Budgeting is important if you want to save for retirement of pay off debt. Mint is the most popular budgeting app as it connects to all of your accounts to calculate your net worth and monthly spending in various categories. While this is convenient, Mint often has connectivity issues with your accounts. It often mis-categorizes your expenses and income. On top of that, Mint is filled with ads trying to get you to sign up for credit cards or loans. In search of a better app, I came across Goodbudget. Goodbudget uses the concept of envelope budgeting and is available on Android, iOS, or the web. Each envelope is a category, and you can fill each envelope with money (monthly or annual budget). You will need to manually enter each transaction and put it in its envelope. The app will track each envelope and let you know if you are over or under budget. If you are under budget, the leftover money carries over into the next month.
Since recurring transactions are recurring, I decided not to create envelopes for memberships, subscriptions, plans, or fixed payments such as mortgage and HOA. Instead, I made envelopes for variable expenses:
- Food and Home Supplies = $1200/month (I often buy food, toiletries, medicine, paper towels, etc from the same supermarket so I combined them together in one category)
- Anything Car related = $500/month (Gas, Toll, Maintenance, Repairs, Parking, Car Wash)
- Miscellaneous = $500/month (Everything else – clothes, toys, electronics, amazon.com)
With a budgeted income of $2200 per month, I try not to spend more than that between these three envelopes.
After using the free version of the Goodbudget app for 2 months, I think it is a better budgeting app than Mint. While it is more manual than Mint, this is an advantage because it helps you save money. Similar to the psychological reason why we spend less money with cash vs credit cards, you will be entering your transaction as you check out anywhere, giving you the chance to cancel your transactions or return some items to lower the charge. With automated finance apps, you see your expenses after you already purchased them.
To make things easier, Goodbudget remembers past places you visited and pre-fills some of the information for you. Adding a transaction takes less than 15 seconds. Goodbudget allows you to export your data into a spreadsheet or add members of your household to budget using the same account. With Goodbudget Pro, you get unlimited envelopes, 7 years of history, the ability to sync with 5 devices, and one on one support for $7 per month, of $60 per year. Since I started using the app, I received zero notifications from Goodbudget encouraging me to upgrade. This is rare from any company and I appreciate that Goodbudget does not spam you with notifications. Mint is still better for tracking your net worth, but I believe Goodbudget is the better budgeting app. Search “Goodbudget” in your app store or visit http://goodbudget.com to sign up.
