10 Things to do in Quicken before the end of the year

Time To Read 9 MIN READ

As the year winds down, there’s no better time to catch up on your finances. These 10 things to do in Quicken will help you bring your finances up to date, set the right budget, maximize your savings, get a head start on tax season, and start your 2021 finances off on the right foot.

1. Get up to date

Even if you usually keep your finances up to date, it’s easy to get behind from time to time, especially around the holidays. You might be heading into December with gaps in your Quicken data, but that’s okay. Now is the perfect time to get caught up. 

If you’ve downloaded your transactions within the last 3 months, then one update in Quicken is probably all you need. If it’s been longer than that, an automatic update might not be enough, depending on your financial institutions. If you end up with some missing data, check the website of your bank or brokerage. Many will let you download older transactions as a file you can then import into Quicken using:

  • File > File Import > Web Connect (.QFX) File (Quicken for Windows)
  • File > Import Bank or Brokerage file (.OFX, .QFX) (Quicken for Mac)

“I have enjoyed being able to go back and look up things. For example, how old is my refrigerator? I just search Quicken for the receipt.”—Barbara, Quicken Member

2. Reconcile your accounts

Once your transactions are up to date, it’s a good idea to reconcile your accounts to make sure your information is accurate. You can reconcile month by month using old statements, but it’s a lot easier to reconcile based on your online balances today to catch up all at once. 

If you do find discrepancies, you can track down the issues or just accept a balance adjustment and move on. Some people don’t mind a few differences as long as they aren’t very big. Others want to reconcile each individual transaction down to the penny. Quicken lets you handle it whichever way works best for you.

No matter how you reconcile your accounts, make sure you review your transactions’ categories, especially if you use Quicken’s reports to get ready for tax season. In that case, focus on tax-related transactions first to make sure they’re captured correctly. Then review any others you care about for spending reports, end-of-year comparison reports, budgeting, and so on.

“I review previous entries and make sure all are assigned to categories.”—marylpn, Quicken Member

3. Get ready for tax season

As you get ready for tax season, think about the information you might want to get from Quicken as opposed to what you’ll get from other sources. Things like W2s, K1s, mortgage interest, and capital gains reports will usually be mailed to you from your employer, partnerships, mortgage holder, and brokerages, for example, so you might not need to create those yourself. 

On the other hand, Quicken’s tax-schedule reports can be extremely helpful: Schedule-A personal expenses, Schedule-C small business expenses, Schedule-E rental income and expenses, and so on. Make sure the transactions related to these reports are listed in categories that map correctly to the IRS reporting requirements—like Quicken’s predefined “Tax Related” categories.

Once you’re all caught up and your transactions are categorized correctly, the best way to make tax season easy is to make Quicken a habit, taking just a few minutes each day to download and review your new transactions while they’re still fresh in your mind. Many Quicken members do this over their morning coffee, for example, or as part of their weekend routine. 

“Make and print reports in all tax categories.”—Shaxpur, Quicken Member

4. Run tax-related reports for your accountant

With your accounts up to date and your transactions properly categorized, you’re ready to run your tax reports. If you’re using Quicken’s predefined “Tax Related” categories, or if you’ve mapped tax-related line items to your own categories, you can use Quicken’s built-in Tax Schedule or Tax Summary report without any modifications.

In fact, using Quicken’s “Tax Related” categories or tax-mapping your own also lets you export data directly from Quicken into tax prep software like TurboTax. To learn how to tax-map your own categories in Quicken, read the FAQs about that for Mac or Windows.

If you don’t need to export directly into TurboTax and you’re using a system of your own, you can customize any Quicken report to include only the categories you need. Once you’ve set up your custom report, be sure to save it so you can use it again next year.

“I print out my tax deductible categories. Once I reconcile each account, I change to ‘This Year’ to clean up each register.”—Dominick T., Quicken Member

5. Run a net worth report 

One of the best things about Quicken is how easily you can track your net worth: the sum total of all your assets minus your liabilities. Quicken displays your current net worth at the bottom of your account list, but it’s the trend line of your net worth, not the number itself, that’s arguably the best measure of your overall financial position. 

The end of the year is a great time to take stock of your net worth. Start by making sure you’ve added all your accounts in Quicken: both your assets and your liabilities. For example, if you add your mortgage and forget to add the underlying value of your home as an asset, your net worth will look lower than it really is.

