Anyone who’s as…intemperate as I am about spending money will have thought a time or two about figuring out where it all goes. Or more specifically, about tracking expenses and generating statistics, spotting trends, et cetera, et cetera.
Back in the dark ages, we would do this by keeping up our checkbooks, or even using full-blown ledgers. A little later on, we’d maybe use spreadhseets on our computers. Until very recently, we’d use specially-designed personal finance software like Microsoft Money or Quicken. Now, these last two options were by far the most powerful we had at our disposal.
We could download financial statements from our banks and credit cards, upload them into the software, and with a little* work on categorizing expenses, Money or Quicken would make all these pretty charts and graphs that we would then study and presumably use to better our financial health. Simple, right?
But wait. Back up. Download, upload, categorize. Three small words for one gargantuan task. Even if your accounting software can connect directly to some of your financial institutions (but not, mind, all), the categorizing—oh god, the categorizing—still remains. You have to go through literally hundreds of transactions to designate this one as grocery shopping and that one as your monthly cell phone bill. Only then can the software perform its magic. And you have to do this for every credit card and bank statement? Thanks, but no thanks. I mean, I’ve got 7 or 8 credit card accounts, and several banks handling my checking, savings and retirement accounts.
The activation energy required to use this accounting software is so huge that every time I try to use it, I give up after a few days. If only there was an easier way…
I discovered (OK, I was told) last week that there is an easier way. Mint is an online version of these desktop personal finance applications, with the important distinction that it does all the work for you; all you have to do is put in the login credentials for a supported financial institution that you use (and with a stable of 5000, yours is pretty much guaranteed to be in the list), and Mint will log in and download all the history it can find. What’s more—and this is the killer feature—it’ll automatically categorize every transaction, with a very high accuracy. The first time I logged in, I only had to (re)categorize around 6 transactions, from about 3 months of data from approximately 12 financial institutions. Not too shabby.
In fact, within a quarter hour of first signing in, I had a comprehensive look at my finances, complete with pretty pictures. What’s not to like?
Mint does have a drawback in that it’s not as powerful as its desktop cousins—it doesn’t have some of their more advanced budgeting and customization features—and provides no manual upload functionality, choosing to rely instead on its vast stable of supported institutions. But the flexibility you lose there is more than made up for, IMO, by the utter ease with which you can get up and running. Great stuff!
* And by “little”, I mean “ginormous amount of”.