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Multiple Accounts Investment Portfolio for Dummies

Setting up an AceMoney File for Current Values
(Gain/Loss, Account Values, and Total Portfolio Current Value)

Written by an Accounting Dummy for Fellow Accounting Dummies

I like AceMoney. It's light (not bloated with the annoying bells and whistles of the other invasive program I'm replacing), has the necessary features, downloads current prices, and is more flexible for my purposes. I can easily enter and revise data my own way - which alleviates the fear I had of having to actually learn accounting skills. We all get statements from our accounts which have the right boxes with the right information for the IRS, as well as detailed information on interest and dividends, so my purpose with AceMoney is to be able to look at investments, gains/losses, and current values as they move up and down. After spending lots of time bumbling around figuring out how to set up my file, here's how I would do it if I had to start doing it all over again:

1. OPEN AceMoney, save, and set up a file for your investments.

2. Set up a password if you like (Tools, options, passwords) The file is unencrypted, so your choice is to use an encryption program, OR (my choice), make sure you have a good firewall, keep updated virus/bug detection programs, and don't include bank/investment account numbers when setting up each account.

3. SET UP ACCOUNTS: ("new account" on left pane) Type in the account name and select the account type (mine are mostly investment accounts). If you have more than one investment account, setting up all of them at this point works quite well. (for example: "taxable account", "ira", "roth", etc.) All of the accounts you have set up will now show up on your home/accounts page.

Advance warning: Don't download prices until the following processes have been completed unless you want to do some math. What you want is your total Cost Basis (cost of securities) and once AceMoney downloads price information it will provide you with gain/loss data which changes your cost basis.

Also: Multiple investment accounts will all show up on the same page when viewing gain/loss data. The means AceMoney uses to view the gain/loss information is in a common portfolio which mixes all of the securities in your investment accounts together. I created a system to identify which account each security belongs to by entering in each security name in LARGE CAPS followed by a dash, then using small caps to enter in the account they belong to (like "main", "ira", "roth", etc.) I put this information here so if you do have multiple accounts you can save some revision work when you enter your securities information on the next steps. There are some real positives in being able to view your entire portfolio on one page, especially when you've purchased the same securities in different accounts.

4. ENTERING SECURITIES: Under "accounts" which now appear on the main/accounts pages, click on the account you want to add securities to. The first page (untitled in the software) will be the account page or account registry where money goes in and out (balance sheet). But first you need to enter the names/symbols of your securities. Click the "portfolio" icon above. Now you're ready to go to "Add Investment" on the left pane and the new investment will be there for you to fill in. All you need is the name of the security and the symbol. Repeat this process for all of the securities you want to add to this account. (I tried to import the qif files from my previous financial bloatware program, but I think the "garbage out - garbage in" rule applied in my case.) Anyway, it doesn't take that long to enter or re-enter your data and it's probably good brain exercise.

5. ENTER SECURITIES DATA: All of your securities in the account you've set up are currently listed without any shares data on the account page/registry (first page after you select the account), thus you see lots of zeros. Select a security you've entered in the right pane and then hit the "New transaction" button on the left (or easier, double click on the security). Your security's data is now ready to enter. First, be sure to select the account they belong to. Then you're going to enter the date the security was purchased at the top left, then select "buy" as the action, then enter the Number of shares currently owned under "number of shares". Make sure the price is set at zero. Then enter the commission costs and Total cost of shares purchased. Notice that the cost per share price is automatically calculated so you didn't have to fill it in Then hit okay. (It's your choice whether or not to add commission costs, but in taxable accounts that amount isn't included as part of your reporting information when you sell.)

Continue the process of entering security data until all securities in the account have been filled in. Check again to make sure they are all located in the correct account. If some aren't, change the location by double clicking on it in the investment tab under portfolio and select where they belong under the "Account" option.

NOTE: (taxable accounts only) All the IRS wants is the original cost (excluding commission), date of purchase, and sell price (not number of shares) of securities in taxable accounts, so your data should be accurate for that purpose. My purpose in using AceMoney in this instance is to have the information I need handy when I report sales to the IRS so I don't have to look it up. Under "COMMENTS", when filling in your security's data in taxable accounts, it's helpful to repeat the information you'll need for the IRS. Then if you sell the security you can keep it listed but can delete its shares until you've reported the sale. Most statements now have documentation provided for sales of securities purchased in the past few years, but older stocks may not have been documented by your broker, thus will lack the information you need for reporting the sale. Setting up your account with IRS required information now will help eliminate compound headaches when trying to look up and fill in missing information during tax season.

6. BALANCING TO GET CURRENT VALUE: Go to Accounts, select the account with the securities you've just entered, and on this page (account page/registry) in the lower right pane you'll see a number which is the COST BASIS (total original costs of the investments in that account) which will be shown as a negative balance for all of those securities you've actually paid for. You need to add back this amount to enable viewing your current account value, so make a deposit in that same amount to your account. Select New transaction from the left pane, select Deposit, select the Account you want the funds in, make the Payee: "COST BASIS (NAME OF ACCOUNT)" and enter the same amount shown as the negative balance on the lower right of the page as a positive deposit. Your balance should now be zero, and your current actual account value (AFTER you download current prices) will give you your gains and losses, and will show the current value of the account on the main/accounts pages.

