Meaning of reconciled transaction
Giorgio Valoti
I’m trying to understand reconciled transaction. The procedure is
simple and clear but I can’t *why* should I use it. I mean: every
month I receive the bank and the credit card reports and I simply
input them. Should I consider these transactions already reconciled?
Thank you in advance
--
Giorgio Valoti
Simon Wolf
>
> Hi all,
> I’m trying to understand reconciled transaction. The procedure is
> simple and clear but I can’t *why* should I use it. I mean: every
> month I receive the bank and the credit card reports and I simply
> input them. Should I consider these transactions already reconciled?
Yes, if they're straight off your bank statement they're reconciled.
I'd imagine that most people enter transactions as and when they occur
and then when their bank statement arrives they compare it to the
records in MoneyWell and this process is the traditional
reconciliation process.
Simon
Kevin Hoctor
> I’m trying to understand reconciled transaction. The procedure is
> simple and clear but I can’t *why* should I use it. I mean: every
> month I receive the bank and the credit card reports and I simply
> input them. Should I consider these transactions already reconciled?
Giorgio,
If you are entering all your transactions from your bank statement,
then the only reason to reconcile is to make sure you didn't miss one
(or mistype one).
The process is a verification that what the bank shows as your current
balance is the same as what your personal records show. I use a direct
connect for most of my transaction entries but occasionally I'll enter
big purchases, debits, or credits at the time of the transaction so I
know approximately how much is left in my buckets. There are also
recurring transactions that need to be verified. Without reconciling,
I wouldn't know if all these were correct.
Additionally, I noticed last week that a rather large tax check was
never deposited only because I reconcile my account. Now that I know
that is still open, I can investigate and track it. If I hadn't put
that check into my register manually and then reconciled, I could have
thought I had much more in my account than I had and spent it before
the check cleared. I recommend at least entering checks when you write
them just for this reason.
Peace,
Kevin Hoctor
ke...@nothirst.com
No Thirst Software LLC
http://nothirst.com
http://kevinhoctor.blogspot.com
Bill Nalen
On Nov 10, 2008, at 9:28 AM, Kevin Hoctor wrote:
>> I’m trying to understand reconciled transaction. The procedure is
>> simple and clear but I can’t *why* should I use it. I mean: every
>> month I receive the bank and the credit card reports and I simply
>> input them. Should I consider these transactions already reconciled?
>
I don't plan on using the reconcile feature. I enter transactions as
they occur and once in a while check that my MoneyWell checking
account balance = my bank's web site balance (adjusted for the few
outstanding checks that haven't cleared). At my bank I turned off
paper statements so I don't ever look at another bank statement. My
method produces the same results, i.e. does my local balance = what
the bank thinks my balance is. I try to eliminate as many procedures
as I can without losing any benefits.
Thanks
Bill
Simon Wolf
What I've started doing is using the reconciliation flag to mark off
transactions when I check them against my on-line banking records. I
know that this by-passes the actual reconciliation feature but it does
allow me to know where I'm up to. I only really mention it because I
think that someone asked about flagging transactions they had checked
on-line a few days ago.
Simon
Patrick Burleson
> I don't plan on using the reconcile feature. I enter transactions as
> they occur and once in a while check that my MoneyWell checking
> account balance = my bank's web site balance (adjusted for the few
> outstanding checks that haven't cleared). At my bank I turned off
> paper statements so I don't ever look at another bank statement. My
> method produces the same results, i.e. does my local balance = what
> the bank thinks my balance is. I try to eliminate as many procedures
> as I can without losing any benefits.
I'd caution that this method can give you a false sense of your
balance. I watch my accounts like a hawk and I've been balanced to the
penny since sometime in 2000. I got this way because I was using the
"fudge" method of account balance where I knew the bank and I were
"close enough". That is, until I got a little low and started bouncing
things. Now, I balance with my online bank website about once every
other week.
The things I've found while doing this are pretty amazing:
Transactions using my debit card that never clear (happens at least once a year)
Checks cashed for the wrong amount ( had a car payment underpaid by $60 )
Meals where I was charged an entire meal where most others paid cash (
the waiter pocketed the cash and charged it all to me )
I know lots of people don't balance to the penny so there's some
"fudge" in the numbers, but I find that I really like knowing my exact
balance and trace differences to specific transactions.
Just my $.02
Patrick
Patrick Burleson
>
> What I've started doing is using the reconciliation flag to mark off
> transactions when I check them against my on-line banking records. I
> know that this by-passes the actual reconciliation feature but it does
> allow me to know where I'm up to. I only really mention it because I
> think that someone asked about flagging transactions they had checked
> on-line a few days ago.
