What are categories and tags all about?
Categories and tags both help you track where your money actually comes from and goes to, and they enable you to use reports and budgets to manage your finances more effectively. Once you have created accounts and added transactions, the real strength of Banktivity comes in tagging and categorizing those transactions.
What are the differences between categories and tags?
Categories are intended to be the primary means of classifying your transactions. A single category may be assigned to each transaction, though if you split a transaction you can assign a category to each split item. Categories are organized hierarchically, so on your reports you can get a high-level view of your spending and then drill down for more detail. For example, you might create the "Auto" category for all of your vehicle-related expenses, but assign subcategories like "Auto:Fuel" and "Auto:Service" to individual transactions. You can then create a Category report for "Auto" and see how your spending in that category is distributed across various subcategories.
Tags are intended to be used for secondary classification. Tags are not exclusive like categories are, so multiple tags may be assigned to each transaction. They are good for arbitrarily grouping transactions together, such as all your expenses from a particular vacation or purchases charged to a particular card within an account. Tags are not hierarchical, but you can create overlapping associations by assigning multiple tags to your transactions. You can then create tag reports to analyze the expenses marked with any combination of tags.
Categories and tags can be used together for maximum effect. For example, you may use categories to classify your spending among Dining, Entertainment, and Clothing, then assign tags to track who purchased each item - you or your spouse. Using reports, you can then slice and dice the data to analyze not only what you are spending, but when, where, and by whom.