Glad to read you are seeing a light. Maybe not the only light, but it is one
I've followed since '93 with Money. I also see in several of your other
threads that you've discovered the joys of Advanced Budget. It works but
does some apparently senseless things in certain contexts. The secret is to
characterize these behaviors and learn to adapt to them.

"ra" <rarun9[at]gmail.com> wrote in message
news:1194672074.193026.159930[at]z24g2000prh.googlegroups.com...
- quote -

On Nov 9, 4:35 am, "Dick Watson" <littlegreenge...[at]mind-enufalready-
spring.com> wrote:
- quote -

Dick, you will be happy to learn that I have been playing with the
Cash Flow Forecaster, and I am beginning to see believe that this is
the primary tool that one would use instead of envelope based
budgeting. I think this is what you were saying one should do - viz.
to leave the money fungible and monitor and forecast cash flow using
the facilities to model events and add one-time items. I am now seeing
the Advanced Budget along with the good monitoring of the Cash Flow
into the future as the alternative to my original approach.

"Dick Watson" <littlegreengecko[at]mind-enufalready-spring.com> wrote in
message news:OSbxL1sIIHA.5860[at]TK2MSFTNGP04.phx.gbl...
- quote -

When you understand its logic and bugs, and can live with them, the
Advanced Budget isn't bad, either.
--
Chris Cowles
Gainesville, FL

"ra" <rarun9[at]gmail.com> wrote in message
news:1194672864.743073.64910[at]i38g2000prf.googlegroups.com...
- quote -

Others make the effort to initiate and maintain pointless dialogues,
apparently as entertainment. By your statement, that seems not to be
the case for you.
--
Chris Cowles
Gainesville, FL

On Nov 9, 9:27 am, Cal Learner-- MVP <via_newsgr...[at]please.tnx> wrote:
- quote -

I see that I have got your mirror neurons firing.

On Nov 9, 11:03 am, "Brent" <undefined> wrote:
- quote -

Perhaps. For the record, and so there is no confusion - the answer to
his question - is "No". If I had, I would not be wasting my time
trying to solicit advice on the best ways to manage my personal
finances, and how to do it within Money. I wouldn't have wasted my
time trying out mvelopes, only to find out what a horribly inferior
overall product it is. I wouldn't have wasted my time pouring over
many internet sites to try and find ways of managing ones personal
finances that are better than my own rudimentary ideas. I wouldn't
have wasted my time trying to get the most out of Dick's apparent vast
experience in thinking about this.

Perhaps Chris is attempting to express in a diplomatic manner something
that others have heretofore resisted expressing in a less than
diplomatic manner.


"ra" <rarun9[at]gmail.com> wrote in message
news:1194586835.854752.226710[at]v23g2000prn.googlegroups.com...
- quote -

In microsoft.public.money, ra wrote:

- quote -

I don't fail to see the incongruity of your question.

Forecast Cash Flow and Lifetime Planner, to name two. The Tax Estimator does
a pretty reasonable job all things considered.

"ra" <rarun9[at]gmail.com> wrote in message
news:1194586835.854752.226710[at]v23g2000prn.googlegroups.com...
- quote -

- quote -

Chris, don't read this wrong, I am just curious - what are the
artifacts within Money that you find sophisticated? I ask not to
challenge, but to appreciate something that I might not be right now.


Have you already decided what software was most
- quote -

I am a long time user of Money - I remember one of my files being
called MyMoney-1997, so it must be close to 10 years now, though I
have intermittently not used it at all.

Are you insinuating something or trying to be helpful somehow with
your question? I fail to see the helpfulness of your question.

"ra" <rarun9[at]gmail.com> wrote in message
news:1193762773.536065.165840[at]i13g2000prf.googlegroups.com...
- quote -

Not true, for many users. It simply doesn't conform to a model you
seem attached to. Have you already decided what software was most
likely to suit your interests, before coming to this forum?
--
Chris Cowles
Gainesville, FL

ra <rarun9[at]gmail.com> wrote on 31 Oct 2007 in group
microsoft.public.money:

- quote -

If that works for you, then it works for me.

The root problem with not doing things the "Money Way" is that the
built-in features don't work right. You won't get correct results from
the net worth report, and anything that tries to look into the future
will be wrong because Money thinks your money in savings is double what
you have in reality. You MIGHT be able to work around some of these with
creative custom reports.

