Personal Financial Management Using Quicken

One of the things I keep hearing from friends and colleagues is that they never know where their money goes. I used to have the same problem before I started using Quicken.

The software makes it extremely easy to figure out what you are spending your money on and how you can cut your expenses.

Take a look for example at this little graph I generated on Quicken in about 20 seconds. It shows my family's spending on our electric bill in the past year. The same can be done for every expense category, or for your entire budget.



Now it's only a matter of self discipline to reduce expenses, not a matter of knowing where money is being spent.

The graph below is a pie chart showing the relative size of my family's expense categories. I blurred the overall amount to protect the guilty... As you can see, budget management is now easy as pie. The other thing you may see is that having three kids is really expensive...



Each of the categories can be drilled down deeper and you can see spending down to the individual expense level. Good stuff.

Prior to my Quicken days, one of the financial tasks I found most difficult was getting a good grip on my portfolio.

Like others, between 401(k)'s, IRAs, Brokerage Accounts & 529 plans I could never get a complete picture of my family's investment portfolio.

Luckily Quicken gives me an excellent tool for monitoring my entire portfolio, regardless of which accounts assets are located in. Take a look at the portfolio graph below. Once again, I erased the actual numbers for obvious reasons.



From this overview chart, you can dig deeper into individual accounts, individual stocks or funds, and run any other report or chart you can think of.

For example, the chart below (which again took me 20 seconds to run), shows the growth of $10,000 invested in my portfolio on Jan 1, 2004 vs. the growth of an equivilent investment in a number of indexes.



Unfortunately, neither my wife's 401(k) nor mine supports Quicken direct download, but every other financial institution we work with does.

To me retirement savings is a big deal. I want to make sure that in our golden years, my wife and I have enough money to enjoy ourselves and to not become a burden on anyone.

Quicken is a big part of my retirement planning efforts. The software helped me figure out how much money I am likely to need, helped me understand the projected value of our retirement assets using our actual savings rate, and made suggestions as to how to improve plan.

Bottom line, currently Quicken tells me that my wife and I are on-track to a well-to-do retirement. That's what I call peace of mind. Take a look at our retirement plan graph below (again, I removed the numbers to protect our privacy).



Another nice thing is that Quicken allows you to explore "what-if" scenarios and to change your assumptions to see how resilient your retirement plan is.