Budgeting Apps: We Tested Four, So You Don’t Have To

Do you struggle to hit your spending and savings targets or are you stressed when making spending decisions? If so, have you considered one of the many budgeting apps? 

Budgeting apps are designed to help you make better-informed decisions about potential spending changes by: 

• Tracking spending: shows you what you’ve spent money on in the past  

• Generating reports: provides a long-term view of income and spending 

• Consolidating accounts: gathers all your accounts in one spot, simplifying spending management  

• Budgeting: sets spending targets for the future 

But what software should you use? I recently tried four popular budgeting apps. Below I will summarize my experience with each. 

Quicken 

Strength: Reporting 

• If you want the best software to track and generate reports on past spending, Quicken may be the answer. Quicken has the best reporting capabilities. It offers many standard reports and  generates and saves custom reports for specific types of spending over any time period.  

• You can use Quicken’s reports to compare spending targets from a financial plan to actual spending. For instance, you can generate a report that only includes expenses included in Sensible’s “consumption spending” category over the past 12 months. You can then save the report and at any point in the future easily confirm (in a matter of seconds) that your consumption spending aligns with your plan. 

• Once the initial setup is complete, Quicken is quite easy to use. While it is not quite as intuitive as other software, the learning curve is not significant and should not be an obstacle to using the software. 

Weaknesses: mobile/web application and budgeting 

• The main downside to Quicken is that you have to download the desktop application to get all the features. Their mobile/web apps are quite poor. I also had issues syncing changes made on the mobile app with my desktop version.  

• Lastly, Quicken’s budget feature is quite limited. You can create targets and compare them to actual spending, but the creation of the budget is time consuming and does not allow budgeting on a rolling basis. In other words, if you spend less on one category than you had budgeted, it does not apply the surplus to the next month’s budget. 

Simplifi 

Strength: reporting and budgeting by category with “watchlist” feature  

• If you like everything about Quicken, but want a web version and mobile app, Simplifi may work well for you. Like Quicken’s, Simplifi’s reporting capabilities are extensive and highly customizable.  

• Simplifi offers additional features that may be helpful including a “watchlist” that allows you to select targets for certain spending categories. The watchlist permits you to easily view spending over the current month, year-to-date, and 12-month average for each of the watchlist categories. Simplifi also offers the option to receive alerts when you get close to or exceed those targets.  

Weaknesses: general budgeting and inability to save custom reports 

• Simplifi does offer a general budgeting feature that they call the “spending plan”. It allows you to enter anticipated income,  planned savings and anticipated spending on specific categories. It then calculates what you have left to spend on everything else. However, the spending plan does not work well unless your income and bills are consistent in amount and timing. Another issue is that the spending plan does not support budgeting on a rolling/annual basis.  

• The only difference between Simplifi’s reporting options and Quicken’s is that you cannot save your custom reports and will have to recreate them each time. 

YNAB (You Need a Budget) 

Strength: best budgeting feature  

• YNAB teaches you how to budget and make spending decisions by allocating your income and savings using buckets. When you receive income, it prompts you to specify how much to set aside for each spending category. When you make a purchase, the software shows you how much you’ve budgeted for each category and how much is left (available). If you spend less than your available balance in the month, the extra will flow over to the next month. If you spend more than your available balance, it prompts you to decide how you’ll cover the shortfall (move money from another category with a positive balance). Thus, it easily shows you the tradeoffs for each spending decision and encourages you not to exceed your overall budget.  

Weaknesses: steep learning curve and limited mobile app reporting 

• The main downside to YNAB is the steep learning curve. While the other apps are fairly intuitive, it took me a month or two to really understand and get comfortable with YNAB. Once I did, I was convinced that if you have the patience to persevere, YNAB is the best option if you want help with managing your spending. However, I suspect the adjustment period may be too much for many. 

• The only mobile app limitation is the reporting. The reports are much easier to use on the web application. Other than that, the YNAB mobile app has everything you need to make daily spending decisions.  

Monarch 

Strength: user friendly, excellent budgeting feature, and multiple data aggregation options  

• Monarch is an excellent alternative to YNAB if you want help making decisions based on a budget, but want software that is easier to learn and use. In fact, I found that of the four software options, Monarch was the most intuitive. The prompts make it very easy to use and the interface is the best of all the options presented here.   

• Another advantage of Monarch is that it uses multiple financial data aggregators. This means that there are multiple ways you can connect your accounts. So, if one does not work, you can try another aggregator. This is a significant advantage because it is not uncommon to have trouble connecting certain accounts. Without a working connection, it is much more difficult to efficiently use the software. 

Weaknesses: reporting and investment categories 

• Unlike Quicken, you cannot save your custom report to run again in the future and will have to recreate them each time. Also note that the mobile app limits reporting periods to monthly, quarterly and yearly. On the website, you can run reports on any date range, filter by category, vendor, etc. 

• The only other downside is the way Monarch (currently) handles investments. Their only categories for investments are buy and sell and there are no “dividend” or “capital gains distribution” options.  

When it comes to budgeting apps, there are many options. Hopefully this article helps identify a software option that might work for you or at least highlights considerations when choosing what app to use. If you have additional questions or would like to know how you can use the software with your personal financial plan, reach out to your advisor for assistance. 

Disclosure: Sensible Financial purchased subscriptions to each of the technologies reviewed as part of our assessment. However, we were not compensated for providing our opinions on their effectiveness. Additionally, we have no affiliations with any of the technology vendors mentioned in this article. 

Photo by Lukas Blazek on Unsplash