Recently, Jesse at PF Firewall wrote about his top 14 personal finance tools to help out different aspects of your finances.
I looked through the list and had some experience with some of the products, but for me a simple Google Doc spreadsheet is my favorite money tool. It’s what I go to every month to track my net worth, view monthly changes, and organize my accounts.
No online product has replaced it yet, and I can’t picture a future without using it.
Tracking my finances monthly has allowed me to visualize the changes of my money like never before. Up until 2 years ago, I had just casually checked my checking account balance and as long as there weren’t any huge changes, I didn’t pay much attention to it.
Now, I keep track of monthly gains and decreases, and I can see exactly how much I’m saving from month to month.
This makes saving fun and addicting. It’s a challenge to keep my bottom line going up, and I now look forward to the 1st of every month when I total my money.
Here’s why a money spreadsheet will help your finances.
It’s Not Automated
Sites like Mint.com pull your information from different sites and provide you a picture of your overall finances. Sounds great, but the automation isn’t always as perfect as it appears.
Mint constantly gives me an error saying it can’t sign in to certain accounts and ING has notoriously denied Mint its transaction history during the day. It quickly turns into a huge headache when I just want to check to see if a transfer went through.
Meanwhile, my spreadsheet is available 24/7 with no hiccups.
I also use the monthly checks to search for any suspicious activity and to make sure they are working correctly. It keeps me engaged with my money without being overwhelming. I only open the spreadsheet on the 2nd of every month and that’s it.
Automation is great if it works correctly, but sometimes simple is the best option.
You Understand Your Money Situation
Since you’re manually putting in the numbers, you’ll understand your money better. You’ll actually see the changes and this will promote savings and smart money habits in your life.
If you’re in a dire money situation, stick with the monthly updates! It’ll be difficult to see the numbers fall or barely go up every month, but keep with it and you’ll see the results you want. If you can commit to keeping track of you finances, you have the ability to beat your money situation.
It’s easy to sign into Mint and gaze at your money, but it’s more beneficial to do it yourself and see the changes.
Occasionally I’ll want to alter my records by adding an account, deleting an account, or adding a new way of tracking my expenses. With the spreadsheet it’s simple and I don’t have to worry about changing records within some database. Once I have all of the initial organization set up, it’s simple, and changes can be made almost instantly.
When you have your money being tracked by a website, it’s more difficult to get the customization you want for your money. The spreadsheet is as bare as it gets, and it allows the individual do as they please.
Some people don’t trust keeping their finances online for fear of internet pirates. I don’t mind sharing my information with Google and I feel like it’s safer with them than on my computer which could crash or be stolen. If you don’t like Google Docs, try any spreadsheet application you have available.
Either way, the moment you start documenting your money will change you financial life forever. You’re taking an active step to become more involved with your money and there’s nothing but good things to follow.