All About (Financial) Automation

Putting your finances on auto-pilot: a great idea or not so much? Over my past twenty financial years I’ve attempted a lot of different automation strategies – from pay yourself first and not worrying about the rest, budgeting and tracking every cent, using apps and writing it down.  Lets take an in-depth look into some of the options available, the pros and cons of financial automation, and what I use for my tracking. Spoiler alert – this is going to be one of those cases where personal finance is personal. You need to do what works for you, and not what someone else tells you to do. Particularly if said person has an affiliate relationship with a financial automation company.

So lets take a look at the various automation approaches first.

The Main Automation Approaches

First and foremost, I’m going to say that I have no affiliate relationships with any of these providers, and all opinions are my own.

I’ve been in the personal finance scene long enough to be familiar with the various approaches to financial automation. There are two main types – automating tracking your spending and automating tracking your net worth. Sometimes you’ll find tools that do both at the same time.

Here’s a run-down of the main various automated products out there, their costs, and their capabilities – and some of my personal comments from having used these tools. For those that already know about the tools, I’ve tried to include some interesting facts for you. Since I don’t have financial relationships here, I’m going to talk about all of them instead of focusing on ones that pay me money.

Mint – One of the best known trackers, Mint has been around for quite a while. It’s owned by Intuit, the same company that owns Turbo-Tax. Mint’s been around since 2007 and was bought by Intuit in 2009. It tracks your bills, spending, and accounts (net worth) for you automatically. The app is pretty easy to use, and their sales pitches aren’t too bad. Their budgeting and spending trackers are pretty straightforward – you create a budget, they track what you spend in each category, and tell you where you’re over/under. Cost: Free to use.

YNAB, or You Need A Budget – YNAB is, at its core, a budgeting tool. They have some unique thoughts about budgeting that can work well for some people – or drive some people crazy. It goes way beyond making a simple list of income and expenses. Their perspective is to assign every dollar a job, and age your money. You can read more about their “rules” here. Cost: Free the first month, then $6.99 per month as of this writing (you can check here to see if pricing has changed)

Quicken – Ah Quicken, the grandfather of financial tracking. Quicken was the first ever software product I used to track spending and accounts. They have a more complex suite of product offerings, which you can check out more about here. They seem to be using the Turbo-Tax style model of making you buy up to high levels (read: more expensive) of software to access more capabilities. Which, frankly, only makes sense as a business model. I used to use Quicken in the early 2000’s but stopped in favor of another tool I’ll talk about later. Cost: Ranges from $34.99 per year to $89.99 per year as of this writing (you can check here to see if pricing has changed)

Every Dollar – A budgeting app created by Dave Ramsey (of Total Money Makeover fame), Every Dollar is a pretty straightforward income and expense tracking application. The user interface looks pretty easy to use, and it’s aligned with Dave’s philosophy to give “every dollar a job”.  Cost – It’s free to use if you want to input your information manually (which can actually be helpful – will explain in a minute) or costs $99 per year if you want to automatically have your transactions pulled.

Personal Capital – So this is likely the program you’ve seen most in the financial community recommending. It has a pretty good user interface, and I gave it a try. But it gets a big thumbs down for me because of the annoyance factor. Cost – A sales call to pitch you on their investment management if you have above a certain amount of assets connected. And relentless pushes to connect more accounts if you try to just connect your checking/credit cards (ask me how I know).

Also if you’re with a company like Vanguard or Fidelity, they often have an option to pull in outside accounts for you. So rather than using a separate tool, you can add outside accounts to their sites.

All about financial automation

Downsides of Automated Trackers

There are a few downsides to pretty much any option out there. Here’s the top four things that have annoyed me in my  personal experience with trying to use some of the automated tools.

 

  • Too much automation – If you rely on your automated tools to pull in everything for you, you might not pay attention to where your money is going. When you have a more manual approach, you pay attention to every dollar going in/out. This might not be an issue for you if (1) you have a high income, no debt, and don’t need to watch every dollar or (2) you check the app every day.

 

  • Clunky way of dividing transactions– This is where you want to create a budget category for, say – food, household supplies, pets, and home decor. Guess what a trip to Target means? All four at once (plus probably 1-2 more, at least if you shop at Target the way I do). Personally I find it annoying to re-categorize transactions like that. And I do a lot of weekly shopping at BJ’s, which results in the same thing. Now I understand why these tools can’t do that for me – they don’t know how much of Target was pet food vs. hamburger – but most tools just have a clunky way of dividing transactions.

 

  • Not pulling in all accounts – This is the case if you have, say, paper savings bonds. Or perhaps accounts with a very small bank/credit union that doesn’t have the ability to connect. I believe Treasury Direct accounts are also not really able to connect to anything. Perhaps you have real estate, or something else out of the ordinary. The automated tools usually let you track it manually, but some make it easier than others.

What I Use

Excel.

Yes, despite working in IT, and despite having all these awesome automation products available, I still go back to my trusty Excel. I love Excel. Not only does it let me track manually, but it’s been my go-to tool of choice for years. I can look back a decade plus and see how my accounts have changed as the years have gone on. For budgeting, I like the awareness that manually inputting my transactions gives me. It only takes about 5 minutes a day, because I only have one checking account and one credit card (that I don’t use for much). I log in, put in my transactions, and done!

For my net worth calculations, I only do them quarterly. Updating all my accounts doesn’t take much time at all – maybe half an hour to an hour. Yes, it would be easier if I had an automated tool and only put in a few accounts manually. But I still like my spreadsheets.

What do I do with the information? Create pivot tables of all my spending by personalized category. Create pie charts and graphs of the change in accounts over time. What can I say? I’m a money nerd.