>
I don't use the actual reconciliation feature either, I just use the
"reconciled" flag. And with the "reconciled" balance at the bottom, it
makes checking my balance with bank a snap.
Patrick
Bill Nalen
On Nov 10, 2008, at 10:05 AM, Patrick Burleson wrote:
> I'd caution that this method can give you a false sense of your
> balance. I watch my accounts like a hawk and I've been balanced to the
> penny since sometime in 2000. I got this way because I was using the
Yeah, I just meant that I "reconcile" to the balance on the web site
ad hoc vs. doing the monthly reconcile to the paper statement that
used to come. As long as I can reconcile between the bank's web site
and my MoneyWell account balance nothing can get lost.
Thanks
Bill
Greg
transactions.
Importing credit card and bank statements makes sense and is an easy
way to upload this information and just put it into buckets. What is
difficult for me is keeping track of cash transactions. Say I have
$40 and spend $27.25 - does this come out of my bank account? If so,
it is off and not reconciled with my statement. Do I have to have a
separate 'cash' account and keep track of what is in my wallet at all
times??? (it changes often :S and I'm worried that it will be a lot of
work to keep track of what is in my wallet)
How do other users do it? Do you reconcile your bank statements AND
what is in your wallet - treating your wallet as a separate 'bank
account'?
Some tips would be appreciated...
Thanks,
G.
PS. Quick question. When I'm importing bank statements, it always
seems to create a new account rather than go into the one I want it
to? How do I merge bank accounts again?
Kevin Hoctor
> One trouble I'm having with moneywell is keeping track of cash
> transactions.
>
> Importing credit card and bank statements makes sense and is an easy
> way to upload this information and just put it into buckets. What is
> difficult for me is keeping track of cash transactions. Say I have
> $40 and spend $27.25 - does this come out of my bank account? If so,
> it is off and not reconciled with my statement. Do I have to have a
> separate 'cash' account and keep track of what is in my wallet at all
> times??? (it changes often :S and I'm worried that it will be a lot of
> work to keep track of what is in my wallet)
>
Hi Greg,
Yes, you should have a "Cash" account and you should use the "Cash
only" checkbox on the Transaction Detail or the "C" checkbox on the
split transaction table for splits.
> How do other users do it? Do you reconcile your bank statements AND
> what is in your wallet - treating your wallet as a separate 'bank
> account'?
>
> Some tips would be appreciated...
When you withdraw cash, mark that transaction as cash only and let
MoneyWell transfer that ATM transaction to the cash account. Then you
can create all your cash transactions in that separate account. This
let's you directly manage your pocket cash without messing up your
check register.
Split transactions have the same functionality so you can manage your
cash back from purchases.
Bill Nalen
On Nov 10, 2008, at 1:31 PM, Kevin Hoctor wrote:
> Yes, you should have a "Cash" account and you should use the "Cash
> only" checkbox on the Transaction Detail or the "C" checkbox on the
> split transaction table for splits.
Or do what I do and never carry cash. I use the debit card for
everything and then I have a trail from a single account :-)
Bill
Giorgio Valoti
On 10/nov/08, at 17:18, Giorgio Valoti wrote:
>
> Hi all,
> I’m trying to understand reconciled transaction. The procedure is
> simple and clear but I can’t *why* should I use it. I mean: every
> month I receive the bank and the credit card reports and I simply
> input them. Should I consider these transactions already reconciled?
(Many, many good advices)
Thank you all, this group is awesome.
Ciao
--
Giorgio Valoti
David Wu
whenever i make an atm withdrawal, i transfer from checking to cash
(which is what clicking the cash only checkbox does).
when i'm out and about, i do my best to record (in my iphone's notes
app) all my cash transactions and enter them in later. to help reduce
the note taking, i try to use my debit card instead of cash, as bill
suggests.
the important thing is not to let your cash transactions become a
black hole in terms of where you're spending your money.
-david
Kevin Hoctor
> when i'm out and about, i do my best to record (in my iphone's notes
> app) all my cash transactions and enter them in later. to help reduce
> the note taking, i try to use my debit card instead of cash, as bill
> suggests.
>
And this is why we are writing MoneyWell Mobile. ;)
> the important thing is not to let your cash transactions become a
> black hole in terms of where you're spending your money.
So true. It's very easy to let the cash in pocket add up to unknown
spending. I'd like to avoid using cash but I have three teenagers
—'nuff said.