There are a total of 13 basic account types. They are:
Seven Asset Accounts
Use this account to track the money you have on hand, in your wallet, in your piggy bank, under your mattress, or wherever you choose to keep it handy. This is the most liquid, or easily traded, type of asset.
This account is used to track the cash balance that you keep in institutions such as banks, credit unions, savings and loans, or brokerage firms – wherever someone else safeguards your money. This is the second most liquid type of account because you can easily convert it to cash on hand.
Track your individual stocks and bonds using this type of account. With these types of assets, you may not be able to easily convert them to cash unless you can find a buyer, and you are not guaranteed to get the same amount of cash you paid for them.
This is similar to the stock account, except that it is used to track funds.
If you trade other currencies as investments, you can use this type of account to keep track of them.
This is typically a business use only account in which you place outstanding debts owed to you.
For personal finances, use this type of account to track “big-ticket” item purchases that significantly impact your net worth.
Three Liability Accounts
Use this to track your credit card receipts and reconcile your credit card statements. Credit cards represent a short-term loan that you are obligated to repay to the credit card company.
This is typically a business use only account in which you place bills you have yet to pay.
Use this type of account for all other loans, generally larger long-term loans such as a mortgage or vehicle loan. This account can help you keep track of how much you owe and how much you have already repaid.
One Equity Account
It represents what is left over after you subtract your liabilities from your assets, so it is the portion of your assets that you own outright, without any debt.
Income is the payment you receive for your time, services you provide, or the use of your money.
One Expense Account
Expenses refer to money you spend to purchase goods or services provided by someone else.