I'm often asked which personal finance software is the best. I strongly recommend YNAB 4, the system I personally use. It is by far the best budgeting system on the market. The software is fantastic and the methodology is extremely effective. You can read the review or Try YNAB 4 with a FREE 34-Day Trial!
Buxfer is another web 2.o finance application to join the likes of Mint, Wesabe, Quicken Online, and more. Truth be told, however, Buxfer has actually been around for quite a while. It seems to just now be getting more attention and probably for good reason.
While not a ‘shiny’ as Mint, with some good functionality and even some new features, Buxfer has some real potential. Does it have what it takes to give Mint the boot? Read on to find out.
*Note: Since this review was written the founders of Buxfer has stopped supporting it and have both started working at Facebook. It looks like the service is still available to use, but some are saying that the site isn’t as stable as it once was. I imagine it will only be a matter of time till it’s shut down completely.
A Brief Buxfer History
One thing that I like about Buxfer is that it was created by (and appears to still be run by) a pretty small team. One of the co-founders, Ashwin Bharambe created Buxfer (apparently a mix between the words ‘bucks’ and ‘transfer’) to better track the large amount of “IOU’s” floating around while he was in college at Carnegie Mellon.
Shortly thereafter he teamed up with Shashank Pandit and they launched the Buxfer website in December, 2006. Since then they’ve received some funding from Y Combinator as well as a few angel investors.
Getting Started with Buxfer
After clicking the “Sign Up for Free” button on the main Buxfer site, you simply enter your email address and desired password. You will need to verify your email within 24 hours, but they allow you to continue without verifying right then (thankfully since a day later I still have received the verification email from them).
You’re then presented a screen to choose a membership plan. There three options:
Plus: $1.79 / month
Pro: $2.79 / month
As you can see in the chart (click to enlarge), you get quite a bit of functionality with the free version. The upgraded versions basically allow you more accounts, budgets, financial projections, etc. You also get ‘Priority customer support.” Only time will tell if this ‘Priority’ support will be needed.
*Update: See ‘The Need to Upgrade’ near the end of this review.
I chose the basic membership.
Setup Your Accounts
After logging in you’re asked if you want to have your transactions automatically sychronized or manually enter them. You’ll see in the screenshot that to the side of ‘Manual Entry’ they show that you have the option of the IOU tracking. I’m not sure yet if that means that you must choose to manually enter your transactions in order to have that functionality or not. I surely hope not.
I personally believe that manually entering in your transactions helps with money management, but being that I thought most people would choose to have their transactions synchronized automatically, I too chose that option.
You simply find your bank, enter your online login info, and you’re off. After picking which account you want used, it downloads the transactions.
Buxfer then takes you back to the account setup screen and has you enter in some budget limits on your spending. As you can see in the screenshot, Buxfer aparently categorized some of my transactions wrong because I certainly spent more than $43.24 on food last month. This is, however, to be expected until you go in and re-categorize the transactions. The way some of those transactions appear, you can’t expect these software programs to be perfect.
I put in a scheduled bill for rent for next month. I’m not sure if it makes this a recurring bill or not. Apparently by entering a bill, I will get an email reminder about it.
When I hit submit, I got this error message. Fyi, you can only put dates in the following format: 25 Jun 2009. Not very user friendly in my opinion. Also when I hit close, it exited out of the account setup rather than putting me back where I could fix the date.
A small bug for sure, but something that hopefully will be fixed in the future. (For those that made the same mistake, you can get back into the account setup by clicking ‘More’ then “Account Setup’ on the main Buxfer screen.
Buxfer offers a number of different mobile solutions to help you keep up on your finances on the go. You can use your iPhone, Blackberry or other mobile device that has internet or have it communicate via text messages or via mobile email. In order to work it via texts, you have to set it up with Twitter. Being that I don’t have a phone with internet capabilities, nor a Twitter account (I know, I need to get with the times), I skipped this setup section.
I will say, however, that I like that Buxfers offers this many ways to communicate with Buxfer through mobile means.
Apps & Widgets
Buxfer also offers apps and widgets for Facebook, iGoogle, and Netvibes. Nice. Can I also put in a quick plug for a future Mac widget?
The Buxfer interface has a very clean, functional look. Dare I say it reminds me of Gmail a bit (a good thing)?
At the top-left you have your accounts, tags, contacts, and groups. Here you can add or change settings to these items.
The upper-middle portion of the interface offers different tabs for Summary, Add Transactions, Budgets, Reports, and More. I’ll go through each one individually to give you an idea of what kind of functionality Buxfer has to offer.
