Good-Bye, Microsoft Money! 16 Powerful Personal Finance Programs

Also I don’t understand some people’s requirement for connecting to banks’ online feeds? It only takes seconds to enter a transaction, why would you discount an application because it can’t do that? How many transactions must you do in a day anyway?

Maybe I don’t understand because I use envelope-style budget buckets within Money with subaccounts so downloading wouldn’t work for me, but it seems you’re not doing much more than duplicating the banks reports if you do that, instead of tracking for yourself. Where’s the benefit?

@Not My Mother: The benefit is that if you can automatically download your bank statements, it makes it easy to reconcile the transactions you have entered with the data your bank has.

I’ve been using Wesabe for a month or so, and recommend it. There are currently some temporary issues because it is in the midst of an update: for example, the community-data-based Tips section that was a major attraction to me isn’t running right now. But they are adding Investment accounts tracking, and it has neat tricks like a flexible Tagging system, excel-like automatic mathematics (e.g. I can put my total spent as “=(24*3)+6.5″ and it calculates it for me), Cash accounts that count towards your budget but don’t hold a balance, lots of graphs and spending trackers, etc. And it’s free!

This useful list could be made even more powerful by listing what operating systems other than Windows it also runs on, next to the name of the software.

@Matt –

Thanks for the info! I’ll be sure to check it out!

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matt @ Thrive says:
02 July 2009 at 7:30 am

@Kelly: A feature similar to what you’re asking for (where we can predict your bills and income, and show you how much is left) is coming to Thrive in the Fall. I don’t have an exact date yet, but I’m hoping for mid-September, depending on how busy our engineers are.”
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I’m looking forward to a service with this feature. Like Kelly, I want to plan my cashflow. I like seeing when in the future my balance might be getting low, or when I’ll have a surplus, and then schedule transfers or extra payments on debts, etc.

Earlier I was using spreedsheets to track my expenses till I learnt about rudder.com and also they have launched Rudder iPhone app! now I can use rudder as and when required, no need to switch on the pc.

YNAB (for Windows) is very popular for users more concerned with budgeting and does a good job. A popular program at the moment for Mac seems to be MoneyWell, which is also great for budgeting. And for those Microsoft Money users with years of data and over 10,000 transactions – Quicken and Microsoft are working on an import tool to get all those transactions over into Quicken (should you decide to give Quicken a try).

I am another former Quicken user who has been happily using Moneydance for 3-4 years now. Not quite as polished as Quicken or Money, but it is just as powerful.

Quicken pushed me over the edge when I had to start paying for updates to maintain my online functionality. I didn’t need the new bells and whistles, I just wanted to maintain my existing functionality. I was frustrated with this, switched to MoneyDance, and have been happy ever since.

If this can help anyone here, here’s a software directory that lists hundreds of accounting/financial apps: http://www.all-finance-software.com .

I’m currently using Quicken Online and it’s been of great help so far. I tried Mint months ago and didn’t like it.

I feel like I’m missing something… so, as previously stated, I’ve been using MSMoney forever now – part of the reason I liked it was that even back in 1997 I could automatically update my accounts through the software… i.e.: I didn’t have to connect to each back/investment broker individually to update my account registers with their download files. So far, I have not found any replacement programs that will do this for all or even most of my accounts. While, for example, Moneydance has a nice register and reports, it doesn’t touch any of my banks – ing direct (the main one) or bank of America (I’m in WA and it has a different login than all the others – don’t ask me why), but I can manually do it by downloading the files from the bank website. Once Money stops supporting the update feature, it’s not as if the program itself will stop working – I can still manually download everything, so unless someone else does this, why switch? So, a) am I wrong that the Money will continue to work, and b) does anyone else do this with the register option (ie – while Mint and Thrive are great, they don’t have a register, which is a must for me). Thanks!

