How to categorize on Quicken, and why you should

Categorizing is as simple as choosing the Categories option when you are setting up your budget in the program.All that you do is click Categories on the lower right to select the categories to include in the budget. Quicken selects all income, expense and transfer categories as indicated by the check mark. To deselect a category, click on it and the check disappears (using Mark all and Clear all is optional if you are looking to expedite the process). If you want to start over with category selection, click Cancel.When you are finished adding your categories click OK.

If you are wondering why you should categorize on Quicken, here are some reasons why categorizing is so helpful:
- When you categorize on Quicken you can more accurately categorize transactions. Quicken becomes faster and easier for customers to use by automatically remembering the last five categories used for a transaction. It allows you to capture and categorize transactions while away from Quicken and provides instant access to your balances, transactions, etc.

- Because Quicken will "remember" categories for each Payee, when you enter a repeat transaction, Quicken will automatically categorize the expense. Although you may need to change the price and payment date, you can delete any transaction from your Quicken checking register and re-enter the amount.

- Categorizing on Quicken makes your online banking even easier. You can download your checking, savings and credit card transaction information from all of your financial institutions and have Quicken automatically categorize your expenses and payees.
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Using Quicken to categorize can help you to more effectively determine where your money is going. Quicken's auto categorization of expenses and payees alleviates the need to manually specify the category for each transaction.

- Categorization is helpful come tax time because you can categorize business and personal expenses for reporting and taxes. Quicken makes it easy to track and categorize expenses, with tools and reports like the Schedule C tax form

Categories can be designed by you to be as complex or as simple as you need for them to be.
To get the most out of Quicken, you should assign one or more categories to each transaction. Categories track the source of a deposit (such as Earnings), the reason for an expenditure (such as Clothing), or the name of the account to which you are transferring funds (such as Checking).

You can manage the way that your transactions are categorized by:
- Editing, changing or deleting a category or subcategory
- Managing the way certain transactions are categorized
- Hide categories
- Use categories with tax-related transactions
- And combine categories into groups

Drawbacks to automatic categorization are few in number but helpful to be aware of.Before you start merging categories and making more complicated transaction combinations, know that you can not undo the actions of re-categorizing or merging categories. You may want to back up your work before beginning to make too many new categories. If the results are not what you expect, restore the backup copy and try again.Also keep in mind that the automatic categorization feature may not work if a default category has been removed or changed from the Category and Transfer List or when a memorized transaction already exists for a specific payee.In this case the Memorized Transaction List will override the Automatic Categorization feature.

Often times unless you are creating a very complex budget, most often to be used with a personal business, you will not have to encounter these more complicated problems.If you do need assistance, Quicken provides customer support via e-mail and telephone for all those who have purchased their software.At no charge you can receive the personalized help that you need to ensure that you create and categorize your budget in a way that is to your liking.