Financial Resolutions for 2006: Budgeting

Every year I do an annual budget at the beginning of the year. I then track our actual spending against the budget using Quicken. In July, I complete a new budget, updating our estimates for July through December spending based on what happened the previous six months and what we know about the next six months.

2006 will be no different than past years. I plan to complete an annual budget by January 7, 2006 and to update it again in July 2006.

For budgeting, FMF recommends: You Need A Budget

Comments

[CPA1298]

FMF -

I think it's great that you're doing some in-depth budgeting and expense tracking, but I have to ask - why do you use Quicken instead of Quickbooks or Peachtree? I used to use Microsoft Money, but the extra functionality you get from a true double entry accounting software makes the analysis so much better and easier. I've been 'live' with Quickbooks since 1/1/2005, and I really enjoy being able to generate a trial balance, balance sheet, and income statement with the click of a button. I've noticed that pretty much everybody that posts on Pfblog uses Quicken, including MM. Granted, Quickbooks is a little pricey, but the edition I have is a 5-user version, allowing one to split the cost with several people.

[FMF]

1. I've used Quicken for several years and all my data is in it. Don't know if it would transfer well to QB.

2. It's cheaper. I don't have five people to split a license with.

3. I know how it works. No need to learn a new system.

4. It gives me all I want. I can get spending reports (similar to income statements) and net worth charts (like balance sheets). What more do I need?

5. It tracks investments. Does QB do this for stocks, etc.?

Just a few reasons.

[CPA1298]

I don't blame you for using Quicken; I wouldn't switch if I were you. However, I would definatly recommend Quickbooks for anybody just beginning to get serious about tracking their finances, who happens to have even the most remote concept of double entry accounting.

Do you plan to post your budget on the blog? Would that be too much disclosure?

[FMF]

No, I don't plan on posting my budget online. It is too much disclosure plus I don't think people will learn much from it (other than the fact that the principles I discuss here are worthwhile).