I thought of another technique you might like. You can create entries in
the "Class 1" and "Classification 2" fields for anything you like. You
use categories for the conventional sorting that your CPA wants to see
at tax time. Classifications are so you can find transactions another
way. For instance, you might have transactions associated with a rental
house -- income from rent, expenses for maintainence, taxes, etc. (You
definitely want the categories correct for taxes, because that's what
all the tax software looks at.) You can then put "Rent House" in one of
the Classification fields, for all types of transactions, then run a
report showing everything with "Rent House" -- kind of a checkbook
register about how your rent house is doing. You're only limited by your
imagination in creating custom reports.

--
Steve B.
New Life Home Improvement

Steve thank you for all your suggestions.

I am now rethinking whether I should go to the detail that I was
thinking about going to, and instead focus on the income > expenses
equation as Dick advises. Actually I think I used to do just that -
which is focus only on the income > expenses issue. But lately
numerous unplanned and imperetive expenses have kept hitting me. One
of the keys that Dick mentions is to get ahead of the game.
Unfortunately, I have fallen behind the game - I still don't have any
debt at all, but have been drawing down my cash reserve for so long
and by so much that I now need to take some action about it. I think
the combination of multiple competing needs for expenses coupled with
the fact that there are others involved in spending the money too
(wife) has made me consider earmarking expenses. Earmarking would make
it very demonstrable as to why a new unplanned expense cannot be
accomodated - it is trumped by other needs that have already been
commited to. The only way it can be accomodated is by giving up
something else.

I was looking into mvelopes.com - haven't signed up for their free
trial yet. They seem way too expensive.

I like the idea of having cash accounts. I think I might modify your
suggestion a bit if I use this. I might not create transfers. I might
just debit the account with fake transactions each month, so that it
does not upset the real account. Perhpas name the account to indicate
the savings account that it is earmarking. At any given point in time
the sum of these savings cash accounts should add up to what I have in
the real savings account.

On Oct 30, 8:45 pm, "Dick Watson" <littlegreenge...[at]mind-enufalready-
spring.com> wrote:
- quote -

Dick, many many thanks for taking the time and effort to detail your
thoughts. Your better judgement was wrong. What you have laid out
below are extremely valueable insights into how one might think about
this.

This post of yours will live here for numerous people to read and
learn from. Your maverick and unconventional thoughts are what make
these groups and the internet such a great place. Thank you for
sharing your thoughts.

I am now trying to think about my approach over again. You have helped
me advance my thinking about this whole thing considerably, as you
will likely have for numerous other people.

There is no better payment than knowing that you are appreciated by
another human being for what you say and do. This is the one thing
that we all seem to really be running after. Know that you are.

Thanks.

On Oct 30, 11:45?pm, "Dick Watson" <littlegreenge...[at]mind-enufalready-
spring.com> wrote:
- quote -

Dick,
I just wish I had the gift of words you do. I apply my
financial management thinking like you do and it has worked well for
me. Thanks for your continuing comments.
Steve

<money_user_to_user_supportAgainst my better judgment, comments inline, original pruned.

"ra" <rarun9[at]gmail.com> wrote in message
news:1193778251.906682.205680[at]q3g2000prf.googlegroups.com...
- quote -

I was with you 100% until you said the "many" real accounts part. Quicken
calls (all but the "many" part) these sub-accounts. If it's "many" then it
is hard to imagine how this would work and ever support any notion of
traceability to REAL MONEY in REAL ACCOUNTS. Money is 100% fungible. If I
have, say, three real world accounts that have each deposited $100 into my
virtual cookie jar account, how do I tell the balance of the real world
accounts? I mean I can obviously see ways to do it from a database point of
view. But why even go there?

- quote -

I'm not sure the BI guys have ever talked to the accounting guys. BI guys
deal in all kinds of dreamy virtuality. Accounting deals in reality. Money
tends towards the accounting view. At any rate, Money is what it is and your
virtual accounts thing isn't it. Please don't read me wrong: I'm not saying
I don't understand your view of what would be nice nor why many people think
it would be nice. I just don't think it changes the underlying problem,
indeed, it distracts from it.

