Personal budgeting software provides key features for money management software that is dedicated to setting up, managing and tracking a household or personal budget. These tips will help you choose the best budgeting software.
1. Flexible Budget Categories
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Categories are used to define income and expenses in budget software and are the foundation on which you will build your budget. Be sure the budgeting software you are considering has flexible categories that you can edit, delete or add to. Avoid budget software that locks you into a default set of income and expense categories.
2. Income and Expense Fluctuations
Everyone has some fluctuating expenses, like heating bills that are higher in the winter, and many people do not work on salary so income changes from month to month. If you need to work with fluctuating income, it is very important that the budgeting software does not require you to enter the same monthly amount for income. While budgeting software that allows for monthly fluctuations in expenses is easier to use, you can allocate a monthly average expense amount over a year if you like budget software that requires you enter a set amount for expenses. Just be sure to sock away unspent funds in the months where spending is lighter to cover months when bills are higher.3. Need to Use Envelope Budgeting?
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Envelope budgeting is a great way to work with fluctuating expenses. Software with an envelope budgeting feature rolls unused funds in spending categories forward to the next month. Envelope budgeting software should also automatically distribute paychecks among the budget envelope categories.
4. Budget Reports
The budgeting software you choose should have some fundamental budget reporting at the very least. You should be able to determine how well you are following your budget on a monthly, quarterly and annual basis. If you plan to monitor your spending very closely, be sure the software offers weekly reports or a real-time dashboard. Basic budget reports show the budgeted amount, actual spending and the difference between the two. Consider whether you will want to print budget reports and look for that feature if you need it. Some software only offers onscreen reporting.5. Budget Security
Data encryption is a must if you enter account numbers or other identifying information into the budget software or if you download transactions. Read the privacy or security statement, which should be published online. Do not use software with no privacy or security statement.- Security is not an issue when you set up accounts with generic names like Checking or Master Card and without account numbers or personal information. Even if your data were hacked, there would be no way to steal your identity or your account numbers.
- Passwords: If budget software doesn't let you set up a password for access, set up your computer with a password when it starts up. Or use online budget software, which always requires a password (don't use online financial software without a password!).
6. Keep Your Data
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Most budgeting software will let you export your data to a CSV file or another file format that can easily be read by spreadsheet software. This feature is particularly important if you use budgeting software that also allows you to track transactions in various financial accounts. If you decide in the future to use another budget software or personal finance software with more features, or you want to analyze spending in a spreadsheet, having your data in CSV or QIF, or another format will save hours of data entry.
7. Easy Budget Set Up
Because you will not set up new budgets frequently, ease of set up in budgeting software is not as important as other aspects are. You do not want budgeting software that is difficult to set up, either. The best way to determine how easy budget software is to use is to download a free trial of the software, and most budgeting software offers a free trial.If you want to experiment with budgeting scenarios, be sure that what-if scenarios or saving an existing budget while editing a copy is supported. If you will design a personal budget and a budget for a small business, the software must support multiple budgets.
