As that expensive time of year is fast approaching, I decided to try and better manage my finances. In the past I used to do it with my own designed databases or spreadsheets but it was always time consuming to maintain. This time I got hold of a application called Moneydance that was recommended on the Which? website.
Its probably overkill for the use I need, but it does do a very good job of both visualising my expenses so I can see where I can cut down as well as allow me to quickly review and check the years transactions for anomalies or “expensive things” I should not have paid for.
Another potential issue for most people will be the complexity of actually managing your personal finances in such a detailed way. Using online banking it was easy enough to download a years worth of transactions in .ofx format and import it. Unfortunately, you do have to define what category each transaction is one at a time. Thankfully, Moneydance learns and starts suggesting categories so it only took me 2 hours to check a years worth of transactions.
I also had to provide opening balances to get things to balance. I have an accounting background so expected as much, but I can imagine it would cause confusion for some people when you see your current balances not matching live balances.
To the right, you will see a comparison of my income and expenses for the entire year to date. Giving me an overall picture of how well I am doing in terms of controlling my spending and not living beyond my means.
Its interesting to see the spikes visually like this. A is when I deposited cash I got as gifts from Christmas. B is my expenditure from attending the Denmark meet up. C is from selling various assets. Ignoring those, my expenditure remains consistent, slowly increasing due to inflation I would guess? But as my income is not increasing it does highlight the need to address my expenditure and cut back more.
In the left image, you can see how easy it is to browse transactions by category. Unfortunately I could only download the last five months credit card transactions online. Income and Expenditure graphs still look correct because payments to the credit card are on the current account so I had accurate total values. I just lacked the option to view the details for the start of the years credit card transactions.
This is perhaps one of the most useful reports though, as once I get it working it shows the highest expenditure. There is no point me worrying about how to lower a £15 monthly bill when I have £200 going to Sainsbury’s that I could try and cut down on for example.
Anyway, that’s all I have been up too… Now that I have set this up, its easy to maintain on a monthly basis and I do love playing with new applications and playing with figures. XD