If you’re attempting to do a better job of creating and sticking to a budget, there are many tools available to help you do just that. Whether you have a manual budgeting system that you’re looking to upgrade from or you’ve never attempted to set a budget before, there are an array of websites, apps and software that can help. The trick is to find a solution that you’ll be comfortable with, so you can stay committed to hitting your budget goals.
What to Look For
Some budgeting tools are very simple, allowing you to keep track of important information like multiple bank account balances, monthly spending, and monthly income. Other tools are more complex. Some break your spending into detailed budget categories, forecast your future bank account balances, and produce other types of reports to show you where each penny is going. There's no right or wrong answer on which type of budgeting solution you should choose. It ultimately depends on how much control and detail you want over your personal finances.
Common Budgeting Apps
There are several widely-used budgeting apps on the market. Here are few to consider:
• Mint. This is one of the most popular free options. It allows you to sync all of your bank accounts so that you can see multiple account balances or payments coming due on different credit cards. You can also set up categories for your monthly transactions and the app will automatically calculate how much you’ve spent in each one. This allows you to easily see where you’re at in each category during the month, and can help you identify when you’re in danger of going over-budget. Mint also regularly updates you on your credit score without resulting in a credit inquiry.
• You Need a Budget. “You Need a Budget”, or YNAB, is one of the most popular paid budgeting tools. It is much more complex than Mint and gives you the ability to plan your budget ahead of time and “give every dollar a job”. This means that you can allocate your funds to certain things before you even have the money. If you want to spend money on something, you can look directly into the category it would be coming out of to see if it fits within your budget. YNAB is accessible on a desktop, mobile device or tablet. They also offer a free 34-day trial before an annual commitment of $84.
• EveryDollar. EveryDollar works similarly to YNAB in that the goal is to plan your expenses ahead of time and stick to it. One significant difference is that EveryDollar offers a free version where you can enter your income and expenses manually. They also offer a paid version that automatically syncs with your bank account. Both versions are accessible via the EveryDollar website or mobile app.
• PocketGuard. This free tool focuses a little less on planning ahead for every expense. Instead, you enter your anticipated monthly bills and necessities and the app will provide estimates of how much you can spend on other categories while still having the necessary funds to pay for critical expenses like rent, car payments, etc. PocketGuard also allows you to create spending categories to see how much of your money is going towards each category, which can help you identify spending areas you might want to cut back on. Like Mint, PocketGuard syncs with your bank accounts so you can view your total balances in one place.
• Marcus Insight. This free budgeting and saving app differentiates itself by allowing you to link different subscriptions and apps to your account, such as your Venmo, Uber, Lyft, Netflix, and Hulu accounts. This allows the tool to automatically record those expenses, so you can easily keep track of how much money you’re spending across services.
• Goodbudget. This option has a free and paid version that digitizes the manual “envelope system”. The envelope system is very much what it sounds like – you put a set amount of money in a virtual envelope labeled with a category and when you want to spend something under that category, you take the funds from the envelope. Once the money is gone from a certain category, you are done until next month. Your categories might include things such as dining out, groceries, take-out food, and entertainment.
• Personal Capital. Created by an investment management firm, Personal Capital offers many of the same tools as other free budgeting apps. However, it also allows you to meet with a financial advisor to help walk you through your personalized budgeting plan, and discuss potential investment opportunities and retirement planning goals.
Using Software to Track Larger Expenses and Long-Term Budgets
Most budgeting tools focus on where your money is going and helps to track it on a monthly basis. However, you should keep in mind that you may also need to periodically set money aside for large expenses such as your car insurance renewal, property tax bills, or large planned purchases. When choosing which budgeting platform to use, you may want to look for one that allows you to set future spending goals, or tell you how much money to set aside each month in order to save for a particular upcoming expense.
Other Benefits of Budgeting Apps and Software
Even if you feel like you have a good handle on day-to-day budgeting, there are still benefits to using a budgeting app or tool. If you have accounts at multiple banks, syncing them so you can review everything in one place can help you to quickly spot any fraudulent charges or prevent you from missing a bill payment. Many budgeting tools can also save you time when your taxes are due by either syncing directly with your tax preparation software or providing reports you can bring to your tax preparer.
Ultimately the decision of which budgeting tool to utilize comes down to your personal needs, financial goals, and what you are most comfortable with. You may decide to use a basic tool for the time being, and switch to a more robust option down the road. Whether you’re working to pay off student loans, saving for a down payment on a home, or just wanting a better understanding of what you are spending your money on each month – a budgeting tool can help you take control of your finances and make it easier to reach your financial goals.