- quote -

Seems like it would just allow you to confuse what was really going on, but
that's back full circle to my basic objection to cookie jar methods vs.
formalized accounting methods.

- quote -

Indeed, I thought you had mistyped twice. The problem with your virtual
relationship is that money isn't virtual. Generations of accountants have
developed methods that consider money as only one place in the following:
+assets+income-expenses-liabilities. I think these methods work and they
don't need any virtual anything. Some people can't get with this program.
OK.

- quote -

</money_user_to_user_support<financial_advice_counse ling
Money is fungible.

- quote -

Better make sure that in the next year your income - all your other expenses
- quote -

Why worry it each month? Make sure that in the next year your income - all
your other expenses > = $3,000. Simple math already tells me you are in
trouble since $3k [at] $100 per month is 30 months. Granted it was just an
example, but maybe you see the underlying point. If I assume vacation is
going to be $3k/year, I'd better make sure that my income less my other
expenses > = $3k. If that's true, then there's no doubt now or ever that I
can AFFORD the $3k and the only detail left is the cash flow mechanics to
make it happen. It doesn't BECOME AFFORDABLE BECAUSE you've put $3k aside in
your cookie jar. It IS AFFORDABLE the minute your income - all your other
expenses > = $3,000. Indeed, one reservation I have with cookie jar
accounting is that it encourages the "but I can't be overdrawn, I still have
checks in my checkbook" way of looking at the problem. "I can afford X
because X costs $2,000 and I have $2,000 sitting in the bank." You can
AFFORD X because your income less all of the other expenses you will incur
is > what X costs.

- quote -

If you buy the one I just bought, you're 21.5 months out.

- quote -

To my way of thinking--and YMMV--the secret is not determining if/when you
will have enough money put away for X. The secret is if income-expenses is the cost of X. Granted, if you are starting out behind the eight ball, job
#1 is getting ahead of the eight ball. By this I mean you have to get to the
point where income has been greater than expenses long enough that you have
a cash cushion in your corner to tolerate short term events that put
expenses > income over short stretches. As long as income> expenses over the
long haul, short term periods where income<expenses can be weathered and the
whole notion of "have I saved enough for X" can be replaced with the notion
of "can I afford X" and, it the answer is yes, you are done and the only
hurdle is having sufficient cash flow to enable you keep from incurring
extra expense--renting money from someone--just to get the gratification of
having X now.

- quote -

No. Not in the sense that the most worthless expense that can be eliminated
by the practice is the expense of renting money from someone to have now
what you can't afford now. In the sense that you think it implies envelope
accounting, maybe it's not how I look at the problem. But if it works for
you...

- quote -

I DON'T accumulate specific amounts for specific purposes. (Except on very
rare occasions when I know an expense is coming like buying a car in, say,
two years +/- from now. Even then I don't try to or feel the need to somehow
"mark" the money.) I spend within some general guideline planned such that
if I spend so much a year on X, I will be OK because I **know** that all of
the amounts planned for expenses in a given year, including expenses for X,
add up to less than planned income. If I suddenly have to spend more on X or
have unplanned expense Y or some lower amount of income, I don't need to
look in my cookie jars to know I have to rethink how much is available for
remaining A-Z and how much my savings rate will need to be modified or,
worst case, how much I will have to draw down the cash reserve.

Again, the #1 secret is to get ahead of the ball once and stay more or less
there. And the more or less there corresponds to your personal cash cushion
that shrinks and expands according to cash flow but over time __will
demonstrably grow__ since you operate with income> expenses over time. (Think
calculus and the functions of income and expenses over time. The derivatives
at any given point may put income < expenses. The integrals have to maintain
income > = expenses.)

Don't get me wrong, I've been at this more or less since 1980 when I did
budgeting and cash flow forecasting on an HP41C calculator with one magnetic
card per pay period. and rolling accumulations from card to card. I do not
consult my AdvBudget in Money but once or twice a year. I almost never look
at the variance reports or the variance FYIs. I don't generally need to
because I've been in the habit and doing it for long enough that I have a
pretty well developed personal financial autopilot by now. If I encounter an
unplanned expense, I have a pretty good sense for what will have to give to
make it all work. But that's because of practice and having made the effort
over time to get ahead of the ball.

