In late 2001, my husband and I were newlyweds. He had just graduated from college and was working a temporary job to make a few bucks until he found a “real” job. We were living in the small, 1-bedroom apartment that was mine before the wedding, and we were building a new house. We were living off my modest income and putting all of his into savings towards the down payment. I look back on what I earned then, and I can’t believe I made it work! We didn’t have a lot, but we lived within our means & were happy.
However, with the looming home purchase, and knowing that our mortgage would be about 3.5 times what I was paying for rent, we needed a budget! We had several months to figure things out since we were buying in a neighborhood and wouldn’t settle until the house was complete (vs. the home we live in now where we bought the land and paid a construction loan while it was built.)
I bought Quicken, but I didn’t make a budget right away! Instead, I began by entering all money spent and categorizing it as best I could. After a few months, I was able to see where our money was going, how our new expenses would fit in, and where we could trim the fat.
The Quicken software was a fairly small investment in the grand scheme of things, and over the past 10 years, I’ve upgraded only a handful of times. They seem to come out with a new version every few years, but I don’t upgrade until they stop supporting downloads & the like for prior versions.
Speaking of downloads, if your bank has this feature available (seems most do these days), you can simply download your transactions from their website into Quicken!
The 2008 upgrade brought the ability to scan a document and attach it to a transaction too. So as I download transactions or pay bills, I simply scan the receipt or statement to go along with it. This has come in extremely handy for me many times over!
There is a bit of set-up time involved, but once you’ve done it, it’s a total breeze and much easier than paper (in my opinion.) I have all of our assets listed, along with any associated loans. Quicken will even calculate your loan payments and amortize the loan for you! Set up your paycheck by category (state tax, federal tax, social security, health insurance etc.) and it will enter them for you. You can use Quicken’s categories and also create your own. It knows which categories may affect your taxes, and you can import the data into Turbo Tax at tax time, or view your tax situation at any time.
I have all of our bills listed, and I elected to list the “due date” as when I typically receive the bill, rather than when they’re due. That’s saved me a few times when the bill didn’t arrive on time! Quicken will also show you what money you have left after those bills are paid, and what your lowest balance will be before the end of the month.
Of course, you can set up a budget, and within the setup, you are able to analyze your prior spending. You can set up reminders to tell you when you’re nearing or have exceeded your budget for any given category, and it will show up on the home page with other alerts. You can view a pie chart of your spending by category, and see what % of your money goes where.
The planning center takes into account your dependents, assets, loans, retirement contributions, tax & inflation rate and yearly living expenses. You can plan your savings, as well as seeing if you will have enough money to see you through retirement. You can also plan for events, such as home purchase, college tuition and more. It allows you to easily see other outcomes by changing “what if” situations, like what if I change my lifestyle, save more, sell a home, live longer etc.
I love how easily I can search transactions. Although you only get out what you put into it, if you take a quick second to use categories & put brief info in the memo fields, you have everything at your fingertips. I was writing a post about glider rockers & I was able to search for the 2004 transaction when we bought the one for my daughter! We donated my husband’s car last year, and when I was doing my taxes, I was able to search for all expenses for that vehicle. I also accidentally viewed the amount we’ve spent on Auto:Fuel (gas) since 2009 and almost fell out of my chair. Then I got curious, and within minutes, I found out that in 2002, we averaged $15/week per car for gas. In 2011, that same figure was $50!
Although we’re not wealthy, I credit Quicken for helping me stay organized and on top of our bills. I always know where our money is going, and I don’t have to stress about missing a bill or losing paperwork! I will continue to use it, and I can’t imagine life without it!
Of course, I also learned that since I’m so dependent on it, I need to back it up regularly. When I first started using it, I was able to back it up to a CD-R. My file is so big now with 10 years of files and scans (can you imagine what all that would look like on paper?) that I am using an online backup service.
Do you have a budget? How do you handle your budget and bill payment?
This post is not sponsored, approved or endorsed by, nor affiliated or associated with Intuit, Quicken or Tubrbotax. I purchased the software myself at normal retail prices. I was not asked to write, nor was I compensated for this post. All opinions are my own.