Tools
20 tools are helpful for constructing a personal budget. Regardless of the tool used, a budget's accuracy is only as good as the accuracy of the updated budget data; an old budget that does not reflect actual income or expenses is of little use to a current budget. Computer generated budgets have become commonly used as they replace the need to rewrite and recalculate the budget every time there is a change.
- Pencil and paper
A simple budget can be written on a piece of a paper with a pencil, and optionally, a calculator. Such budgets can be organized in three-ring binders or a file cabinet. Simpler still are the pre-formatted household budgeting or bookkeeping forms that creates a budget by filling in the blanks.
- Spreadsheet software
Spreadsheet software, including Microsoft Excel, iWork Numbers or OpenOffice.org Calc, helps to arrange budgets according to need and performs calculations easily with rudimentary formulas. For example, budget spreadsheets are used to keep track of income and expenses. The major reason most people discontinue using budget spreadsheets that don't offer date-shifting is that the information needs to be reentered or moved at the end of each month. Spreadsheets are still excellent for complex budgets and planning.
- Money-management software
Some software is written specifically for money management. Products such as Fortora Fresh Finance, Moneydance, Quicken, Microsoft Money (discontinued), and GnuCash are designed to keep track of individual account information, such as checking, savings or money-market accounts. These programs can categorize past expenses and display monthly reports that are useful for budgeting future months.
- Money-management websites
Several websites, such as Mint.com, have been devised to help manage personal finances. Some may have a privacy policy governing the use and sharing of supplied financial information.
- Spending-management software
Spending-management software is a variation of money-management software. Unlike typical budgeting that allocates future personal income towards expenses, savings and debt repayment, this type of software utilizes a known amount of money, the cash on hand, to give the user information regarding what's left to spend in the current month. This method eliminates some of the guess work associated with forecasting what a person might receive for income when it comes to allocating budgeted money. Like money-management software, some spending-management software packages can connect to online bank accounts in order to retrieve a current status report.
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