Personal Financial Software

Continued from page 2

By Simson Garfinkel

January 8, 2003

From a performance point of view, Money had even more problems with my large transaction file that Quicken did. (This is all the more surprising when you consider that the 19 megabyte Quicken file only took up 13 megabytes in Money; once again, the culprit is poor programming.) Sometimes I would click on a button and wait 15 or 20 seconds before Money responded-all the while consuming 99% of the CPU of my 500 megahertz Pentium III computer. (And lest you think that my file is the problem, consider this: I imported the same QIF file into Quicken 2003 for Macintosh OS X. Once the data was imported, Quicken for Mac ran fast and flawless.)

If I was starting out from scratch, and if I didn't have nearly a dozen different financial institutions set up with Quicken, I might very well start off with Microsoft Money. I like Money's clean interface. And the program doesn't seem to have the fits of starts and stops that Quicken has. As things are, even though I thought I had the freedom to switch, it turns out that I didn't.

New Competition

But moving forward, the real battle isn't between Quicken and Money: it's between financial software that runs on your home computer and Web-based applications run by banks and brokerage houses.

I asked a friend who used to work at Intuit what he uses for keeping track of his home finances, and I was shocked by the answer: he's given up on Quicken. Instead, he does his banking over the Web using Fleet. Another person I know is doing much the same, but with Commerce Bank in Philadelphia. Both systems let you get up-to-the-minute bank balances, view historical information, and even reconcile your checkbook online. One of the things that really impressed me about the Commerce Bank system is that the company lets you download images of canceled checks over the Internet.

I get the same sort of service with my online account at Cambridge Trust: what's more, the records go back for five years. The only thing missing is the Payee from each check. It's a shame that there is no easy way to upload this data from Quicken. On the other hand, I could just do away with Quicken and do everything online. 

Indeed, pure Web-based online banking overcomes many of the problems that I've experienced. The banks presumably do a better job backing up their data than you ever could. And you can access your banking information from anywhere-for example, a library, your office, or even a cell phone.

The real problem with the online services is that they don't allow you to easily knit together transactions between multiple financial institutions: with Quicken I can easily indicate that money from one bank is transferred to another. That's hard or impossible with the Web-based systems. But comparatively few users need that kind of sophistication. Even the simple Web-based systems will let you categorize transactions and create reports that are subtotaled by category, which is really all you need for figuring out taxes. And these systems have a huge advantage over running your own accounting software: the numbers are the real numbers from your bank.

People like me who are self-employed or have small businesses and need to accurately track their expenses will continue to use programs like Quicken, QuickBooks, and Money. But it's increasingly likely that people who are yet to make the jump to such software never will: they will simply do Web banking and keep paper records for when they switch institutions.

Web banking applications are still crude, but I believe that they are the future.