What to Look For
Some budgeting tools are very simple, allowing you to keep track of important information like multiple bank account balances, monthly spending, and monthly income. Other tools are more complex. Some break your spending into detailed budget categories, forecast your future bank account balances, and produce other types of reports to show you where each penny is going. There's no right or wrong answer on which type of budgeting solution you should choose. It ultimately depends on how much control and detail you want over your personal finances.
Common Budgeting Apps
There are several widely-used budgeting apps on the market. Here are few to consider:
• Mint. This is one of the most popular free options. It allows you to sync all of your bank accounts so that you can see multiple account balances or payments coming due on different credit cards. You can also set up categories for your monthly transactions and the app will automatically calculate how much you’ve spent in each one. This allows you to easily see where you’re at in each category during the month, and can help you identify when you’re in danger of going over-budget. Mint also regularly updates you on your credit score without resulting in a credit inquiry.
• You Need a Budget. “You Need a Budget”, or YNAB, is one of the most popular paid budgeting tools. It is much more complex than Mint and gives you the ability to plan your budget ahead of time and “give every dollar a job”. This means that you can allocate your funds to certain things before you even have the money. If you want to spend money on something, you can look directly into the category it would be coming out of to see if it fits within your budget. YNAB is accessible on a desktop, mobile device or tablet. They also offer a free 34-day trial before an annual commitment of $84.
• EveryDollar. EveryDollar works similarly to YNAB in that the goal is to plan your expenses ahead of time and stick to it. One significant difference is that EveryDollar offers a free version where you can enter your income and expenses manually. They also offer a paid version that automatically syncs with your bank account. Both versions are accessible via the EveryDollar website or mobile app.
• PocketGuard. This free tool focuses a little less on planning ahead for every expense. Instead, you enter your anticipated monthly bills and necessities and the app will provide estimates of how much you can spend on other categories while still having the necessary funds to pay for critical expenses like rent, car payments, etc. PocketGuard also allows you to create spending categories to see how much of your money is going towards each category, which can help you identify spending areas you might want to cut back on. Like Mint, PocketGuard syncs with your bank accounts so you can view your total balances in one place.
• Marcus Insight. This free budgeting and saving app differentiates itself by allowing you to link different subscriptions and apps to your account, such as your Venmo, Uber, Lyft, Netflix, and Hulu accounts. This allows the tool to automatically record those expenses, so you can easily keep track of how much money you’re spending across services.
• Goodbudget. This option has a free and paid version that digitizes the manual “envelope system”. The envelope system is very much what it sounds like – you put a set amount of money in a virtual envelope labeled with a category and when you want to spend something under that category, you take the funds from the envelope. Once the money is gone from a certain category, you are done until next month. Your categories might include things such as dining out, groceries, take-out food, and entertainment.
• Personal Capital. Created by an investment management firm, Personal Capital offers many of the same tools as other free budgeting apps. However, it also allows you to meet with a financial advisor to help walk you through your personalized budgeting plan, and discuss potential investment opportunities and retirement planning goals.
Using Software to Track Larger Expenses and Long-Term Budgets
Most budgeting tools focus on where your money is going and helps to track it on a monthly basis. However, you should keep in mind that you may also need to periodically set money aside for large expenses such as your car insurance renewal, property tax bills, or large planned purchases. When choosing which budgeting platform to use, you may want to look for one that allows you to set future spending goals, or tell you how much money to set aside each month in order to save for a particular upcoming expense.
Other Benefits of Budgeting Apps and Software
Even if you feel like you have a good handle on day-to-day budgeting, there are still benefits to using a budgeting app or tool. If you have accounts at multiple banks, syncing them so you can review everything in one place can help you to quickly spot any fraudulent charges or prevent you from missing a bill payment. Many budgeting tools can also save you time when your taxes are due by either syncing directly with your tax preparation software or providing reports you can bring to your tax preparer.
Ultimately the decision of which budgeting tool to utilize comes down to your personal needs, financial goals, and what you are most comfortable with. You may decide to use a basic tool for the time being, and switch to a more robust option down the road. Whether you’re working to pay off student loans, saving for a down payment on a home, or just wanting a better understanding of what you are spending your money on each month – a budgeting tool can help you take control of your finances and make it easier to reach your financial goals.