@Scott: I think I have it. Truthfully, I don’t think we’re quite moving that direction, and here is why:

One of the primary issues facing people when they start budgeting and working with their money is that they have the tendency to deal with what psychologists call “mental accounting.” That is, they assign things to categories and then are reluctant to move between those categories, even when they logically should.

For example, let us imagine two situations. In one, you buy a concert ticket for $10. When you get to the concert, you discover that you’ve lost the ticket. In the second, you always planned to buy the ticket. When you get to the door, you discover you lost $10 on the way to venue.

In the first case, your envelope budget would prevent you from buying another ticket, because you only had $10 in your “concert going” envelope and you spent it already – another $10 would be cheating. In the second case, you would be free to buy it, because the $10 wasn’t yet assigned to a cause, and so you still have the $10 in your “concert going” envelope.

The trouble is that either way, the concert cost $20. And when you consider this across the board, in a large number of categories with rather a large amount of money, things get dramatically bad. For example, a shocking number of Americans have both credit card debt and money in their savings account. Not because they are logically setting a small amount aside for an emergency fund, but because “saved” money “shouldn’t” be spent on paying down credit card debt. Consequently, they drown in interest that they shouldn’t really be paying.

I’m not saying we’ve decided this firmly at Thrive. But I’ve spent some time thinking about it, read a good deal of my colleagues research, and it does seem like “envelope” budgeting has some pretty serious drawbacks that we haven’t found an effective way of dealing with. Again, doesn’t mean there isn’t a way, just means we haven’t found one yet.

@Steve: I absolutely worry about that, and I’m glad you do to: being cautious of a site that you are trusting with your financial information is always, always a good idea. We want consumers are to be intelligent in the world and to understand the risks and rewards, so we try to be as clear about them as we possibly can.

Here are a few things to think about (I’m summarizing from a variety of responses I’ve written over time about this issue, so apologies if you’ve read this from me elsewhere):

For one, and I think this is big: you can actually call us. We pick up the phone, we talk back, we’ll answer questions and address security concerns. We even welcome visitors in the office, if they are in NYC – you can come check on the people that accepted your sign-in data and we’ll usually buy you lunch, if someone is free. I’d love to see other companies make the same commitment (and even banks, for that matter).

Another difference: unlike many of the startups that, as you point out, may go away, we’re owned by a major company. We were purchased by LendingTree in February, which gives us the stability and resources to be a proactive force on the consumers. We’re actively out there in the world, talking about bank and data security, and what people can and should do to keep themselves safe. We consider increasing financial literacy (which includes security discussions) part of what personal finances need to do to help the public and serve their members – heck, we’ve even submitted stuff to Congress to try to get them to back financial education on a federal level.

Unlike some others, we also ask for your name and phone number. Why? Because in the event of a data emergency, we want to be able to contact you immediately, verify your identity, and get to work dealing with the problem. Anonymity is a double-edged sword: less for hackers for steal, but less ability to actually help you with security issues.

These combined serve to reinforce one of your points: if you are going to work with a personal finance site, you want one that is actually interested in your welfare and will help you with any issues that you have. We are not a churn-and-burn shop and we were founded to help people.

A few notes that apply to the way Thrive handles your data (I can’t speak to other’s systems – I’m sure you could write them and they might answer). The way I like to explain the one-way security tunnel is as a multi-step process. When you first login, we take your sign-up credentials and they are sent to your bank, to create the secure tunnel. We DO NOT store the logins on our server – after the secure tunnel is created, it simple sits as a one-way tunnel for information. Banks can push information to us, and we cannot push it back.

If you change your login credentials, your bank breaks the tunnel and lets us know – we then request updated credentials for you. Again, your credentials are not stored on our servers, they are simply used to recreate the tunnel.

So there are two data-loss situations. In one case, you Thrive account credentials are hacked and someone can log in as you. What can they see? Your balances, your transactions, what types of accounts you have, and what banks you use. Damaging information, to be sure. But they don’t have your bank passwords or logins, they can’t change anything at your bank or move any money around. They can only view some sensitive information about you, which they could get straight from your mailbox – it is the same information on any paper statement you receive.

