
> as some expense every month. I do not recommend this as it masks the true
> financial nature of what's going on.
>
> One other way is to "classify" the automobile-related movements of money.
> Classification is a parallel scheme to categorization and allows you to,
> say, note that the Principal Transfer is classified as Automobile:Acura TSX.
> Classification is handy because you can put it on, say, Automobile or
> Vacation or Property or whatever, related expenses that are not obvious.
> With classification, for example, Taxes:Sales Taxes or Taxes:Property or
> Insurance:Automobile can be classified as associated with Automobile:Honda
> CR-V, Property:123 Elm St., and Automobile:SLK 280.
>
> One problem with Classification is that you have to hand enter it for every
> Loan Payment entered from Scheduled Bills.
>
> If classification sounds like something you might want to explore, see the
> topic in help or post back.
>
> "Kimberly Anderson" <KimberlyAnderson@discussions.microsoft.com> wrote in
> message news:274EDEC4-B093-4F75-A917-575D4324D68A@microsoft.com...
> > How then should I have set up my car loan situation so that I can report
> > on
> > it as a car expense?
>
>
>

I agree 2 unlinked entries is silly.

I originally wanted to set it up as a loan account but I couldnt get my
payments to calculate correctly and this type of account seemed very
restrictive. I dont care to separate the interest from the priniciple
anyway. I would use 0%.

But, if I use the Loan Payment category, I cant categorise it under Car
Expenses can I?

I suppose I could try that type of account now. I doesnt look like I can
change my account now to loan account so I'll have to create a new account
and maybe transfer the entries?

thanks again.
Kimberly

"Dick Watson" wrote:

> If you setup a Money Loan Account--a special type of Liability Account in
> Money--you should use the special category of Loan Payment. Loan Payments
> are unique in that they include at least two split components: an Interest
> Expense component and a Principal Transfer component. The former is just an
> expense categorized, the latter serves the Transfer function to reduce the
> balance of the liability. The Loan Payment calculates the values of each of
> these components based on the loan terms you taught Money when you setup the
> Loan Account.
>
> But, generally I disagree with you. If both your bank account and the loan
> account are modeled in Money, Transfer (or the Principal Transfer component
> of a Loan Payment) is a better choice than two disassociated transactions.
>
> "Kimberly Anderson" <KimberlyAnderson@discussions.microsoft.com> wrote in
> message news:EE22E2C8-1483-4DA5-8C8A-57ACD8210397@microsoft.com...
> > Ok, so now I've realised that I shouldnt have used transfers to pay off my
> > loan account. I figure I should have 2 entries: 1 withdrawal from my bank
> > account, and 1 decrease on the loan account.
> >
> > So, now, how do I change all my transfers to withdrawals????
>
>
>