Quicken has become more and more complicated over the years, so I think it may be fair to include a few sentences that review its most valuable and least valuable features. As far as what's best or most valuable, I would say that its checkbook feature is still clearly the most valuable. If you should use one feature in Quicken, it's the checkbook stuff. (To do so, set up a bank account for your checking account as described in Chapter 1 and then use Quicken to keep track of your balances, income, and expenditures as described in Chapter 4.)

I also have to say that I think that Intuit, the maker of Quicken, provides pretty neat stuff at its Quicken Web site, so I'd give that feature my vote as the second best. I don't talk about the Quicken.com Web site a whole lot in this book. That's because you can have more fun and more success with Quicken.com by exploring the site on your own.

Just because I'm super-compulsive not only about my personal finances but also about yours, let me say that I think that the Quicken financial calculators (I describe them in Chapter 10) are also really valuable. If you're willing and able to do just a bit of planning right now, you'll be truly amazed by the positive impact that planning has on your financial affairs a few years down the road.

So this leads rather nicely to another question: What are Quicken's least valuable features? I think the answer really depends on the person. I used to pooh-pooh the online banking because my bank caused me headaches, and my at-home, dialup Internet connection was unreliable. (With a fast cable modem connection now, however, I really do like online banking.) The credit card stuff and cash account stuff don't do much for me. But you know what? Those tools may do wonderful things for you. It depends on the way you've organized your finances.

I guess the bottom line, to me, is that the least useful features depend on what you don't need to do. But what you don't need to do will probably differ from what I don't need to do. I'm sorry that I don't have more helpful criticism.

Sure. But let me talk for a minute about what's unique — at least from an accountant's perspective — about a corporation.

In addition to recording assets (such as bank accounts and receivables) and liabilities (such as mortgages and trade payables), a corporation often needs to track, or keep records for, stockholder equity.

Stockholder equity includes the amount people originally paid for their stock, any earnings the corporation has retained, cumulative income for the current year, and sometimes other stuff, too.

"Ugh," you're probably saying to yourself. "Ugh" is right. Accounting for stockholder equity of a corporation is mighty complicated at times. It's so complicated, in fact, that Quicken can't track a corporation's stockholder equity.

Fortunately, the financial information you collect with Quicken provides, in rough form, much of the information that your poor accountant needs in order to do things manually.

But, er, this all makes me remember something else. If your corporation enjoys revenue of $250,000 per year or more or owns assets that total $250,000 or more, you must include a balance sheet with your corporate tax return. (This isn't something I just made up. It's actually the law.) Quicken isn't very good about creating business balance sheets — or at least the sort of balance sheet that needs to get included with your tax return. Accordingly, if your corporation grows so that its revenues or assets equal or exceed $250,000, consider retiring Quicken and upgrading to QuickBooks.

Yep, it does. But a partnership that uses Quicken faces the same basic problem as a corporation that uses Quicken. In a partnership, the partners want to track their partnership capital accounts (or at least they should). A partnership capital account simply shows what a partner has put into and taken out of a business.

As noted in the preceding section, Quicken calculates a net worth figure for you by subtracting total liabilities from total assets. So, to the extent that your total assets and total liabilities are accurately accounted for in Quicken, you know roughly the total partnership capital.

To solve this problem, you (or someone else) need to track what each partner puts into the business, earns as a partner in the business, and then takes out of the business. You can also (and I've helped clients do this) just use the Quicken loan accounts for partnership equity accounts. You just need to not get freaked out when your net worth shows as zero, and you need to remember that the partnership equity accounts aren't really loans — they're capital.

One other thing to think about here concerns your partnership tax return. If your partnership books revenue of $250,000 per year or more or owns assets that total $650,000 or more, you will need to include a balance sheet with your partnership tax return. As mentioned in my earlier discussion about using Quicken for a corporation's accounting, Quicken isn't very good about creating the sort of balance sheet that needs to get included with a tax return. Accordingly, if your partnership grows so that its revenues equal or exceed $250,000 or so that its assets equal or exceed $650,000, consider upgrading to QuickBooks.

Yeah, but be very careful. Very careful. You must be especially diligent in keeping the two businesses' financial records separate.

Quicken provides a handy tool for keeping them straight: You can work with more than one file. Each file, in effect, is like a separate set of financial records. You can't record automatic transfers between accounts in different files; instead, you must record each side of the transaction separately. You can, however, keep truly separate business records.

To create a separate file, choose File

If you've been using Quicken for a while, you can probably figure out for yourself how the File

You're probably saying to yourself, "Quicken works for corporations (sort of), and it works for partnerships (sort of). Does that mean that it works for just about any kind of business?"

The answer is no. Quicken is a darn good product. In fact, for many small businesses, it's a great product. But it doesn't work in every situation.