The other data-loss situation is a hacking of our servers, not just your account. The same information is available, but on a vastly larger number of people.

You sum it up well: everyone has to choose for themselves, based on the positives and negatives, whether joining a site like Thrive is right for them. And honestly, if someone understands all the considerations and still chooses not to use Thrive, we’re totally fine with that – it isn’t for everyone and some people are less comfortable than others. I simply care that people understand what they are and aren’t making accessible by using such a site, and all the things they stand to gain.

I’m a behavioral psychologist and we’ve worked hard to make sure that Thrive gives measurable help to our members. We can see, in concrete numbers, how our system changes people’s financial behaviors, and the money they save by making infrastructure improvements, understand where they spend and why, and working towards their goals and plans in an organized way. So for all this talk of data security, there is a very real upside to joining Thrive and I wouldn’t want to have a security discussion without ending on that note.

@Dustin: The problem is in that last bit – deciding whether to take money from another envelope. The trouble becomes that people are unwilling to be flexible in their accounting when using an “envelope-like” system in their mind and on paper, which can create some serious oddities that can hurt them financially. You want people to have budgets, but you don’t want them to be so rigid that they cannot adapt.

Check out http://en.wikipedia.org/wiki/Mental_accounting and some of the associated Wikipedia articles for some work by Dick Thayler and others pointing out the sort of irrationalities that can occur because of this, or check out Dan Ariely’s “Predictably Irrational”. Science – it’s awesome.

I have tried many of the services, YNAB, Yodlee, Wesabe and none of those services had what I was looking for, or their program linking accounts would not work as well. I had a problem with some of YNAB’s feature, but there is a dedicated forum to helping out new users.

I switched over to GnuCash, and enjoy it. This a powerful program, and although it does not feature a budget feature (as some readers have mentioned), it is a useful program to view your expense, income, and liability accounts and you can make adjustments from there.

OK, everyone – give me your opinions here!

Which of these sites best incorporates the following:

1) Budgeting
2) Account Registers
3) Cash Transactions (manual entries)

I’m looking for a single online or desktop tool that will allow me to create a budget, manage my checking and savings account balances, and track my cash expenditures as manual entries, so that I can get a true, complete picture of our total cash flow.

Also important to me is an iPhone app. I have an infant, and don’t spend much time sitting at a computer, but I have LOTS of time to sit with my iPhone. So, a robust iPhone app would be super.

Thrive looked really good until I realized that they don’t allow manual transactions. Can’t stick to a budget if I can’t track cash. Same goes for Mint.

Please help!!

@Krys: Feel free to try out Inzolo.com. It is a envelope based budgeting tool so the focus is on the budget. It supports imports from Money & Quicken files and has automatic OFX import support. It also allows you to add manual transactions.

I don’t have anything yet to match uncleared transactions as Chris has described and I don’t yet have an iPhone app. I do have an iPhone though so it is definitely on my to do list! It is all web based so you can access it on Safari on your iPhone, but there are a few limitations I need to work out with that method.

@Chris – Thanks for the details on YNAB! I was an MS Money user for many years, and I guess I’m looking for something similar. I found it hard to “keep up” with Money, and ended up binge entering data once a month. With a newborn, I’m looking for something a little less labor intensive.

@Dustin – I’ll take a look at Inzolo! The iPhone app is a must for me. Safari access is OK, but I’ve found that data entry on pages not designed for iPhone are really, really tough. But, as a fellow iPhone user, I’m sure you know what I’m talking about.

@Craig – How do you compare to PearBudget? They’re a budget-only site, and I’m in the middle of my trial month with them. I’m really looking for an application that can do both budgeting and “checkbook balancing” in one location. Do you offer that?

