As you learned when you set up your Quicken accounts in Chapter 2, you use asset accounts to track the value of your property (the things you own) and liability accounts to track your debt (the money you owe). Quicken has many advantages when you’re managing these accounts. For one, if you set up a loan in Quicken to pay off a liability, the program reminds you when it’s time to make a payment. In addition, if you track both your liabilities and assets, Quicken can calculate your net worth (the value of your assets minus the balance of your liabilities), which is a telling indicator of your financial health.
Although borrowing can get awfully complicated with adjustable-rate mortgages, interest-only loans, refinancing, and so on, Quicken can handle just about anything you throw at it. Most people have a hard time understanding the underlying accounting. Once you know how to follow the money, you can easily set Quicken up to track it. This chapter explains both.
Assets, liabilities, and loans form the foundation for tracking what you own and owe, and Quicken groups them in the Property & Debt Center. To make the most of Quicken’s property and debt features, you need to understand the following concepts.
Assets are things that you own that have value, like your house, car, ...