Your assets also include any savings accounts and investments you might own, including retirement accounts (401(k), SEP, IRA, etc.), savings bonds, mutual funds, partnerships, and so on. Quicken will track just about any publicly traded investments automatically, but you can also add your own private investments, from stamp collections to multi-family investment properties. Simply add a new asset account, name it, and enter its value to include it in your net worth calculation.

If you’re using Quicken for Windows and the idea of tracking all your investments feels a little overwhelming, try the new Simple Investing option. Simple Investing keeps track of your publicly traded holdings and current market value, so you can include your investments in your net worth without having to keep up with all your transaction details.

Once your accounts are all added to Quicken, run a net worth report to see how your net worth is trending. No matter what that picture shows you, information is power. If you’re not happy with the trend, you can use that information to adjust your budget for the coming year. 

“I also check my net worth at the start of 2021 which is the value of my asset accounts like cash, checking, savings, minus the liabilities like credit card outstanding balances.”—Barry G., Quicken Member

6. Review your budget 

The end of the year is the perfect time to review last year's budget and make any adjustments you need to make. Review your spending throughout the past year to see what you might want to change.

 This isn't necessarily about tightening your budget. Sometimes it's more about finding better ways to do the things you want to do. For example, you might want to spend less in one place so you can spend more somewhere else.

 If you want your net worth to grow more quickly, you can also use budget adjustments to find places where you can save money. Making several small changes to your monthly budget can really add up by the end of the year. 

If you’re not using Quicken budgets, you can still review your annual spending compared to the year before. Try running a spending comparison report by category, comparing 2020 to 2019. This provides a great overview of where your money is going and how things are changing year-over-year. You can also run a spending report by month to see your monthly spending trends throughout 2020—no budget required. 

“I look at the year’s cash flow report and go through the categories to see if my budget was similar to what I spent, then check up on our savings and budget.”—Purplemitch11, Quicken Member

7. Create special funds and plan ahead 

Your end-of-year wrap up is the perfect time to start planning for next year’s big expenses. Things like holiday funds, vacations, and even property taxes are opportunities to plan ahead, saving something each month toward those goals. The more money you can save up ahead of time, the less you’ll have to put on credit cards, which are notorious for high interest rates. It can also help you avoid suddenly tightening your belt when those big expenses come up.

At the same time, create a plan to build your emergency fund if you haven’t already. Ideally, you’ll want to have enough savings to afford 3 to 6 months’ worth of expenses, but you can build up to that over time. As you get started, even saving enough to cover things like surprise car repairs can keep you from having to put those on a credit card—or having to take out a personal loan.

“First, I backup my Quicken yearly data. Second, I set up a new budget based on Quicken yearly data. Last, I set new savings goals!”—Daniel L., Quicken Member

8. Review your recurring bills

Did you know the average American pays about $237 every month for subscription services? Fifteen dollars here and ten dollars there can really add up. Use Quicken Bill Manager to review your recurring bills and subscriptions to make sure you’re not spending money on things you don’t need or use anymore.

The end of the year is also a great time to add any bills you might not have added before, even bills that are handled by auto-pay. When all your recurring bills are in Quicken, you can use projected balances to make sure your accounts won’t drop below minimum balance levels or incur overdraft fees. At the same time, add your regular income as a recurring inflow so Quicken can help you project those balances accurately.

If you’re using Quicken Premier or Quicken Home & Business, you can even pay your bills from inside Quicken itself with just a few clicks. Be sure to set up Check Pay and Bill Pay to make managing and paying your bills easier than ever in 2021.

“Print reports on medical insurance, add a new year place for back ups & change income after getting a raise.”—Karen E., Quicken Member

9. Review your investments

If you use Quicken to track the tax implications of your investments and trades, be sure to use Complete Investing and make sure all your transactions are up to date and classified correctly. If they are, your realized gains and investing income, like dividends, will be included automatically in your tax-schedule reports. This is also a great time to take stock of your portfolio, making sure your allocations are hitting your targets.

If you don’t use Quicken to track tax implications and you don’t like getting into investing details like mutual fund holdings and allocations, consider trying Simple Investing for 2021 to get the bird’s-eye view you want without the information you don’t need.

“1) Run a report to see how money was spent over the last year compared to other years. 2) View investment performance to see if there needs to be any adjustments. 3) Forecast the next year's inflow and outgo.”—Johnny M., Quicken Member

10. Run through our end-of-year checklist

Finally, run through our year end financial checklist. Don’t miss these opportunities to make the most of your money, from tax withholding reviews to IRA contributions and deadlines.