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Prepare a budget and then use online tools to manage your money

Budgeting can be a difficult and arduous process. Luckily, the days of spreadsheets and handwritten ledgers are behind us. Now we have the ability to automatically track our spending, set text message alerts and review the state of our finances in real time. However with the variety of budgeting options out there, it can be difficult to identify what you really need or where the best place to start is. Take this expert advice to identify the best way to build your online budgeting tool kit to become a budgeting master.


Do have a budget

Before you sign-up for a service or use any tools, you need to already have a budget in place. Having a written budget is like having a blueprint. Having a blueprint already laid out allows you to clearly see what tools would suit your needs best. Just as your budget will be unique, so are the tools you need.

Do know what you want

It can be a daunting task to pick budget tools, especially when you don’t know what you want. Once you have a budget, make a list of features that you want your tools to do for you. Import your data automatically? Create a budget from scratch? Give you fancy pie charts and percentage % breakdowns? Text message alerts? The list of possible features goes on and on, but you want to have a concrete idea of what kind of features you want before jumping into your search.

Do use them

The most important step in utilizing online budgeting tools is to actually use them. Signing up for a great service and then never using it is not a recipe for success. Checking your spending needs to become a part of your weekly routine. The primary purpose of these tools is to simplify the task of checking your spending. Checking helps you stay on track and avoid surprises at the end of the month. CEO’s get daily updates of the financial status of the company's money. As the CEO of your money, you do have a responsibility to stay up to date on what your money is doing.

Do test multiple tools

Even though you aren’t looking for any tools that cost you money at the start, you should still shop around. Spend some time exploring the options out there. Especially focus on the features of the tools. You may find some features you hadn’t thought of before and wind up choosing a completely different set of tools. You want to be on the lookout for tools that save you time: specifically—reducing the time you spend collecting your financial information. No one likes data entry.

Do check with your bank

The best place to start is with your bank. With competition heating up in the bank sector, many banks have been adding free tools to their online banking platforms. If you hold an account at a major bank, chances are they provide some level of budgeting tools for free. While these tools may not be the prettiest, they are the best place to start because the bank already has all your transaction data. You don’t have to worry about exporting, importing, or formatting your financial data to another platform. The less manual data entry you have to do, the better.


Do not provide too much personal information

It’s vitally important that you remain cognizant of the amount of personal information you provide to these online tools. Since the company is going to be handling your financial data, you are going to have to trust the company to a certain extent. If you decide to use some tools provided by a source that isn’t well known, do some basic investigative work to ensure your information will be safe.

A great way to know if your information is safe is to look for third party verifications such as “verisign”, “trust seal”, or the BBB accreditation. The more advanced platforms will require your banking passwords, which is normal. Never provide your Social Security number to any online tool you use. 

Do not make it complicated

Less is more. When you first start out, you don’t want all the bells and whistles. It's hard to focus on your budget and garner a new routine when you're stuck spending hours learning how to use the tools. The tools should allow you to focus on becoming accustomed to the process and principles of budgeting, so that you don’t get hung up on the logistical details. Start with a tool that meets your minimum needs—tracking your spending. Once you grow comfortable tracking your expenses and have a routine down, you’re ready for more advanced tools.

Do not use just one tool

After comparing multiple free tools, you’ll probably find yourself using one more than the others at the start. Each tool you come across will excel in different areas. As time goes on supplementing your main tool with features of other tools can dramatically boost your budget effectiveness. This turns your budgeting tools into a budget tool box.

Do not settle for just a phone app

Your budget tools need to go beyond a simple smartphone application in order to be successful. A phone application can be a nice accessory to your budget tools, but shouldn’t be the only one. A real long term solution to building your budgeting prowess is beyond the scope of a simple phone app.

Do not set it and forget it

Budgeting is a team sport. If you have a significant other, they need to be part of this entire process. You should both be involved in the budgeting building process and the implementation of the budget. Using online tools is a great way to collaborate because you can both log on and view your finances real time, which can save you both a lot of confusion and accidental overdraft fees.

Jumping cartoon

You can’t improve what isn’t measured. Utilizing the multitude of free online budget tools will help you measure and improve your budgeting. Every person has different needs and will start off with a different tool. As you explore your options and use the tools, you will naturally create an online budgeting tool box—full of a variety of powerful tools that will make you the master CEO of your money. You’ll be amazed when you discover the freedom that comes from controlling your money.

More expert advice about Budgeting

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Jason WhalingFinancial Educator

Jason Whaling is the founder and CEO of The Wealth Titans. A financial education company dedicated to the training and development of individuals to reach their financial goals. Jason left his professional career as an accountant working at a la...

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