The following is a three-part test that you can use to determine whether your business should use Quicken. If you answer yes to two or three of the questions, you should seriously consider moving up to a full-featured, small-business accounting system (like QuickBooks).

Yeah. Absolutely.

In a nutshell, all you need to do is set up an income category to track your rental income and then some expense categories to track your rental expenses. (In Chapter 2, in the section about changing a category list, I describe how to set up income and expense categories.)

To see which rental expense categories you need, either look at the Schedule E tax form that went with last year's tax return (if you've already been investing in real estate) or grab a Schedule E tax form from www.irs.gov (if you're new to real estate investing).

Now, before you stop reading and rush off to do the bookkeeping for your growing real estate empire, let me tell you one other critical thing: The Schedule E tax form on which you report your real estate income and deductions requires you to segregate your income and deductions by property. For example, if you have two rental properties — a duplex on Winston Street and a single-family cottage on Roosevelt Avenue — you'll need to break down your income and expenses by property.

To break down income and expenses by property, you use a Quicken feature called tags. Oh, yes, it all sounds complicated. But all you need to do is enter the tag name in the Tag field. For example, rather than just enter rent in the Category field when recording a rent payment from your tenants living in the Winston Street duplex, you enter rent (as the Category) and then also enter Winston (as the Tag).

By appending the tag Winston to the transaction, you can later easily produce a cash flow that shows income and expenses for the Winston duplex.

Just to make sure that you understand this, let me give you another example. Rather than record a check to pay the utilities expenses for the house on Roosevelt as utilities, enter utilities as the category and Roosevelt as the tag.

By appending the tag Roosevelt to the transaction, you can easily produce a cash flow later that shows income and expenses for the Roosevelt cottage.

A couple of other notes about this: The first time you enter a tag name into the Tag field, Quicken asks whether you want to set up a new tag. When you click "Heck yeah," Quicken prompts you for a bit of information about the tag. After that, though, you just enter the tag without fanfare or embarrassment.

To produce a report that summarizes income and deduction information by tag, choose Reports

I talk a bit about the rental property management features in Quicken in Chapter 16.

Yeah. And the idea is better than it may seem at first.

Entering one year's worth of transactions doesn't take long in Quicken (as long as you have decent records to work with). If you're a millionaire, the task may take you a couple of days. (Of course, in this case, you can hire someone to do it for you.) If you're a regular, ordinary person, I bet you can get it done on a rainy Saturday afternoon.

After you enter all the information into a Quicken register, you can easily monitor your spending in various categories, track your income and outgo, and reconcile your bank accounts. I know one professional who uses Quicken records to do these things every year. Hey, it's not the most efficient way to do things. And it's not a very good way to manage business or personal financial affairs. But it works. Sort of.

Yes. See Chapter 15 for more details.

By the way, if you have only one or two salaried employees who always earn the same amount — a nanny, for example — you can rather easily use Quicken for payroll. But if you have a bunch of employees or even a single hourly employee, you'll probably want to either purchase a full-featured, real-live, small business accounting program (such as QuickBooks) or use a payroll service (such as Paychex or ADP) to take care of the whole thing for you.

Intuit makes and sells QuickBooks, as you may guess by its name. You can get QuickBooks from the local software store, from one of the mail-order places, or by downloading it from the Intuit Web site.

You can look up either payroll service — Paychex or ADP — in the telephone book. You can also look up either payroll service — Paychex or ADP — at www.paychex.com or www.adp.com, respectively.

Not with Quicken Premier or Quicken Deluxe, but you can (very nicely, thank you) with Quicken Premier Home & Business and with Quicken Rental Property Manager. If you want invoices, at least step up to Quicken Premier Home & Business. This requirement may also be a symptom indicating that you should consider moving up to a full-featured, small business accounting system, such as QuickBooks.

Someone had to ask this question, I guess. (Imagine me taking a deep breath here.) Yes, you can import data from your old accounting system. To do so, export the old system's data into a file that matches the Quicken Interchange Format, or QIF, specification. (A QIF file just neatly organizes financial information in a well-documented structure so that other programs — and even people — can read and understand the data.) Then import this file into an empty Quicken file. Keep in mind, however, that this process isn't for the timid or fainthearted. I would also say that it isn't for people who have better things to do with their time.

My advice to you? Go to a movie. Mow your lawn. Read a trashy novel. Forget all about this importing business. Or, if you're really determined, look for a QIF conversion tool on the Internet. They do, er, exist.

I think it's great. But I bet your question isn't really whether Quicken is good or not. Heck, the package has something like 10 million happy users, so we both know that the package is pretty good, right? My guess is that what you really want is my opinion about using Quicken in particular business or personal situations.

It's tough to answer this question in a one-way conversation. Even so, let me give you some of the best reasons for using Quicken:

I hope these answers help. My guess is that if you think that a program such as Quicken will help you better manage your financial affairs, it probably will.