Quicken Budgeting Tutorial

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Quicken does a lot. That's partly how it's remained one of the most popular financial software tools for decades. But all the features be overwhelming to newcomers, and even regular users can feel like they aren't using Quicken to its full potential.

It's helpful to become familiar with one of the most helpful aspects of Quicken: budgeting.

Get Started by Creating a Budget

Even though the software can be a little daunting when you first open it up, don't be afraid to dive into the deep end and just try setting a budget. It's a pretty straight-forward process, and you can always go back and change aspects of it (or start over completely). Window users can find the tool by going into the "Planning" section of the software, then click "Get Started" under "Create a Budget." Mac users have a "Budgets" tab, so simply open that up and click "Get Started."

The next step is to name your budget and set a time frame. Most people find it easiest to run budgets from January through December of a calendar year, but you can adjust that to fit any unusual fiscal cycles. Mac users choose a time frame in the primary dialogue box that creates a budget, but Windows users will have to go into the "Advanced Budget Settings" drop-down menu on the budget naming box.

That's all there is to creating a budget! From there you can customize to your heart's content.

Making the Most of Quicken's Automatic Budget

Quicken automatically pulls from your past year or so of financial activity to create a basic budget for you. It tracks spending amounts and highlights categories based on its best guesses for how the money was spent. It also pulls income information and compares that to your spending habits to create a rough outline for a budget.

The budget at this point should be fairly useful for basic budgeting needs. However, customizing categories and spending amounts will give you a better sense of how to use the software and ensure that you're getting all the benefits it has to offer.

Windows users can customize these options by clicking on "Select Categories to Budget." That menu will let you check and uncheck boxes to reflect your desired budget categories. Click "OK" to save the changes. The exact budgeting amounts for each category can be altered directly from the main view—just click into the field and change the number as you see fit.

The customization process for Mac users is nearly identical. Choose your categories by clicking on "Select Categories," then change the spending amounts in the main view.

Understanding the Color Coding

While you're in "Graph View," categories will be accompanied by bars of various colors. Understanding these colors will allow you to get an overall sense of your financial progress with just a glance.

In short, green means you're sticking to your budget, and red means you've slipped up, but you can glean more than that from the color bars. Grey bars, for example, indicate a lack of activity. It means you either haven't made any money or spent any money in that area (depending on whether it's an expense or income category).

The color bar next to categories can also contain light green or light red segments. These colors indicate the expectation of an expense or income. You can use these warnings to prepare for bill payments or plan upcoming expenses to fit around your paydays.

Rollover Budget Goals to Fit Fluctuating Finances

Budget categories default to rigid amounts that reset every month, but you can change that by enabling rollover categories. For example, if you set your gas budget at $50, but you only spend $40 one month, a default budget will still set the next month's budgeted amount at $50. A rollover category, however, will account for the $10 you saved in the previous month, and instead budget for $60 in gas.

To set a rollover category, select the desired category then look for the rollover icon. The default should look like two gray arrows crossing as they extend to the right. That icon indicates that rollover budgeting is off. To turn it on, simply click it, then select whether you want to roll over all amounts or only positive balances left in the category at the end of the month. The two options have slightly different icons, but both will turn the arrows green instead of gray.

Using Quicken Category Groups

While having a detailed breakdown of your spending is certainly helpful, you may also benefit from setting up category groups to simplify your display.

For instance, you may not need to know exactly how much you spent on gas versus insurance payments versus car loan payments. You could instead set up an "Auto" category group that tracks these related expenses in a simplified group. This makes it easier to quickly take stock of your financial progress without getting deep into the weeds of your finances.

To set up a category group for Mac or Windows, you must first open up the tools menu. From there, select options, then select "Assign Category Groups." This will open up a menu where you can create a new category group or edit one you have already created.