If you have already made up your mind that personal finance software is what you need in order to manage your money better and stay focused on reaching financial independence, then there are a few key things to consider before settling on a particular tool. It's no secret that personal finance planning requires a lot of dedication, self-discipline and motivation. If you want to see the benefits of a personal finance management tool, then you should stay committed to your task and display patience while waiting to experience positive changes in your life. No amount of technology is going to cure you of your bad habits or financial irresponsibility. If you want to succeed, then you should be honest with yourself, embrace your financial situation and exploit your money management software potential to the maximum in order to overcome your problems and improve your finances.
A personal finance software helps you proactively manage your money and plan your financial future. The below criteria will help you evaluate different financial tools and choose the optimal one:
This is probably the most important thing in the decision making chain. It doesn't matter how powerful or feature-rich a software may be, it's unlikely that you'll choose a financial management tool that doesn't visually appeal to you. A personal finance software should be extremely easy-to-use, with neat layout and intuitive user interface. The design should be simple, clean and non-distracting, allowing for smooth navigation and easy access to the software tools. Moreover it should exhibit consistency throughout all user interface elements. Such a software will keep the user actively engaged and focused on the task at hand. After all, the core idea behind using a personal finance software is to invest minimum time and efforts while handling day-to-day financial chores.
A personal finance software that works wonderfully for one person may not be suitable for another. Since each person has specific needs and requirements when it comes to money management, it's quite difficult to find a universal tool that would be equally fit for everyone. An optimal financial tool should be designed with flexibility in mind, making it easy to adjust the range of tools to user's individual preferences and customize the account settings. Personal finance management requires daily engagement from your part. The more flexible a software is, the higher the chances that you'll use it on a regular basis.
Functionality is one of the main things to look for in a financial instrument. Since a personal finance software is intended to simplify and automate your financial routines, it should deliver exactly what you need. Some may require a tool focused heavily on expense tracking and budgeting. Others may look for a tool that will help them to save money for financial goals and perform more in-depth financial analysis or cash flow forecast. A feature-rich personal finance software may be more challenging to use, especially for people lacking any financial knowledge. Other people, on the contrary, require more advanced tools that would allow them to analyze every aspect of their personal finances.
Reporting tools are a must for any personal finance software. They are basically the result of all your daily, monthly and yearly money management work. The ultimate goal of personal finance planning is to analyze the accumulated statistical data and receive straightforward answers to these 3 questions: how you are doing financially, where you are heading, and what needs to be changed in order to achieve your financial objectives in time. Some people perceive and process financial information more easily when presented in graphical form. Personal financial planning would be incomplete without constantly analyzing the financial data you've gathered so meticulously over the years. A personal finance software should offer an entire suite of easily customizable graphs and tables, allowing you to visualize and evaluate every aspect of your personal finances. Reports should not only provide a holistic view of your finances, but also help you dig deeper and find the root of your financial problems.
It goes without saying that security is an extremely important aspect in any personal money management software, especially if it runs online. Ideally, registration should be completed in a virtually anonymous way, without requiring any personally identifiable information from user. Moreover user's interaction with the personal finance software should be at all times carried out via secure SSL encryption protocols. This will ensure that your financial data is protected against any unauthorized access or misuse. Tools for personal finance management and budget planning may employ enhanced security practices to safeguard users' data.
6. Import & Export
Many people, before switching to personal finance software, most likely kept track of expenses and maintained a household budget in Excel spreadsheets. Losing all this historic data would be a pity. Therefore it's imperative that the financial tool you decide to use supports import capabilities from various formats. Data archiving is equally important. In the case of online personal finance software, all your financial information is stored in your account. However you may have access to historical data going back only 1 or 2 years. Therefore the possibility to make regular backup copies of all the information you deem relevant and export them to your computer would be quite handy. If you are using a personal finance management tool for the first time, make sure that it supports data export. This feature may become critical in case your software is discontinued in the future or you decide to switch to a different one.
There are 2 main types of personal finance software: online (web services) and offline (desktop programs). When deciding which financial tool to use, you should take a moment to consider the pros and cons of each type. The convenience of online personal finance software is that your account is not tied to a specific computer. You can quickly access your financial data from any device connected to Internet. For convenience, most online personal finance management tools offer sleek mobile applications for smartphones and tablets, that allow you to quickly record and track your spending on the go. Moreover you can have all your data securely synchronized across various devices, which is an additional bonus.
8. Customer Support
And last but not least, an optimal personal finance software should offer professional customer support via email system, request forms, video tutorials, online forum, comprehensive Help/F.A.Q. sections, etc. Even if the personal finance software runs smoothly and is easy-to-use, it's still good to know that you can always rely on timely assistance in case of any technical issues. The possibility to interact with other money management software users in order to share tips and advice is another advantage.