I have been using Microsoft Money for a few years and I have to say using a software to keep track of expenses is really helpful. I put in all my financial accounts, whether it’s banks, credit cards, investment banks or loans, and I keep track of all the transactions on each account. The best part of Money is its reporting features. I can run a report to see how much I spend each month and in what categories or track my net savings over time.
Money is fairly easy to set up. After you install the software, it walks you through to set up all your financial accounts. You can customize the categories and payees. I suggest setting up a cash account which you will use to keep track of your day-to-day cash activities. This way you know where your dollars are going.
The only downside to Money is that if you don’t keep your activities updated, you’ll defeat the purpose of using the software. When I started using the software, I didn’t update my spendings frequently and there were times I forgot about it. That caused a huge gap in the time periods and my ending balance for each account. To sync the balance, I had to put all the difference in a category called adjustments. This kills the accuracy of my reports when I want to see how much I spend each month and on what.
Therefore it is important to update your software often. I make it a habit that I put in my daily spendings and it doesn’t take that long once you get used to it. Also, I have my credit cards and bank accounts on electronic update so transactions from those places are electronically downloaded to my software.
Money also has a tax calcuator. I entered all my income information and my tax payments. It lets me know if I’m withholding enough and if I should expect a refund. There are also other very nice features, like loan payment calculator and investment tools.
Overall, Microsoft Money does live up to its expectations and has proven to be very useful for me. I have to say this is a solid product from Microsoft.