We bought Quicken Home & Business a couple of years ago. I thought this would be the missing link to solve all of our budgeting problems. It said it had this fancy import tool that would import all of your banking activity straight from your online banking. However, that required a special password and you had to pay a fee. Not worth it to me. So I decided I would manually input each and every transaction every month. The plan was to set aside one nap time per week to do it. It started out ok. But then it got a little stressful. I started getting behind and when I went to catch up, I was overwhelmed. So that led me to stop doing it. We still wanted to live on a budget, so I would frequently check our account online but it was hard to tell exactly where everything was going.
Next I tried Quicken Online. They have a system similar to mvelopes.com, except its free. Its completely online so you don't need any software for this one. It basically monitors your checking account. When you sign in, it updates your transactions and even assigns which categories it THINKS each purchase is. For the most part, its right. It knows that McDonalds is dining, Kroger is groceries, etc. But for transactions it doesn't recognize, it assigns random categories to or leaves blank. It was making my budget reports all wrong. For example, I knew I didn't spend $1000 in groceries one month! I spent a lot of time having to go in and re-categorize everything. Plus, after deciding to make sure we were being safe with our family online, we decided we didn't want any outside website having access to our checking account. Even reputable sites such as Quicken. I will say though that I liked its notification feature. You could set it up to email you if your account went below a certain amount, or if you had spent more than the budgeted amount in a certain category.
So, recently I found a new system. And it really works for us. Its quick. Its simple. There's no software to download. And no outside website involved. Most banks have the option to download your account activity. I use 2 banks (one for personal and one for business) and they both offer this option. If you click the option to download activity, it asks you to select the date range and the format to download in. So, for example, say you want to check on your budget every 2 weeks, and today is January 16. Select Jan 1-15. That will give you about a 2 week range. Select CSV as the download format. This is an excel file.
When you open the file, it shows you all the transactions in the specified date range. Here's how I use it. There's an empty column next to the "amount" for each transaction. In that spare column, I mark dining, groceries, medical, etc next to each purchase. Then at the bottom, I total each category using the SUM function. Seriously, this takes me like 5 minutes, especially if I do it every 2 weeks or less. I guess if you buy a lot of things then it might take you a little longer. At the bottom, I have all my totals for each category so I can see where we stand so far for the month. I save it as January1 and the next 2 weeks will be January2 so we can keep up the total for the month. I created a sample below. Obviously, the transaction detail from your bank download will be more detailed, but I erased my info out and placed sample info in.
There are a TON of resources, software and ideas out there on budgeting. Everyone finds something different that works for them. But if you're in search for a simple, free method that doesn't take a lot of time but ultimately gets you results, this one is great! I'm sure most people today know how to use excel and simple functions like SUM, but if you don't, feel free to leave a comment and we can help you!