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Monday, November 15, 2010

Free Personal Finance Software for the Rest of Us

I've been maintaining Excel sheets for my personal finance for quite some time. It's simple but leaves me with some manual maintenance here and there. Having learnt about mint.com, I thought that I should give online free finance tools a try.

So, let me first clarify who the "rest of us" are. The segment I am referring to do not live in the US and can't afford Microsoft Money or Quicken, and hence are primarily interested in "freeware" or open source software. A typical user in my mind has more than one bank account (possibly in different currencies); he has some cash in hand (again, possibly a few notes in any other currency lying in his drawer); he has some liabilities in the form of house loan, etc. The purpose of the tool should be to show the current financial position to the user. Requirements can further be elaborated as follows:

  1. The software should be (absolutely) free. So, Microsoft Money, Quicken and Money Dance are out.
  2. It should support multiple currencies, and should ideally fetch the exchange rates automatically from some central internet server.
  3. It should provide support for opening different kinds of asset accounts (bank account, cash in hand, etc.) as well as liability accounts (such as home loan, car loan, etc.).
  4. The bank where any accounts are maintained doesn't provide live access to the account statement to these tools. That is, there should be an option to manually do all kind of entries.

Free Online Finance Tools

Unfortunately, mint.com is only for the US people, and wesabe.com no longer exists. Frustrated, I tried both yodlee.com as well as moneytrackin.com, and found several important features missing.

Yodlee's problem is that it's too much focused on "online integration with your bank and credit card companies." The option to create a manual account is hidden deep down (i.e., the usability is poor as if the feature is of extremely low important). Moreover, when you are about to create a new account the currency options are limited to 7-8 different currencies. It fails the criteria test above, and doesn't fit my purpose.

Yodlee Manual Account Opening Screen

And MoneyTrackin's problem is that it's overly simplistic---e.g., in order to create a liability account (such as home loan), you have to enter the balance in negative. The nice thing about MoneyTrackin' is that it efficiently handles multiple currencies (automatically fetches the exchange rates and shows your dashboard in the base currency). Another bad thing about MoneyTrackin' is that too much space is being utilized by ads.

Personal Finance Dashboard from Money Tracking

Despite its shortcomings, if you want an online free personal finance application, MoneyTrackin' comes close.



Free Desktop Personal Finance Tools

Having no luck with online tools I tried GnuCash, Money Manager Ex and Grisbi. Amongst these, Grisbi crashed several times. So, it's out. Money Manager Ex seemed good but it doesn't have the concept of Liability Accounts (loans, etc.). The usability of Money Manager Ex can be improved quite considerably. So, it works but making posting entries into the accounts is extremely cumbersome.

Finally, GnuCash was tried, and it has quite a few interesting things. It wins hands down amongst in free personal finance tools with a minor caveat: it's more than personal finance; it support complete dual entry accounting system. And hence, there is a learning curve here for a novice user.

GnuCash Personal Finance Summary


Drawbacks of GnuCash

GnuCash does have a few flaws that I would like to have fixed. One of them is the download size. It's 62 MB! Secondly, in order to fetch currency exchange rates (or stock quotes) from the Internet, it is further dependent on a Finance::Quote library of Perl. This in short means that you need to download Active Perl (if you are on Windows, which is a 9MB download in itself) and further install Finance::Quote.

My Verdict

GnuCash! Go for it!