The secret to doing that is maintaining Income> Expenses. Maintain that
aggregate position for long enough and the rest will take care of itself.
And to my way of thinking, the only real way to do that is to:

a) know what your income is and your expenses are--account for them somehow
like transactions recorded in Money so you can KNOW not just guess or not
just have to resort to indirect means like looking in your wallet or your
bank account balances or your cookie jars to try to SENSE indirectly what
your income and expenses might have been recently. Money is GREAT for this
IF you invest the effort to collect good data. (One of the reasons I am not
a fan of downloaded transaction data is that it makes it much too easy to
collect bad and/or incomplete data. But that's a whole other set of threads
wherein I spout my maverick and non-conformist opinions and p*ss others off
who disagree with me.)

b) have a plan for what they CAN be--i.e., what is possible satisfying
income> expenses over time--going forward. Money's tools are OK for this but
everybody wants them to work differently than they do. You can do this on
the back of an envelope or in Excel or whatever. It really doesn't matter
how you do it. What matters is that you not try to fudge reality. Develop
the most realistic plan you can. There are lots of concepts about how to do
this and things like budget groups in Money and understanding discretionary
and non-discretionary expenses and so forth. All just tools to an end.

and c) verify you are performing to that plan or adjust the plan so that it
continues to satisfy income> expenses over time and you can perform to it.
I.e., compare the accumulating actuals data from step a) to the plan from
step b).

- quote -

There is no one right answer. I've given you mine, several times now. What
works for you is what's right for you. My approach is that and only that. It
works for me.

- quote -

Maintain Income > Expenses over time. Done.

</financial_advice_counseling
<editorial_commentSome people get paid big money to sprout pretend brilliance like the
above... Some people even get paid to write it. Some people who write it get
entire Money budget models designed in their honor. Go figure.
</editorial_comment
<legal_stuff(c) 2007 Dick Watson. All rights reserved. No warranty implied or offered.
YMMV. Etc.
</legal_stuff

ra <rarun9[at]gmail.com> wrote on 30 Oct 2007 in group
microsoft.public.money:

- quote -

I've been following this thread with interest. I applaud you for your
efforts in budgeting.

What you want to accomplish just isn't a function that Money supports.
Money assumes one account in the database matches one account in real
life. This is from the accounting view of the world.

Here are a few ideas:

· Set up your "real" savings account to sync with the bank. Set up
"fake" cash accounts, one for each goal toward which you're saving. Use
a transfer transaction to move money from the "real" account to the
"fake" accounts as you want. The downside of this method is that your
"real" account balance doesn't match reality. Some summary screens will
not make sense.

· Use split transactions and customized subcategories for each savings
goal. When you put $1000 in your savings account, make the deposit a
split transaction that totals to $1000. Each split could have a
subcategory to match a goal. Set up a custom report that shows your
savings account by subcategory. The downside of this method is that you
have to run a report, but your account balances make sense on standard
reports and summary screens. Your accountant will like this one.

· Set up separate accounts at your bank for each goal. This makes
everyone happy but your wallet, since the bank will charge you for each
account. On the other hand, it might be worth it to you to pay for peace
of mind.

· Keep a spreadsheet outside of Money to track your goals. This one
makes absolutely everyone happy, except maybe you since you want only
one place to keep your records. This is the one I would pick.

I've never seen any personal accounting system that does exactly what
you want. I haven't used Quicken for years, but that's the only other
low-level commercial product on the market, and I don't think it has
this functionality.

You might look at some of the open-source packages. They're developed by
people dissatisfied with the commercial products, so they might have
features you would like.

Finally, you could consider a high-level package designed for business.
They're completely customizable to meet the needs of businesses because
every business is slightly different. Unfortunately, you HAVE to
customize the package, with help from your accountant, because the way
it comes out of the box is so generic it's not acceptable for ANYONE.
I've overseen the installation of some of these packages for smallish
businesses, and the budgets are always at least six figures. Doing this
for an individual would be lots cheaper, but you're still talking about
hundreds of hours of your own time and maybe just as much from your
accountant.

I'll keep watching this thread. I'm interested to see what you decide to
do.