I started with the Accounts screens (what you may consider the Transactions screen) because I needed to first re-categorize (or tag) the transactions that had been downloaded in order to better take advantage of the rest of the features.
The transactions section is pretty straight forward with standard Description, Amount, Balance, Tags, Account, and Date data points. You can also sort the list by amount or date. I also like that you can set the number of transactions that show up on the page to 10, 25, or 50.
I noticed that by default it downloaded around 230 transactions (going back about 3 months) from my bank by default. First of all I wish I could have told it how many transactions or how far back in time to download. This wouldn’t be that big of deal, however, if I could easily delete the end transactions that I don’t want to have to go through and categorize. Unfortunately, the only way for me to get to the end of the list (that I can see) is to click the button repeatedly until I get to the end. A “Go to Page X” option would be nice.
Once I whittled down my transactions list to a manageable 120 transactions, now was the task of re-tagging the transactions to make them actually mean something.
Adding (Custom) Tags
I went to the Tag area (top left, click on the tag icon) to add some custom tags (what you could also call a category) in order to make my budget mine. Click on the symbol to open the Add Tags window. Click the again to add a tag. You can add a sub tag or a parent tag from here. Relatively straight forward.
I went to town re-tagging the transactions. To be frank I found the process a little more time consuming that I’d like. It’s not that it’s super slow or that it’s difficult to do. In fact, all you have to do is click on the “(no tags)” letters, a box pops up and you enter the tag.
As you type, it autofills with the tags you have set up for suggestions. Very simple. But it’s just not quite as responsive as I’d like (there’s a half a second delay between clicks). This may not be a big deal for many of you, I just noticed it more since I was trying to re-tag a boatload of transactions.
I’ll say this much, it was enough for me to delete all of May’s transactions (rather than tag them) and only do June’s just because it took too long.
I do like, however, that you can set a tagging rule so that future similar transactions always are tagged as they’re downloaded.
I also like that you can rename transactions and set rules so that similar transactions in the future will be renamed according to the rules. See the screenshots for this process.
*Some transactions show up with the date as part of it. I’m not sure how hard and fast the renaming feature will require the description to be.
You can also edit the transaction in a number of different way by click on the description. Other options include Mark as Transfer, Mark as Refund, Copy, Repeat, Split/Itemize, Attach a Note or File, and Delete. You can also save/export in a number of file formats by clicking the button at the top right.
I feel that I wouldn’t be doing it justice if I didn’t cover, at least for a second, the method that Buxfer uses to synchronize your transactions.
As you can see, near the Synchronize button, it states, “Authentication information is stored offline on your computer.” From what I’ve read, Buxfer uses the Google Gear’s technology to store your account authentication information on your own computer. This way, it is more secure and you don’t have to “trust” Buxfer to hold and secure your account information.
There are some who don’t have any problem with services like Mint that hold your account info on their servers. There are some that do. For those that get a little nervous of the idea, Buxfer may be a better match for you.
Buxfer also offers two other options. You can choose to have them sync transactions at night, in which case they will store your account info on their servers. Or you can use a Firefox plug (Firebux) to do the syncing.
Buxfer’s Summary Tab
Buxfer’s main hub and the area where you’ll land when you first open the site is the Summary tab. The Summary basically consists of an area showing a budget graph, another area showing your upcoming bills, and one showing an expense pie chart. Below this top section is a listing of your latest transactions.
You can click the title of each section to be taken to its respective tab.
In the Budget area you can click on each Tag to be taken to that tag’s budget area that shows a spending graph and a list of those transactions.
In the Upcoming Bills area you can click on the title to see a calendar detailing all upcoming bills and to add Reminders. Or you can click on the bill to edit it’s settings.
In the Monthly Expenses area you can click on the graph to be taken to the Reports area (more on that later).
Buxfer’s Add Transactions
If you choose to manually add transactions, Buxfer allows you to do so in the Add Transaction tab. This opens a single transaction screen where you can add the details of one transaction at a time.
By click the button you get a screen allowing you add multiple transactions at once. You can tab through the fields adding virtually all the info without touching your mouse. This proves to be much faster if you have more than one transaction to add.
In addition, you have the ability to import transactions via a bank export files. It appears that the following formats are accepted: .qif, .qfx, .ofx, and .csv.
The section that I view as one of the most important sections of any personal finance software is the budgeting area. I place such importance on the budget because that’s usually the area that has the greatest effect on the spending and saving habits of the users.
