Track Every Penny

Personal finance software universally sucks. I have two theories for why this is:

Firstly, there actually is no personal finance software. It’s all just dumbed down versions of corporate accounting software. No matter how it’s dressed up to be ‘user friendly’, at the heart of it all is the core underlying assumption that you want to run your personal life like an accountant runs a business. Many people have been sucked into this way of thinking, in large part because it’s the mindset that using such software foists upon you, but really it’s a poor model.

The second reason is that it’s almost all created by Americans. By itself, of course, that’s not necessarily a bad thing. But it becomes a bad thing when it reflects their view of the world, which, particularly in matters of personal finance, doesn’t really hold true in other countries. And I’m not just talking here about the assumptions that are generally built into how relatively complex things like mortgages, or sharedealing, or taxes, or retirement accounts, etc work in different countries. Mostly I’m talking about the really simple things like not assuming everything is in US dollars! Sure, there’s generally a token nod to other currencies, but most finance software cope can’t even cope with simple multi-currency transactions (like all the times in Switzerland when I got a bill in Swiss Francs but paid in Euros), never mind the more complicated ones (like the time I bought my bus ticket from Bulgaria to Macedonia using my last remaining levs and made up the difference in Euros). And because most people who write finance software have never lived somewhere like New Zealand where the smallest coin is the ten cent piece, they tend not to cope very well with things like Swedish Rounding, where your total is rounded if you’re paying by cash (but not if by card).

Of course it’s possible to do these things in most software, but only if, under theory #1, you can think like an accountant and do the equivalent of lots of complex ledger entries. But lots of things that are deliberately really complex in business accounting are commonplace in people’s personal lives – like asking your friend if they have eighty cents to avoid needing to break another €10 note.

Most people get round all this by just ignoring it. Who really wants to have to record that their shopping bill was €14.80 but eighty cents of that came from Steve anyway? Well, me. I’m a firm believer in the “track every penny” school of thought. And I hate how hard it is for me to do so. In the 5 months of this year so far, I’ve been in 9 different countries. I keep every receipt, and record every item from every one of them. And it’s much too much hassle. I’ve tried numerous different software packages, and they’re all terrible for me. There’s a lot of innovation in the area recently with sites like Mint and Wesabe springing up and giving the old faithfuls of Quicken and Microsoft Money a serious run for their money. But there’s increasingly an assumption that most of your spending detail can be automatically obtained from your bank records so you don’t need to type it in. It makes sense for them to concentrate there, as having to painstakingly enter all your spending is the thing that puts most people off ever actually keeping track of where their money is going. But the more that part gets automated away, the less these companies work on making it really easy to enter transactions manually — which leaves me worse off, as I do the vast majority of my spending using cash, and my bank records thus tell me next to nothing. Even on the rare occasion where I pay for my groceries on my debit card, I don’t just want a total spend entered—I want a full breakdown of every line item. I want to know at the end of the year just how much I spent on milk or eggs, not just on “groceries”.

So I want software that works for me. That assumes I’ll be travelling a lot and working with multiple currencies. That makes it easy for me to enter detailed records rather than a chore. That deals with all the little details I raised last time I ranted about this.

It may be that I’m the only person in the world that actually wants this software, but I suspect I’m not. In the current economic climate people are watching their pennies carefully. Almost every personal finance book suggest that people literally track every cent they spend for at least a month. I think lots of people would like to know much more about where their money goes, but the pain of keeping track currently outweighs the benefits for a lot of people. So I want to make that easy.

I have a detailed vision of how that software would work, but I can’t build it by myself. Anyone want to help?

7 thoughts on “Track Every Penny

  1. I know it’s probably the most obvious option, and that it doesn’t fit your “not like corporate accounts software” ideal, but have you ever actually sat down and tried GNUcash? It’s very easy to enter a transaction from your card, but then split it across multiple accounts, which may or may not be subaccounts of Groceries and/or Loans/Steve.

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  3. Ugh. GNUcash is pretty much the opposite of what I want. I haven’t looked at it in a while, but unless they’ve completely rewritten it with a different philosophy, it’s just like Quickbooks, only much much worse, and pretty much fails every single one of the items on my wishlist.

  4. We (Wesabe) have had full currency support in the manner you describe (if I’m understanding correctly) for over two years now:

    Your default currency is assumed based on your country (set when you register). You can change your default currency, or the currency of any account, at any time. If you upload data that specifies a currency, we use that instead of whatever your default is. Your reports are all shown in your default currency — each transaction in another currency is converted based on the exchange rate on the day of the transaction. I believe we now support over 130 currencies.

    I can’t promise it’s perfect, but it’s gotten a lot of use and has many happy users. Drop me a line if you have questions or suggestions for how we could make it better. We are, admittedly, mostly Americans, but we listen. :)

    Marc Hedlund
    CEO, Wesabe

  5. Oh, and, yes, you can enter manual or cash account transaction data any time you want, and add transactions by hand to any uploaded/automated account any time you want.


  6. Hi Marc. Yes, Wesabe is currently the best of the options out there for me, and I’ve gone through a few periods of using it heavily. But it’s still not really there for me. Yes it’s possible to do many of the things I want (more details on these are in my earlier rant), but it feels like I’m fighting against the software for many of them, because that’s not what it’s optimised for. So mostly I’m still making do with an increasingly complex and brittle set of Excel spreadsheets. It’s ugly and highly inefficient but at least I can get what I need out of it.

  7. If you EVER come across a software that does what you want it do, let me know. I’m of your school of thought completely, and I haven’t found a software that can let me categorize and tag purchases and split store visits into different categories with the level of detail I’d like. I want to know how much I spent on eggs and milk and even know which brands I bought from.

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