A great number of people have no idea where to begin to get out of debt or start saving for the future. They’ll check their bank accounts, maybe balance checkbooks. Here’s the problem – if you don’t have a full picture of your financial health you can’t make informed decisions about what to do with your money or get an accurate gauge of where you’re at. This step is more important than any other – this is what you should be doing first! You can’t budget, properly paying down debt, making decisions about savings or track your efforts in being more frugal if you don’t have a handle on your cash flow.
This article is for true beginners to get started tracking their accounts, bills, etc. If you already track your cash flow, net worth, expenses and savings – well good job. Let us know if you have any suggestions to share, or maybe try out some of the alternatives here. There are always new services springing up to help people out here.
The first step in getting you financial house in order is to gather up all your information into one place. Using your bank account for bill pay and logging in occasionally doesn’t count – unless you don’t own a home, have a 401k, IRA, bills that don’t get included in their bill pay system, credit cards, or other bank accounts.
Personally, I recommend using Mint. This is a free site from Intuit that lets you add your credit card accounts, bank accounts, loans, mortgages, homes, brokerage accounts, etc. It will automatically update the balances on each time over time and track the full details of transactions. This is the site I go to every day to keep track of my finances and categorize my transactions. Over time you can add rules to get it to recognize that when you go to certain stores they should get categorized as say Restaurants. They also have sensible defaults which typically are correct.
There are a whole host of other features they provide – like generating a budget, setting bill alerts, alerting you when you have unusual spending in categories, alerts for large deposits, and much more. But the most important part is that you can track all your accounts in one place and see the month to month expenditures, income and net worth. Once you’ve had it hooked up for a while ti can be very useful to track these over time so you can get a good idea if you’re doing a better job in saving more of your income, and as a great motivator to see your net worth climb.
The biggest weakness for me is that some major credit cards don’t play nicely with Mint, and Mint’s investment section is pretty lacking. We’ll visit competitors to help fill the investment gap in a later article.
Another website that I have used that is a fairly direct competitor is Personal Capital. It’s much in the same vein as Mint, where you can enter in your accounts, get balance, see your net worth, categorize and track individual transactions and more.
Some notable differences do crop up between the two:
- Mint will update your home worth over time using Zillow estimates, while for Personal Capital it’s a fixed value you provide. You can also fix the value at Mint, but I like that it gives a market estimate.
- Personal Capital does a better job on it’s investment tracking with an asset allocation detail, checkup, and fee analyzer.
- Personal Capital is a little more hands on. They may call you to try and schedule time with an “investment advisor”. I think this is how they try to make money. I am told that their fees are lower than typical advisors, though I haven’t tried. They also use $100,000 in assets as a cutoff point for using this service (meaning if you have less, they don’t offer it and likely won’t try calling you).
- Mint tries to make it’s money by offering suggestions for services, credit cards, brokerages, etc. based on your transactions and accounts (i.e. if they see you have a car insurance payment they may suggest an alternative insurance company). They get referral fees when you try out their recommendations. It’s pretty easy to just ignore if you’re not interested.
- Yodlee MoneyCenter – Yodlee used to be the company that provided Mint’s bank integration behind the scenes. Mint now uses Intuit’s own system, but it looks like Yodlee now has their own offering to compete with Mint. I haven’t tried it myself, so I don’t have much details to go on here.
- PocketSmith – Looks to do some neater things with forecasting your cashflow over time. This is a “freemium” site which gives you some basic features for free, but charges a monthly fee if you want things like live bank feeds (you do), longer history or projection windows, more accounts, etc.
- Buxfer – This does look to track expenses and balances, with auto-syncing with banks. The interface looks pretty simplistic to my eye.
- Check (formerly PageOnce) – This is an app that tracks your balances and looks like it offers bill payment through the app itself. This seems more geared towards bill payment than tracking cashflow, transactions and net worth.
- Manilla only partially fills the bill here. Manilla doesn’t track all of your savings, investments and individual transactions. Instead it’s a sort of centralized expense and bill payment website. It looks interesting for tracking bills in a much more robust way than Mint’s integrated bill tracker – but without all the transactions, bank balances, etc it just doesn’t cut it for our purposes.