So how does Buxfer’s budget stand up to the competition? Well it depends on who you want to call the competition. If you compare it to some of the highly effective envelope budgeting systems on the market, Buxfer doesn’t look so hot. But if you compare it to other similar services (with similar budgeting functionality) like Mint, Quicken Online, iBank, and others, Buxfer is just as good, if not a little better.
Here’s a screenshot of the main budgeting page:
To the left you have the often-seen bar graph that ‘fills up’ as you spend throughout the month. There is a line that indicated the date so you can see how well you’re doing at that given point in time. To the right of the graph you have the current balance of the budget in each category (how much you have left to spend), your set limit, a rollover amount, and how much you’ve spent.
To the far right you can delete a budget for a category or pause it. When I tried to pause one, however, it looks like it simply deleted it. Maybe they’re still working on that one.
The Rollover Budget Option
The reason that I like Buxfer’s budget better than some others is because Buxfer has the Rollover feature.
It looks as though they’re trying to take a page from the envelope budgeting methodology and include a feature that “rolls over” your budget balances from the previous month.
For example, if I have a monthly budget for Entertainment of $30 and I only spend $15 in May on Entertainment, then the following month I will have $45 to spend. Likewise, if I have a $30 budget for Personal Care, but I spent $50 in May, then in June I only have $10 that I can spend (because a negative $20 was rolled over from last month). See the screenshots for how this would look in Buxfer.
This feature has an envelope taste to it, and I like it. It makes you more responsible for your spending, helps you to plan better, and allows you to build up amounts in anticipation of a large, future expense. (Although it doesn’t do it near as well as YNAB does, I like that they are trying to implement the same ideas).
Unfortunately, however, Buxfer doesn’t facilitate nor encourage creating a zero-based budget (where you budget for every single dollar you earn). This is a much more effective way to plan your spending and savings.
By clicking on each of the individual Tags in your budget you can dig deeper. It opens up a Tags tab which shows you all of the transactions as well as a graph showing your expenses for that particular Tag.
The Reports section of Buxfer consists of three different reports: An Income pie chart, an Expense pie char, and a Balance line graph. By clicking on each section, you are shown only that graph and the transactions that pertain to the graph below.
As expected, you can click on sections (Tags) of the two pie charts (income and expenses) to drill down and see what expenses and transactions make up that section of the pie. Pretty standard.
The Balance graph shows what your balance (the amount of money you have) has been on any given day. Some may find it interesting to watch their balance go up and down with paychecks and expenses, but I didn’t see much use of it.
Track IOU’s with Friends
Buxfer has a pretty neat feature that some (especially that college aged) may find quite handy. You can track what is owed to you, and what you owe others, through the Buxfer system. It appears as though you need to invite friends in order to get them in the system to begin tracking the IOUs.
You can also receive a $1 credit towards membership upgrades for every friend that you refer.
Being that I don’t currently have any friends in the system, I’m unable to test this feature right now. If anyone wants to become my friend, please let me know.
The Need to Upgrade
I was on my 5th or 6th Tag on my budget when I got the prompt to upgrade. I initially thought that I would be able to get away with quite a bit without having to upgrade, but this made me second guess.
I can certainly see Buxfer’s need to monetize their system. And there will definitely be those who think that it’s worth the $1.79 or $2.79 per month.
I would have originally suggested that you just use the free version, but I believe that in order to have any kind of effective budget, you will need to budget WAY more than only 5 categories (ideally all of your spending would budgeted). As such, I say if you’re going to seriously use Buxfer, you need to upgrade.
Is it worth the money? Read the conclusion:
Buxfer Overall Conclusion
As a free tool, Buxfer is great. It has nice functionality that goes a bit beyond other free solutions. I like it’s budgeting function better than similarly designed systems, but it still pales in comparison to true envelope budgeting systems available.
I also like that Buxfer allows you to store your bank account information offline (on your computer) which seems a bit more secure than options like Mint.
If you’re going to use Buxfer as your main budgeting engine, than I highly suggest that you pay for the upgrades in order to actually make a budget that will have any kind of effect on your spending. Looking from the standpoint that you’re paying for it (although it’s certianly not a lot), I don’t know that it’s worth it. You can find much better solutions (that use true envelope and zero-based budgeting) on the market for a little more than a one year’s subscription to Buxfer’s upgraded options. There are however, many that will likely find Buxfer a refreshing alternative to other free personal finance software solutions.