Finding the Right Home Budget Software
Remember the good old days when Uncle Silas or Aunt Edna came to visit and slipped you an envelope of cash to spend as you pleased? That was free money, but when it was gone and the envelope was empty, you knew the only way you’d get more cash barring another impromptu visit was when your allowance came due. Budget software uses a similar principle to help users allocate money into specific categories, like entertainment. When that month’s envelope for entertainment expenses is empty, it can’t be replenished until the following month (or whatever other period was selected). It’s a nice virtual reminder that resources for specific expenditures are limited. If you don’t have the willpower to stay in your budget, features like envelopes make overspending more obvious and painful than it would be otherwise.Budgeting is part of the financial planning process, but it isn’t the most sophisticated part. If you feel you need to track how much money you spend on entertainment or groceries, you may want to set up a budget that tracks just certain types of purchases; or you may want to track all your purchases but group them into special categories you specify, like emergency chocolate or depression inspired lingerie. Because budget tracking can be an elaborate or simple process, software designed to handle budgeting can be designed especially with budgets in mind or be part of a larger financial services package. It can even be accomplished using a straightforward spreadsheet program and a series of macros:Spreadsheets By far the simplest form of budgeting software is a simple spreadsheet program with a budget template that uses a few macros (special functions) designed to make entering budget data easier. You can even find free templates with a quick keyword search in your browser. This is an easy choice, especially if you have a spreadsheet program like Microsoft Excel or use Open Office Calc. A simple spreadsheet has limited functionality because it won’t, say, import your checking account information with a simple click, but the absence of all those specialized functions makes it a quick start proposition that will have you entering data within 15 minutes. Starting out using a spreadsheet program has another advantage. There are advantages and disadvantages to both options. If you like the idea of maintaining strict control of your information, then a dedicated software package is for you. This will typically be a one time expense, and you won’t have to worry about having all of your data sitting on a server somewhere. That isn’t to say online storage services and cloud computing aren’t safe, but some people like the comfort of knowing that their information is snug on their own equipment (and protected with excellent security software!). The most popular computer based dedicated budgeting software packages aren’t free, but the good news is that they often have value added features like comprehensive tutorials and good customer service support. The top contender in this category is You Need a Budget. It has the advantage of a very involved community of users that can help get you into the spirit of working with the program regularly. Web based budgeting software Like it sounds, Web based budgeting programs aren’t loaded onto a single computer. You access them via your browser. After you create an account, you key in or transfer information onto hosting servers. This may seem a little scary, but often Web based applications have better security than your home computer does. Web based budgeting software has some other attractive benefits, too. Instead of having to rush home to update your information, you can do it from any computer, smartphone or other device with Internet access. Where you may balk at having to spend 20 minutes entering information after a hard day’s work, entering an expense or two while on your lunch hour may seem like a smaller chore. Some Web based budgeting services offer bare bones packages free. Web based services are also pretty intuitive, and compatibility issues are less of a problem, too. If you’re already using one of these solutions to manage your finances, then they’re great options but then you probably already know that. If you aren’t using a comprehensive financial planning solution today, and don’t need the full functionality one offers, then setting up a simple budget may involve more of a learning curve than you want to tackle. If you’ve dreamed about streamlining your financial life with a tool that can do it all, including budgeting, a full featured financial planner is a great way to avoid redundancy. If you’re after something simple, though, a spreadsheet or dedicated budgeting software solution is probably for you.