I am a graduate school teacher. I want to assign to incoming students at my school a problem that will introduce them to a computer finance program. I have come to believe that the most important thing in financial management is keeping track, and if students will start tracking their spending they will be less likely to get over their heads in debt.

I’ve used Quicken since it first came out in the late 1980s, and it has helped me keep track of my finances. However, the company has gotten worse and worse – eliminating support after three years to force people to update, coming out with multiple stripped-down starter versions and moving to much more expensive programs, and adding tons of unnecessary bells and whistles. I’m so committed to the program that I can’t yet get myself to change, but I wouldn’t recommend the program to someone starting out. I also want something free.

I’ve used web site programs like Yodlee and Mint, and they are great at consolidating information from your on-line accounts, but they are not good entering and reconciling your transactions. They give you the bank’s balance, but it’s not so easy to know what checks or charges are outstanding. They are better as a backup for a real accounting system.

I have played with quite a few programs, and I am leaning towards gnucash. Unfortunately, it has a bigger learning and setup curve than most programs have. For people who do not understand double entry accounting, I suspect it would be a bit confusing at first. But it is also very powerful, and would be a great program for new people to learn.

My idea is to give the students some fake check registers, credit card receipts, and bank statements, and require them to reconcile the bank statements and answer some questions to show that they understand the balances. My hope is that once they do it for the assignment, they will set up their own accounts.

Does anyone have any thoughts about this?

@krs: Keep checking back with us – we’re working on manual transaction editing. Really, what I need to get in there is transaction splitting, so that you can take the withdrawal (for example, from an ATM) and split it into different categories. Like most things, it is simply that we only have so many hands: we will add it, but I don’t have a current timeline.

Also, on the subject of iPhone app, that is coming (and sooner than transaction splitting). I can’t confirm exact date, but I can confirm that it is already designed and is in the hands of engineers.

@Classical: Having been a graduate student, I’m curious: why do you think this is the exercise that is most worthwhile? That is, the reconciling of charges is something that banks seldom get wrong, particularly as things become increasingly automated and done over ACH networks. Indeed, you state that the value is in “keeping track”; I’d argue that actually has two functions: monitoring for the modification of current spend and understanding regarding overall balance sheet and cash flow.

For the monitoring of current spend, I’m not sure you need to be doing it on paper and matching each expense to a corresponding transaction on your balance sheet. That is, unless you believe that the credit card charge you made won’t actually show up on your account (and with a high degree of accuracy, we can be sure it will), the value is in being forced to interact with the costs of your actions. Doing this electronically seems infinitely more effective: watching kids go “wow, I spend that much of my income on restaurants?” is more effective then watching them go through each receipt to discover that (if they discover it at all, as paper doesn’t have the same auto-categorizing functions that electronic programs do).

Indeed, do you actually expect that your kids will go home and then do this themselves for the rest of their lives? They might, I’ll admit. But everything, in a psychologist’s model, is competing pressures and the heavy time pressure not to do what you’re suggesting that means most your kids won’t actually do it for their own finances. So even if manual transactions are more effective at teaching (and I’d argue they aren’t), you’ll reach perhaps one or two of your students, while an automatic electronic system will reach a greater percentage.

Perhaps I can make the difference more clear by using an analogy. Think about a calculator, which abstracts away basic math. The reason we use them is because they allow for higher order thinking, and so we teach basic math at young ages so people understand it, and then move on so that they can progress.

Understanding “money in, money out” is a fairly basic concept that most people get. So let’s take them to the next level. Let’s use programs like Thrive and Wesabe and others to say “look, you get the money in, money out, bit…now let’s look at what it means.” We take care of that manual lifting so that they have time to do the part that matters: outcomes, higher order thinking, actual life planning.