For those who need to backtrack (as I did): If you have already downloaded price information before making the COST BASIS deposit, you have two numbers, gain/loss balanced with the now changed cost basis. With a loss, add the two negative numbers to find your cost basis deposit. With a gain, subtract the gain number from the negative number to find your cost basis. What you want is a zero on the bottom right of your account registry, so do whatever math it takes to get there. (Also, If you got even more ahead of this dummy-written tutorial and already made cash deposits to that account, the total of that deposit amount has to be matched in the lower right corner - no more, no less) And if you've bought or sold stock since setting up your portfolio, see number 8.

7. Add any cash from your investment account by going to the first page after you hit the account button (account page/registry) Hit the "New transaction" button and make a deposit to that account making the payee "CASH - (ACCOUNT NAME)" From that point on you can select "Edit transaction" to change the amount to reflect your changing reality. The amount of deposit/s will now be shown as a positive number in the lower right corner of the balance sheet - and should match the sum of that/those deposits, no more, no less.

8. Updating cost basis when you buy/sell: If I've sold or added a security, I need to take care of it immediately before I forget I've done it. (and I will forget!) Go to that account's account registry. In selling, subtract the COST BASIS (not the sell price) of that security from that account's COST BASIS deposit. In adding securities, add the new COST BASIS amount to that account's COST BASIS deposit.

9. DOWNLOADING PRICES: Prices can be downloaded from Portfolio view, and each security can be set to download from any of the following sources: AMFI India, Google Finance, India Times, Money Central, MSN Money UK, Russian Trade System, Yahoo Finance, Yahoo Finance YK, and Zagreb Stock Exchange.

CHANGING PRICE DOWNLOAD SOURCE

First make sure the symbol for your security is correct. (I discovered I had a couple of incorrect symbols on some of my securities when I first loaded data so Yahoo Finance, for example, gave me enough options when I typed in the name of the security to find the right symbol which matched the prices I'm getting on my statements or on my online brokerage account. Why the old symbol works for the broker but not in the real world remains a mystery, but probably is due to some internal link in the brokerage site which leads to the updated symbol. If a security still isn't being updated and you're sure you have the correct symbol, you can change the price download data source. First go to "portfolio" view and then go to the "investments" tab. Double click on the security, and select another source on the "Data source" option in the dialog box. Sometimes some securities don't download on the first try, but will pop in during a later attempt using the same source (I have no idea why).

OTHER SHODDY ACCOUNTING BY-PASSES FOR DUMMIES

I enter MUNICIPAL BONDS on the balance sheet of a separate investment account rather than in the account they are held mainly because I don't want the headache of entering them as the bonds they are and I like having them as a separate category (not mixed up with other securities). I just set up an investment account named MUNICIPAL BONDS, then entered a new transaction for each of them on the balance sheet, typed in their names, due dates, then made a deposit for each which reflects their face value - so the combined face value (reasonably accurate) shows up in the account view. Interest payments will be entered into their actual account as cash rather than in the municipal bond account, so the bond interest payments won't be properly tracked according to investment - only reflected in the changing cash balance of its actual account which will be updated in AceMoney when I get around to it. Statements from financial institutions take care of the interest/dividend details, so again, all I want from AceMoney is my bottom line so I know when to sell the house and move in with the kids.

I used the same process for I-BONDS. I set up an investment account labeled I-BONDS and lumped them together as one deposit entry on the balance sheet (new transaction titled I-BONDS BALANCE) and occasionally update their combined value on the balance sheet with the "Savings Bond Wizard" provided as a tool by the US treasury. (Each separate bond is entered into the Wizard, it calculates the current value for each bond every quarter, and provides a total for all of them)

UPDATING SHARES AND CASH: I adjust the share amount in mutual funds when interest/dividends or fund costs increase/decrease shares owned. This can be accomplished by double clicking on these securities located on the account page/registry and changing the shares owned. Cash in accounts can be updated on the cash deposit made for that account on the same page. If updating is neglected long enough, the updating process can provide a small emotional boost if it's done right after the market has tanked since some extra value may be found in increased shares or cash added to your cash deposit.

DIVIDEND SECURITIES - non reinvested: Since this method of accounting doesn't track dividends which aren't reinvested, (only shows unaccounted for cash added to the account), I always check my brokerage statements to see if the security that looks bad on the balance sheet is one which is paying enough dividends back to offset the loss. I've almost sold some good dividend securities due to my shoddy bookkeeping. Appalling accounting, but I've managed to make AceMoney do what I want it to do - except tell me when to buy and sell. Maybe the next version?