Turn over a new leaf: Financial Literacy on Steroids... January 2013

In 1986, in London Drugs computer department, Ladner store, on one of those carousels, I met Quicken software. On the front cover of the box, I was promised this software would help me reconcile my bank account. There was nothing else out there that reconciled your bank. I was hooked. Still am and still download and reconcile my accounts at least once a week.

Why was I so enamored? I'd spent about a year, in 1983, manually reconciling the bank accounts of Century 21, the Canadian franchise company for the first five years of it's existence. It would take me a whole day, sometimes two, to reconcile one month's cheques and deposits. The stack of cheques alone was 8 inches tall, for one month. I was looking for how come the general ledger was out of balance before we computerized everything. The books were still manual at that point.

In 1986, my first client in my accounting practice had investments, so I opened the investment module and started entering transactions to figure out the gains and losses. Ran smack in to stopped and superficial losses.

Over the years, as each new client came for a visit, I would open a Quicken file, and record in it their accounts, their assets, their debts, and produce a draft of their net worth. Every so often a client would call, ecstatic because their banker had high praise for how organized they were because they knew what they owned and owed. It happened again, just last month.

My motivation wasn't the same as my clients. I wanted to make sure I caught all of the taxable transactions and sometimes that included proceeds for other assets, sometimes at a gain, and it also caught when they inherited, and co-mingled the inheritances with a spouse, and tried to split the resulting income. It helped me to determine whether there was a gain or a stopped loss when an investment disappeared off the broker statement, and re-appeared on the RSP or TFSA statement, but the funds went somewhere else. Why? Because the T5008 doesn't record deemed dispositions of investments to your RSP and there very well could be a capital gain that resulted.
It helped me when they called, asking me what they should do if ... because we could easily take a copy and do a what-if scenario, using Quicken and the tax software to calculate the cash flow and the tax consequences of their proposed actions.

How do you remember what everyone owns and owes? How do you quickly get up to speed, remembering the nuances of each client's financial situation when they call asking for your assistance? For me, this software has been an enormous help.

I haven't kept track of how much I've made from using Quicken, but it wouldn't surprise me if it was more than from QuickBooks. On a consistent basis, over 27 years, I have an electronic trail of investments, accounts, assets, liabilities for each client. Sometimes they've asked for a copy so they could download their transactions and start to keep a more accurate record of their day to day spending, but mostly, it's just been an annual update, taking the pulse if you will for how are they doing. I remember times when we've stopped to ponder and celebrate reaching a milestone, a net worth of 500,000 or one or two million. I remember splitting apart assets for a separation, and merging them for a second marriage. Quicken provided a convenient method of keeping track.

Now maybe you find that too invasive, but the clients I have value that I care enough to keep track. That's part of why they hire me. They want my advice and they know that I have a system of keeping track so that when they asked a question, I already had the background. I had already calculated their ACB (see my post on 27 reasons to calculate ACB if you haven't already read that, or visit it again for a refresher)...

I hope you'll consider attending the January series. I know it's a shock that it isn't free, but, I guarantee that if you adopt Quicken as a tool in your arsenal of record keeping tools, you'll make money using Quicken in your practice. You'll make much more than the cost of this workshop and you'll have peace of mind knowing you aren't forgetting something you should know about your client's financial position if you prepare their taxes.

If you sign up before December 31 for all four sessions, you'll receive the recordings free of charge after the last session.