Logan Flatt
PowerWealth.com

1. The ad icons placed on your desktop are annoyingly commercial, but all you have to do is drag them to the trash can and they’re gone forever.

2. Quicken, Intuit, that is, does NOT communicate with your financial institutions when you download transactions. You are logged directly into your bank or investment firm, and IT downloads to your computer.

3. When you upgrade to a new version, your data is converted and is entirely accessible in the new version. It most certainly can read your data after the conversion.

4. Although Intuit only supports a version for three years (and this partly because the banks themselves are constantly changing download protocols for security reasons, not just Intuit,) you can continue using an older version of Quicken…you just may not be able to download transactions and would have to enter them manually.

5. I would imagine that a spread sheet would take almost as long as Quicken to set up the first time, work out all the formulas and enter back data. Many people dive into Quicken for the first time one account at a time – that is, they set up their cash, credit, and savings accounts first, get them under control and then move on to the more complex investment accounts.

6. It can be hard to reconcile your Quicken checking and savings accounts the first time, if you try to do so from the date on which you start using Quicken. Your bank statement will contain older transactions that have to be entered before you can balance the account. Also, the daily balance shown when you download will NEVER be the same as your paper statement. You can reconcile to either one, but NOT go back and forth between the two balances. i.e., if you start reconciling to the daily balance with downloads, you can’t go back to the paper statement and get it to balance later.

-T

Thanks.

Far, far more than 5 hours, I’ll bet. Good review of the features though.

I love the site and have been faithfully following for some time now. I was wondering, would you mind making available a simple sample version of what you use in excel? I am an excel lover/junkie when it comes to personal finances and prefer it over the other software, but I’m always looking for ways of improving the system I have created. I’m just curious to see what you do. Thanks!

Being able to track items in depth like the “food” example above just sounds like it might pull me into being more OCD about my money, which is something I decidedly do not want. Even net worth calculations are to me just a motivational and comparison tool, and don’t need to be exact to the dollar or timeframe. I’m a great believer in keeping checking my finances simple.

I cannot recall ever having troubles upgrading old Quicken files to new Quicken releases. It’s always been a smooth transition, even across multiple crappy Microsoft operating systems over the years (my data go back to 1998). Yes, you have to upgrade every two or three years, but big deal – it’s only like $40 to $60 for Quicken Basic or Deluxe and you only spend that every two to three years. I happily pay those amounts just to avoid having to spend the time doinking with my own spreadsheet which would only lead to “analysis paralysis” anyway probably. The opportunity cost of one hour of my time makes the $20 to $30 per year a screaming bargain.

Simply put, Quicken works. I track pretty much everything in it EXCEPT for portfolio details since it doesn’t handle more complex transactions like stock shorts, options, or futures in a straightforward way. Instead, I just manually enter in balances posted to my portfolio accounts on the last day of each month. I do this so that I can track my net worth, which Quicken does just fine. I don’t need to know my net worth any more frequently than that. Since I am mostly a buy-and-hold investor (with hedging, thus the options, etc.), I don’t really need to know my portfolio balances any more frequently than monthly either.

What I like best about a tool like Quicken or Money is the ability to FORECAST my “check book” by entering in major transactions before they occur; that way, I can foresee when I’ll be short on cash and will need to move cash around to cover any shortfalls. This also helps me forecast my net worth for future periods when I know big transactions are coming up, like paying lump-sum property taxes and homeowners dues or anticipating an annual bonus.

Quicken is just a way of life for me. So is its sister product, TurboTax. I’m a fairly advanced financial guy with some fairly complex issues to deal with, but I’ve always found a way to use Quicken in a manner that works for me. I could not imagine ever using a spreadsheet to do my financial management — financial modeling of investment or financing alternatives, yes, but not my day-to-day financial management.

To each his or her own. The important thing is that it works for the person and the person uses it to effectively manage his or her finances in a way that smart financial decisions are made and dumb financial decisions are avoided.

Logan Flatt
PowerWealth.com

After I downloaded transactions from my checking account, I had to go back and tell the stupid thing what they were. After last years experiment, where I kept meticulous paper records and used Quicken, I discovered that my paper records were far easier to use. I write down in a little book medical and dental spending and charitable contributions, and keep my checkbook register in line. It may seem like double the work, but I can add this stuff as I go and when tax time comes instead of trying to remember how to get this stuff out of Quicken and then verifiying that I actually made sure the checks were allotted to the doctor or dentist, I wrote a figure in the accountants worksheets and I was done with it.

I also just got a disc in the mail with a Quicken 2008 upgrade. If I hadn’t read the package, I would have assumed that I got it free…. no… not free…not asked for either.

I dunno — sometimes, in the middle of the grand Quicken experiment, I felt like everyone drank the KoolAid but me…. I totally don’t get what’s so great about tracking stuff on the computer.

Re: 1. I was also surprised by the icons. But dumping them took 10 seconds, so it was ok.

Re: 5. Again, I had some trouble with the ING. Unlike others, I had to go directly online, log in, and then tell it to download to Quicken. But after that it seems to be working ok.

Did come across a comparison of free tools, so maybe something to check out: http://zenhabits.net/2007/05/6-great-free-alternatives-to-quicken-ms-money/

True, Quicken has some quirks. For example, I really wish the charting functionality was a bit more flexible; every once in a while some transaction downloads into the system incorrectly; and yes, the help and support documentation is about as crappy as it is in any software I have ever seen, but over all Quicken is a huge time saver for me.

For instance:

Say I’m looking at a year-to-date pie graph of expenditures in a spreadsheet program. I’m wondering exactly why “food” is 30%. In Quicken, I double click on the “food” slice and it shows me a breakdown of food expenditures per-month. One month looks high, so I double click on it. I can now see all the transactions for that month… and that I ate out 10 times that month!

As you say, I can also get a nice net worth graph. AND many other graphs. And many other reports. And I don’t need to fiddle around with spreadsheets for a few hours to get them working well and looking good.

Downloading is a major timesaver. if you have a pile of finances to track, you don’t want to spend your time transcribing numbers… or downloading csv files, and writing perl scripts to convert them so they work with your spreadsheets.

The calendar and reminder Quicken features are not bad either. It’s simple to project what finances will be like in a few months, and get reminders to look for that property tax bill.

MoneyDance (moneydance.com) has many of the same features, and they’re working on coming up to par with Quicken for graphs.

The biggest problem with Quicken is that it is crashy (both the Windows and Mac versions crash too often). This is the primary reason I’m switching to MoneyDance once it comes up to par.