This is not your typical “how to create a family budget” article.
You need a budget! Okay, I’ve said it and we can move on. As CPA’s, filing tens of thousands of tax forms each year gives us some pretty unique insight into the financial management habits of our clients. I won’t judge, but many of us would benefit from a personal or family budget, so we can enjoy today while still saving for the future.
Thanks to technology, budgeting is no longer an overwhelming chore
Budgeting and financial management used to be a major time-consuming hassle, but those days are over. Tools like Mint changed the landscape, and today many people even use the “f” word (FUN) to describe their experience using web-based apps to create and manage a budget.
Some cool tools to help you create and manage your budget
We scoured the internet (for a couple of hours) to find examples of budgeting and financial management tools and apps that are low-cost, easy to set up and use, and allow you to learn by doing, rather than reading:
- PocketGuard. This is a bare-bones app that helps you create a simple budget and then manage the budget by creating “pockets” for essential and non-essential spending. Core functionality is free, but the full app will set you back $4 per month.
- YNAB. Also known as You Need a Budget, this web-based tool (with phone app) helps you build a plan to prioritize and spend money as you earn it. There is not automated linkage to financial accounts, so it takes a few minutes of maintenance each month. YNAB costs about $5 after a free 1-month trial.
- Mint. Owned by Intuit, Mint is more of a personal financial management tool, allowing you to budget as well as pay bills through the web or phone app. You can link it to your bank accounts to automate tracking. It’s free, but charges a fee for payments by credit card.
- Mvelopes. If you’ve ever used the classic envelope approach to budgeting, this app takes that concept into the 21st You link your financial accounts and allocate money to different budget categories each month, then plan savings and spending accordingly. The basic package is $4 per month after a 30-day free trial, or you can pay more for access to a library of financial management tutorials.
- Not as cool as the others, but Microsoft Excel offers a number of very simple (and free) budget templates. Click here to view and download the most basic one I could find. Click here for another template that can be updated each month to show budget vs. actual expenses. Prefer Google Sheets to Excel? There are a number of templates available as well.
Choosing the best solution for your own needs
We researched the examples listed above through a variety of reputable publications, including the Wall Street Journal, Forbes, Kiplinger, and Consumer Reports. Please make sure you thoroughly investigate any budgeting or financial management tool (including security and privacy) before you start using it.
Once you find the one you think will work best for your needs, dive in and use it diligently for the first month. That will help you develop the habit of using the tool while you’re still under the free trial. If you like it, make the small investment if applicable and keep going! Please let me know how things work out.
Don’t forget to share this article with your kids!
Neal Bach, CPA