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Budgeting Your Finances

Free Online Budgeting Website ComparisonHigh school home economics classes once taught us how to balance our checkbooks. But as technology expands its reach into every facet of our lives, that skill is quickly falling by the wayside. These days, for the most accurate picture of where your money is and where it's headed, all you really need to know how to do is turn on a computer and visit a single website that does the work for you. But is the new computerized method actually better? Using a pencil and paper is free, but it's time-consuming to transcribe and compute all those numbers, and pulling together information from everywhere in your life can be laborious, and it can also be stressful to have to face your money situation over several hours at the kitchen table.

Some users are more comfortable keeping their financial secrets offline, but the truth is that sentiment is also a thing of the past. The contents of our pocketbooks are already available online somewhere (your bank has all of your numbers in its computer, whether or not you have access to it online yourself.)

There are software packages that will do the work for you, but since two major resources can be used without spending a penny, we'll look at those.

Mint.com has around 1.5 million users, and it's free. One of the biggest advantages of Mint is that it collects information from everywhere you have accounts. Your bank, your credit card issuers, your investments, your retirement accounts, and even your PayPal account are all linked together so you know where your money is and what you owe.

When you debit any account, Mint updates your file automatically, so there's no moment of guilty bookkeeping when you have to 'fess up to spending sprees by entering the damage in the debit column of a checkbook. Shameful moments like that are a big reason so many Americans avoid dealing with their finances, but if your information is collected automatically, it's much easier to see the big picture with clear eyes.

Mint can even help you plan for big-spending months, such as the holiday period, and divide your suggested expenses accordingly.

It's not perfect. If your account holder isn't yet part of Mint's system, you can't add the information, which means Mint works best for people who solely deal with major corporate names and not mom-and-pop institutions. Also, Mint's pre-set list of expense categories frustrates some users. Some people find the site's structure simply isn't flexible enough for them.

But it does provide an added service. It can compare other financial institutions and credit card issuers and let you know if you could do better than what you're already doing, and that can make you money in the long run.

Another money management site, Yodlee.com, is rougher around the edges, but it also pulls together your whole portfolio in one place. Although it's not as pretty, it does one better than Mint: It allows you to pay bills online right from its site.

There's a growing pressure for banks, and not third-party sites, to offer similar services to customers, but most banks have so far been unwilling to incorporate figures that may come from rival institutions. WalletPop recently covered the movement when it was announced that double the number of Americans were ignoring their personal finances last year than the year before.

To learn more about these budgeting websites, to have a look at them in action, and for more tips, check out our Savings Experiment video, above.

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