Let Me Know

What are your favorite financial tracking tools? Any great ones that I missed, and should give a try? Let me know in the comments!

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chiefmomofficer

IT professional, MBA, working mother of three, avid reader, geek and personal finance nerd

21 thoughts on “All About (Financial) Automation

  • February 19, 2018 at 12:33 pm
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    I love using automation for setting up the basic systems… then following them like a hawk 😉 I use Mint as the collection/snapshot of our accounts, then I use Excel to track our Net Worth. I also try to automate our savings via direct deposit (no thinking = less opportunity to mess up or skip!).

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    • February 20, 2018 at 1:37 am
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      I do automate savings-that’s my favorite kind of automation! It’s just the tracking tools that I find a pain 😑

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  • February 19, 2018 at 12:51 pm
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    I have a half cooked blog post that’s been sitting in my drive for months. We automate nothing (except our cell phones because we save $5). If I let myself go on autopilot, I stop questioning things. Great roundup and reflection, Liz!

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    • February 20, 2018 at 1:37 am
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      Nice! Can’t wait to read it Penny

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  • February 19, 2018 at 1:34 pm
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    Automation help a lot for saving and paying my weekly mortgage. I am using YNAB to look at every transaction I do and look back to see where I can cut.

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    • February 20, 2018 at 1:37 am
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      I’ve heard a lot of people like YNAB-and a lot of people hate it. Not a lot of folks in between, from what I’ve seen

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  • February 19, 2018 at 2:10 pm
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    Um, my name is Laurie and I think I have a tracking addiction. I use YNAB for budgeting, Personal Capital for investment tracking, and Excel for spending tracking as backup. I like having the different interfaces because they help me see my spending and investing differently. Plus, tracking is my happy place! So yeah, don’t do what I do! Way too much work!! Haha! 🙂

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    • February 20, 2018 at 1:38 am
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      Wow you sure do have a lot! I’d go crazy. 😂

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  • February 19, 2018 at 11:39 pm
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    Excellent post! I’m a little too detail oriented to leave a few things up to automation. I’m like you and have to detail everything on an Excel spreadsheet!

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    • February 20, 2018 at 1:38 am
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      Love it! A fellow Excel fan 😃

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  • February 20, 2018 at 12:37 am
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    I use a spreadsheet I’ve been improving since college. I briefly tried mint, but didn’t like not being able to refine categories the way I want.

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    • February 20, 2018 at 1:39 am
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      Same here, that was one of the things I didn’t like about it

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  • February 20, 2018 at 7:43 am
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    I also use excel, (well actually the free version Libre Office) and religiously update every month.

    I’d love for a great aggregator like Personal Capital or mint to come to the UK..there was one I tried a few years ago, but it only included a few accounts, and the lag in updating balances was really confusing.

    As for expenses, I used Toschl, which is a free app/webbased tracking system. I do sometimes wonder what they are doing with my data, but I hope my high savings rate will skew it….when they see my largest expense category is investments!

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    • February 20, 2018 at 10:29 am
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      Nice-it’s good that I’m not the only Excel user out there

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  • February 20, 2018 at 10:09 am
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    Excel here as well. Great post! I’d like to add one “con” of some of these automated tools that no one seems to mention, but to me is a huge con. You have to give Personal Capitol or Mint all of your usernames and passwords! I have some “ethical hacker” friends and the stuff they tell me about breaches and hacking scares me. As my one buddy said about tools like these “It’s not if they’ll be hacked, but when”

    So “when” Personal Capitol gets hacked, whoever gets in has ALL of your usernames and passwords. No thanks. Call me paranoid but that sounds like too much of a security risk. My Excel file is easy, customizeable, and I constantly learn new Excel tricks by tweaking it so it’s a learning tool as well. Win for me 🙂

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    • February 20, 2018 at 10:30 am
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      Love it! And I agree that cyber security is something that’s important to me. I have two factor authentication on most of my accounts, and strong passwords. I don’t really want to give those out.

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  • February 21, 2018 at 12:47 am
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    I use a combo of Personal Capital and Excel. For my investment accounts, I put them all in PC so I can see all in one snapshot how it’s doing. That way I don’t have log on to each financial institution. Makes it much easier and plus PC has nice features like the ‘retirement tracker’ to see I’m doing on the road to retirement.
    For excel, I do a personal income statement on a monthly basis. I enter all of my monthly expenses and income on there and create graphs and pie charts to get a better visual of my spendings. I know you can do that on PC too but I kind of like doing this portion of my finances on Excel and I don’t want to put all of my accounts onto there.

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    • February 21, 2018 at 12:49 am
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      Nice! Has Personal Capital given you a sales call, or do you not connect enough accounts to trigger it?

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      • February 21, 2018 at 12:57 am
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        They did call me when I first linked my investment accounts. It was trying to give me advice on my investments though it wasn’t very good. Basically told me that it looks good and I should link all of my accounts on there. Honestly, I don’t think they really look at my accounts and really wanted to give me their sales pitch. They haven’t called since!!

  • February 24, 2018 at 2:23 pm
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    I check my accounts at least weekly, but I signed up for a promotion with my bank that I don’t remember and got $20. I’m guessing it was to keep a minimum in the account, and it was probably something I do anyway so I hit the accept button, but I don’t know.
    I did sign up for Personal Capital & did get the sales call. It was neat to see the points where 401k and other accounts overlap, but I’m ok with my allocations at this time.
    Thanks for an informative break down CMO!

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    • February 24, 2018 at 3:45 pm
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      Nice! I love when random money I forgot I was getting shows up in my accounts. It’s like an unexpected bonus. 🙂

      Reply

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