Time for a mint?

How-To-Make-A-Budget

I’ve been having a lot of conversations recently about budgeting—not because our clients are awful at it, but because it is helpful to get a handle on how much things cost every month when we are working on planning.  For those starting out, it is helpful to know how much those nebulous categories of groceries, fun, travel, clothes, etc. cost so that we can assess where there may be some untapped potential to save money for an emergency fund or retirement account.  For those nearing retirement, it is useful to know exactly how much money needs to be deposited to your checking account every month to cover the expenses of the life you want to enjoy.  Without this number, it is hard to know the retirement “paycheck” that we need to generate from your assets or income sources.

Back in the olden days, figuring up your monthly expenses was quite a chore.  Weekend mornings were spent entering receipts and checks on ledger paper or excel spreadsheets.  Growing up, my dad would sit at his old roll top desk every Saturday morning with a pile of receipts from the cash expenses and the check book and dutifully enter every…single…transaction in Quicken.  It would take him hours and make him grouchy—we all knew not to ask him for anything during or after “budget” hours. 😊

Nowadays, there’s an app for that!  In fact, there are many apps that make tracking your expenses a breeze.  One of our favorites is Mint.com, but there are many others available—just check the app store and we are certain you will find one that works for you.  Most of these personal finance apps work the same way—using military grade security, they log into your bank accounts and credit card accounts and securely download the transactions.  Then, they automatically categorize your expenses to the best of their ability—i.e.  Wegmans expenses are categorized automatically as groceries, Exxon expenses are gas, etc.  So, most of the hard tracking work is automatically done for you.  In order to get the best data, we recommend spending about 10-15 minutes a week to categorize some of the trickier expenses (like Target or Costco—goodness know what you spend there—could be clothes, groceries, gifts, furniture, and so on…), but otherwise these apps are pretty pain free.

Once you have a good idea of where you spend your money, you can use that figure to plan to save more, start a college plan for your kids, buy insurance that is needed, get an estate plan in place, or figure out a retirement income plan.  The possibilities are endless once you have a good handle on how much you need to live!

One other note—there are not just great apps for tracking your expenses—as we wrote in She! magazine. Below are some of our other favorite personal finance apps:

  • Level Money – Level Money takes an interesting approach to budgeting. Like Mint, it tracks your transactions, but rather than comparing them to your budget, Level Money gives the amount of spendable money in your account for the month…and for the day.  This makes it very easy to know when to stop spending…whether you chose to stop is the harder part!
  • Acorns – Based on the premise that every mighty oak started with an acorn, the Acorn app automatically invests your spare change.  Link up your debit or credit card, and Acorn rounds up your purchase to the next whole dollar and invests the difference.
  • Prosper Daily – Stay on top of your money, credit score, and be alerted about identity theft with this cool app.  Prosper Daily gives you your TransUnion credit score daily, as well as the factors contributing to your number.  The app also alerts you of suspicious activity in your transactions, as well as if any of the stores that you’ve shopped at have had a data breach.
  • Mile IQ  —  Mileage expense reports are tedious, but this app makes tacking your mileage easy.  Given that every mile driven for business purposes is worth $.54 in reimbursement (or tax deduction if self employed), you don’t want to just pass this cash up.  According to Mile IQ, the average app user generates $6,900 of reimbursable or deductible miles annually!
  • Your Bank’s App – Banking apps have come a long way—many of them track your expenses, give you budgeting advice, and allow you to do simple transfers of money or deposit checks.

 

 

 

Time for a mint?
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2 thoughts on “Time for a mint?

  • March 28, 2017 at 9:09 pm
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    Not sure why you didn’t take the opportunity to promote Meridian mobile app. It may not be as functionally sophisticated as those you mentioned, but it has helped us keep our budget top of mind rather than once a year at tax time. Thanks & Cheers.
    As I remain, always enjoying your Blogs.

    Reply
    • March 30, 2017 at 2:13 pm
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      Great point! The Meridian app, for the exclusive use of our clients, is built using the same secure account aggregation as mint.com-—we wanted to give our clients a tool to be able to see and track their entire financial picture in one place. We are glad you find it helpful!

      Reply

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