That ended up a bit rantish, but I’m passionate about this subject: the sort of “manual transaction” system is what has been taught in almost every single major financial literacy initiative and has been shown to be ineffective. Let’s try something different. Let’s teach our kids not how to balance a checkbook but how to understand compound interest and how to apply that to the best use of their money. Let’s teach them how to buy a home instead of how to work a ledger. Because ultimately, if one check every few years slips by, it will harm that much less than not having the knowledge they need to actually make the financial decisions.

Thanks for your thoughts, Matt.

There are two problems with people relying on their bank balance. First, they often bounce checks because of outstanding items that have not cleared yet. Bounced checks can be VERY expensive and damage one’s credit. It’s not a problem if you keep a lot of money in your checking account, but that’s not a great idea because checking account interest rates are usually very low and some don’t have extra money. The banking rules allow banks to maximize the damage for overdrafts by allowing them to put the highest check received in the day through first, often causing lots of smaller overdrafts. Better to know what is in your account when you write the check, which is what the law expects. As far as I can tell, there is no easy way to do that with an on-line system.

Second, you may not catch mistakes and fraud if you don’t check your transactions against another record. When you buy something for $22.50, and the charge shows up as $32.50, how are you going to catch it? I enter all of my checks and charge card receipts, and then reconcile to the bank statement. I’ve caught many mistakes over the years, some made by me, some made by the bank, and some made by the store.

Don’t get me wrong – if you use an on-line system, and put your transactions into proper categories, you’ll be doing a lot better than most people who have no idea where their money goes. And you’re right that my main goal is to get people to think about making expenditures and watch what they are spending. It’s just not completely verifiable without a matching system.

The big question is whether this exercise would be a waste of time because the students won’t set up a tracking system for themselves. And I’m sure you’re right – many of them won’t. If all of them don’t, then I’m wasting my time and their’s. Is it worth the exercise to force them to download and install the software, set up the accounts, enter the transactions, and reconcile the statements?

@Classicalguy – I agree – I wish someone had shown me something…anything about money when I was younger. I struggled for a while in my 20′s before I finally got the hang of things in my 30′s. I think even if you only reach one student, that its worth it.

Last night I opened a new Thrive account and OMG I love it! The interface is so much more intuitive and practical than Mint. I think I need to get with Matt for a few tweaks … but once those are resolved, I will definitely be canceling Mint in favor of Thrive.

@JD
Thank you very much for this post. I am sure it took a while to research but it is the core organizational tool for a lot of people who mostly handle their finances online… and it’s nice to know the different options out there to decide “what works [best] for us.”

@DY in Comment # 111:
I highly recommend that you try CalendarBudget for cashflow prediction (www.calendarbudget.com).

I’m surprised you didn’t include FreshBooks.com

@Matt – I agree with ClassPro & ClassicalGuy – I specifically don’t rely on my bank balance because it’s not accurate. Say I have $1500 in my checking account and I know that my rent for $1150 will auto-withdraw tomorrow, so I know with a little math that that will leave me with $350. But, say I forgot that I wrote a check last week for $300 and sent it via snail mail – well that’s not reflected in my account anywhere so I go ahead a spend $100 on something thinking I had $350 in my account, but actually I only have $50, so when the check for $300 shows up, it’ll bounce. That’s why I think having a register is imperative – between the bank balance and the register you always know exactly how much you have – no surprises. Could you forget to write the check in the register? Sure, but I’d be willing to bet that most folks who use one for that reason, specifically do remember to do that. But even if it’s not a check you write, you can “pre fill” the bills for the month and always know exactly how much you have. In Money, for example, when I look at the register, I have already “paid” all my bills for the month – whether or not they’ve come out of the bank – and when I spend other money and the register is updated with the bank balance, it’s accurate for what I really have left after all is said and done. I know that you said you will be adding a register and I’m glad of that because like ClassPro said, being a Money user all these years and having both – the register and the daily bank balance is what I like and need – a product that won’t do both won’t work for me… and quite frankly I’m surprised that there aren’t more out there that will do both.