--
Steve B.
New Life Home Improvement

On Oct 30, 2:07 pm, ra <rar...[at]gmail.com> wrote:
- quote -

As I think about this some more, I think what I am looking for is the
capability to earmark savings for particular expenses. This way when a
new unforseen expense comes along I will have the ability to look at
how much of my savings is already earmarked and not available.
Alternatively I can consciously choose to use money earmarked for some
other purpose for a more urgent need. So I guess I am looking for
detailed savings management capabilities - categorization, tracking,
changing etc.

- quote -


Steve, thanks for the ideas. I hope my reply above to Dick provides
some insight into what I am hoping to do. I am intrigued by your
comment on not sweating the details. I will try to reevaluate if I am
trying to control too much and am on the wrong track of getting too
detailed.

Dick, thanks for the response. You are obviously contributing
tremendously, and that is most appreciated.

This blurb below from you is kind of what I was looking for - to see
if my way of thinking could be better. This paragraph below is very
useful to me to mull over and ask myself if that is what I am
intending to do, and clarify for myself what it is that I am intending
to do, and it is even the right thing.

- quote -


- quote -

A virtual account would be the notion of an account that lives within
the PFM software and is not tied to a particular bank account. Instead
it could have a relationship to many "real" bank accounts. This way
the bank accounts are simply physical repositories of the money.
Monies are in physically different locations only because the physical
location provides some facility - interest rates/bill payment etc.
Having a virtual account could cut accross these boundaries of
physical location of the money. Instead of thinking about my money in
separate bank accounts, I can think about them using a different
dimension. I can think about a virtual savings account for Home
Purchase that is related to many physical accounts - some investement
accounts, some savings bank accounts. When I make a deposit into a
virtual account - it would be real money going into one of the
physical accounts that underlie this virtual account. But the fact
that I have made a deopsit into my home savings account is a
significant event that can be captured within the notion of this
virtual account.

The concepts that I am proposing here come from Entity Relationship
theory, and also from Business Intelligence. BI is ability to look at
underlying data using various flexible dimensions. There are
significant advantages to doing so.


- quote -

I think I have explained above what I meant by virtual account. The
part where you talk about the problem with balancing it is exactly the
problem! If it were possible, it would be quite a powerful capability.


- quote -

If you read carefully, I didn't say virtual money, I said virtual
mAny. Entity Relationships can be one-to-one, one-to-many, many-to-
one, or many-to-many (the concepts used in relational databases and
relational theory). My statement was confusing; somewhat clearer
wording would be: MS Money is missing the ability to support the
notion many-to-many relationships between virtual accounts and real
accounts (bank/cash/investment etc.).

- quote -

Thank you for the GnuCash suggestion, I will look into it.

I believe that I have been lacking in laying out specifically what my
need is. My need is not to use envelope based budgeting. That is just
the very first idea that came to my mind as a solution to my problem.
Given that it is the first idea, it is also very unlikely to be the
best idea. Hence my post on this group, looking for advice and
alternative viewpoints.

My basic need is this:

I have realized that I am overspending. While I have already set up an
advanced budget and am now planning on monitoring it closely, I am
still lacking an ability to putaway money for specific purposes and
know that when I need it the money is there for that purpose. Eg. I
might need to take a trip that will cost about $3000 one year from
now. So I decide to start putting away $100 a month in preparation for
that into a savings account - say an account with Emigrant.
Additionally I might have other such long term expenses that I
anticipate, eg. I start putting away $200 a month toward buying a
plasma TV. I put it into the same savings account at Emigrant. I could
easily conceive of about 10 such long term expenses that I need to put
money away for. At any given point in time how can I deduce from
looking at my Emigrant account balance what I have put money away for
and whether I have accumulated enough to spend? More importantly what
if I don't have to take that trip. How can I now spread out my
accumulation to other planned expenses so that they may be achieved
sooner - buy the plasma TV sooner for instance. Alternatively, I might
want to choose to reallocate funds saved up for a plasma TV to
spending it on medical needs that are somewhat discretionary.

Am I wrong in trying to move to an accumulate before spending model.
You seem to agree that it is a good model since you have been using
it. But then, how do you manage to monitor and make changes to the
accumulation with changing needs?

Is the fact that I am thinking about allocating and accumulating for
specific purposes the wrong thing to do here? We certainly all do it
for large things such as buying a home. But what about a number of
smaller and nearer term things?