I love technology and automating money management as much as possible. Here are some of the advantages I find with using money management software to manage our family finances:
1. Save Time with Tracking Spending
You can’t get around some work involved in tracking expenses but software can help you save time by making this exercise more efficient. Some budget software automatically downloads or reads transactions from your bank so you don’t have to enter them manually. And some software let’s you download the transactions from the bank and upload them. In either case, this saves a lot of time!
2. Create Budgets to Monitor Spending
While you can write out a monthly family budget, leveraging the budget from month to month with some updates saves time. The biggest advantage to money management software, in my opinion, is that once transactions are categorized, the spending is automatically deducted from the budget category letting you quickly see how much money you have left for food or other areas of your budget.
3. Integrate Accounts in One Place
Some money management software provides a big advantage in that you don’t have to log into multiple accounts to see your balances and check spending. Account integration is especially helpful if you have car loans or credit card balance you want to track besides your checking account. Also, seeing an entire picture of all of your finances can help you get the full story and make better decisions. Mint.com does a good job of this but I don’t recommend it for budgeting.
4. Create Plans to Accomplish Financial Priorities
I think the ability to create plans to accomplish your goals is a huge advantage of personal finance software. Setting up a savings plan or debt plan can help you keep your priorities in straight. Even if your software doesn’t have this planning capability you can always track financial contributions to your goal as a budget category.
5. Go Mobile
Personal finance software should be mobile. That means you can enter transactions from the check out counter at a store, or check your budget before going into the mall. Some software helps with entering transactions by pre-populating the payee’s name based on your location. I wouldn’t waste your time if there isn’t a good mobile app to accompany your software or service.
6. Reduce Paper
Finally, integrating your accounts into personal finance software no doubt saves paper which in turn helps you avoid having to keep a file of bills and receipts. This is also a good way to be more green as a family. Honestly, keeping up with filing statements and financial documents has always been something I’ve easily fallen behind in doing. This chore has been greatly reduced by the software we use.
What’s your favorite money management software?