Managing the buying and selling of assets in PocketSmith
Learn how to update your PocketSmith to show the buying and selling of assets, and how to manage their associated transactions 🚗🏡⛵️💰💎
In this user guide
Overview
If you've purchased an important investment, such as a car 🚗or a house🏡, it’s really easy to add this to your PocketSmith account as an asset. If there are any large transactions from the purchase of the asset, which you don’t want showing as an expense, you can instead mark these transactions as a transfer to represent the funds simply moving to the value of that asset.
If you've sold an asset, you can easily update the value of that asset in PocketSmith to zero to represent this. This will reflect that you no longer own the asset, but allows you to retain the balance history associated with that asset. If there are any income transactions from the sale, which you don’t want showing as income, you can instead mark these transactions as a transfer 🔄.
To accurately reflect the purchase or sale of an asset in your PocketSmith forecast, you will need to add a budget, or possibly budgets, to suit. We’ve got all the details below. Read on to learn more about buying or selling assets!
Buying an asset
If you've recently purchased an asset that you'd like reflected in your PocketSmith, you'll just need to add the asset and categorize the associated transaction accordingly.
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Create an asset in your PocketSmith account to reflect the asset you bought. For detail on how to do this, see
Adding an asset to Net Worth
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Categorize the expense transaction to a category of your choosing. eg.
Boat purchase.
If you don't want this to be recorded as an expense in your PocketSmith, change the category to a transfer category as detailed here:
Steps to create a transfer category. Transactions marked as transfers 🔄 won't appear in PocketSmith reports.
If you don't want this to be recorded as an expense in your PocketSmith, change the category to a transfer category as detailed here:
Including an asset purchase in your forecast
If you would like the purchase of the asset to be reflected accurately in your forecast, you'll also need to add an expense budget for the category you've assigned the purchase transaction to. Make sure to set the budget start date to the date that the purchase transaction occurs.
For detail on creating a budget see: Creating a budget on the Calendar page
Selling an asset
If you've sold an asset, you'll need to adjust the value of the asset to zero and categorize the credit transaction accordingly.
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Change the value of the asset to 0.00, on the date that it was sold, as detailed here:
Updating the value of an asset or liability from the Calendar page
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Categorize the income transaction to the appropriate category. eg.
Boat Sale
If you don't want the credit transaction from the sale included as income in your reporting, change the category to a transfer category as detailed here:
Steps to create a transfer category. Transactions marked as Transfers 🔄 won't appear in PocketSmith reports.
If you don't want the credit transaction from the sale included as income in your reporting, change the category to a transfer category as detailed here:
Including an asset sale in your forecast
If you would like the sale of the asset to be reflected accurately in your forecast, you'll need to add an income budget for the category you've assigned the income/credit transaction to. Make sure to set the budget start date to the date that the income was received.
For detail on creating a budget see: Creating a budget on the Calendar page
Selling an asset with a linked liability
If you have sold an asset that is linked to a liability in PocketSmith then you'll need to change the value for the asset and also adjust the balance of the linked liability to suit. Any associated transactions will need to be categorized to suit.
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Adjust the value of
both
the asset and the liability to zero from the Calendar page on the date that the asset was sold.
Updating the value of an asset or liability from the Calendar page.
If the sale of your asset does not completely cover the balance of the linked liability, then update the value of the liability to the remaining balance.
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Categorize any associated transactions to suit.
If you don't want the credit transaction from the asset sale to be included as income in your reporting, then it's best to change the category to a transfer category as detailed here: Steps to create a transfer category
If you're transferring some money from the sale towards the liability, this transaction should also be assigned to a transfer category, eg. Transfers.
Note
If you're wanting to record some of the credit transaction as a profit, and some as a transfer, then you'll need to first split the credit transaction, and then categorize each portion accordingly. To learn how to split a transaction see: Splitting a transaction
Including any transfer transaction related to the asset sale in your forecast
If you're transferring funds from the sale of your asset to your liability, and you'd like the movement of these funds to be reflected accurately in your forecast you'll need to add an expense budget for the category you've assigned the transfer transaction to. Make sure to set the budget start date to the date that the funds were transferred.
For detail on creating a budget see: Creating a budget on the Calendar page
Selling an asset with a linked loan account
If you have sold an asset that is linked to a loan account in PocketSmith then you'll need to change the value for the asset. Any associated transactions will need to be categorized to suit.
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Adjust the value of the asset on the date the asset was sold as detailed here:
Updating the value of an asset or liability from the Calendar page
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If the sale results in your loan account being
closed, you'll need to unlink the loan account and make any adjustments necessary to zero the account.
We've got all the detail on how to do this here: Dealing with a closed bank account in PocketSmith
If you still have a balance remaining on your loan account, then your account balance should be automatically updated, and you can continue to the next step to categorize your transactions.
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Categorize any associated transactions to suit.
If you don't want the credit transactions from the asset sale to be included as income in your reporting, then it's best to change the category to a transfer category as detailed here: Steps to create a transfer category
Any transfers between accounts (eg. the money transferred into your loan account) should be treated as a transfer.Note
If you're wanting to record some of the credit transaction as a profit, and some as a transfer, then you'll need to first split the credit transaction, and then categorize each portion accordingly. To learn how to split a transaction see: Splitting a transaction
Including any transfer transaction related to the asset sale in your forecast
If you're transferring funds from the sale of your asset to your loan, and you'd like the movement of these funds to be reflected accurately in your forecast you'll need to add a transfer budget for the category you've assigned the transfer transaction to. Set the budget date to the date that the funds were transferred.
For detail on creating a budget see: Creating a transfer budget on the Calendar page
