Microsoft Money Plus Premium Review

**Note:  Microsoft has announced that as of June 30th, 2009 MS Money will no longer be sold. Essentially this means there will be no more support or updates to the software.  I’ve left the review of MS Money here for those interested.

This is a review of Microsoft Money Plus Premium (woah! quite a mouthful). If you’re considering Money Essentials, or Money Plus, this review still applies because Money Plus Premium includes all features of the lesser products (and then some, though I’m not speaking here to their overall usefulness).

My first experience with Microsoft Money was a negative one, but I plowed through. Outlined below is the entire experience, from beginning to end.

Getting Started with Microsoft Money

You can see from the account walkthrough screenshots that it felt easy, but didn’t actually do the job right. The main problem being that I’m not sure how Wells Fargo is handled with Microsoft Money. There’s both Web Connect and Direct Connect and, frankly, I have no idea how either works. Though I think you pay for Direct Connect (a few dollars every month) and don’t pay for Web Connect. Both appear to offer the exact same functionality.

I told Microsoft Money that I had bank accounts at Wells Fargo and it then basically set up an account for me called Wells Fargo Bank Banking. As if anyone would name their account that. I promptly deleted it and started again.

On the restart, I said that I did have information that would let me log in to Wells Fargo (Quicken lets me using Web Connect). Unfortunately, Microsoft Money only uses Direct Connect, so there will be a few dollar charge each month. No thanks, I’ll pass.

This time through I was presented with this screen:

So I decided to try and sign up for MSN Money My Accounts (whatever the heck that is). After a lengthy process:

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I got it.

Then how do I get it to sync with my Wells Fargo accounts? I went back through the Account Setup process (after changing Microsoft Money to recognize the fact that it now had a Windows Live ID stored) and was presented with a new screen:

I then began the process of sync’ing to Wells Fargo:

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It took (and I’m not joking) 7 minutes to get the information. At least it worked. I tried to find a quick way to remove the business accounts (I only want it running the personal finance stuff) and tried to delete the account. I was rebuffed with a fairly stern warning that all of my Wells Fargo accounts would be deleted if I deleted just one. So I opted to “close” it instead. (If you ever run into the issue where you need to do this multiple times, go to the Account List -> Change account details ->Close or reopen accounts option. It’s much quicker than changing the settings of each account).

I added my credit card as well and, now used to the process, did it easily. It still took forever to get the account information.

I finally had my “basic” financial information in there – after only about 55 minutes. (And I’ve done this a lot so I generally consider myself pretty savvy). Ouch.

Since I was already adding a bunch of other financial information, I went ahead and added my brokerage account as well. I clicked on “Investments” and was brought to what looks like the MSN Money portal (but embedded inside their app) complete with advertisements:

And I just paid $60 for this app. Microsoft Money is showing me advertisements after I just paid them sixty dollars! It’s enough to drive you crazy.

At any rate, back to the brokerage account…I ended up going to Banking -> Account Tools -> Account Setup. The account was successfully added, but no balance was showing. In the “To Review” column it showed so I clicked on that and followed the wizard, reviewing each of my investment transactions. I’m not sure why the review was necessary, but I did it.

Well, I thought I had. I was then presented with another screen to basically review them again and click “Done”. I was finally “Done” and the transactions were all listed in my brokerage account.

So far, Microsoft Money had been everything but easy to use. I was feeling lost.

Looking Over My Spending (Categorizing) in Microsoft Money

I opted for the Advanced Register View, which means I can see virtually everything about the transaction, and it doesn’t present just the basics. I quickly didn’t like several things

  • I had to double-click on a transaction to be able to categorize it. What a time-waster. (You can also hit Enter and use the down-arrow keys. I found out about the Enter key a bit late.)
  • I couldn’t see which category a transaction belonged to unless I clicked on it. (I switched back to the Essential Register View so I could see the category).
  • The auto-categorization was very weak. For instance, the payee on my WF Credit Card AUTO PAY (my checking automatically pays my credit card each month) was categorized as Automobile, no doubt because of the word AUTO in the payee.
  • It doesn’t learn from the changes I’ve already made to Payees. I can change POS PURCHASE – COSTCO WHSE #00CO to Costco 1,000 times and it still won’t infer that I’d like that changed with the transactions already in there (it will on the next import, just not with those currently imported).
  • You can’t select multiple transactions to categorize them all at once (I want all checks written to be Miscellaneous – a justified want!).
  • The beep that fires every time you change a transaction gets old in about 10 seconds.

To try and speed the categorization process, I decided to see how Microsoft Money used Payee/Category rules. I knew (see the last bullet above) that I had to set them up manually…so I gave it a shot. I couldn’t find how to do it until I searched in the Help file. There I found that if you go to Banking -> Account Tools -> Categories & Payees -> Payees that you’ll get there.

It turns out that it will start to auto-categorize based on your payee names, so that did help the process a bit toward the end.

Preferred Payee Names

To be quite frank, I was completely overwhelmed by how the system worked. Microsoft Money has Payees, Categoires, Preferred Payee Names (which I don’t fully understand after working with it for a half hour) and then classifications (not to mention tax categories and a Payee Rules Manager, which seems awfully similar to the Preferred Payee Names section — at least in function.

I finally realized I could “move” transactions from one Payee to another, so I started doing that — hoping it would save me some tedious manual time with the new transactions. It didn’t. It was just as tedious.

Microsoft Money overdoes it with the Payees. They want to you to store the payee phone number, addresss, account number, etc. It’s just absolute overkill. All we want to do is to manage our money a little better!

The Microsoft Money Dashboard (Home Screen)

The Microsoft Money dashboard is chalk full of information — most of which you probably don’t want to see.

You’ll notice on the right there’s a large pie chart showing your spending by category. Unfortunately, there’s no way to customize that view to exclude certain items (such as the Credit Card Payments/Transfers, which obviously will occupy a lot of the chart, since the total amounts will be double-counted). At the bottom right you have the Spending Tracker, which measures your spending against a budgeted amount. It does this from month-to-month and doesn’t roll over your excess amounts to the next month.

This creates an obvious issue. You can “budget” $50 each month in preparation for a $300 bill in six months, but when you pay that bill in the sixth month, you’ll have “overspent” by $250 ($50 – $300). Of course you haven’t, but Microsoft Money doesn’t have any way to get around this.

What truly annoys me with Microsoft Money and its dashboard is the connectedness to “Headlines from MSN Money”. If I wanted to visit their website, I’d visit it. You can to get rid of it, but of course they have it in there by default.

On the left-hand side of the dashboard you have your navigation:

  • Account List
  • Bills Summary
  • Budget Summary
  • Reports Home
  • Investing Home
  • Planning Home
  • Taxes Home

…with various suboptions underneath each of these. Microsoft Money has truly tried to be a one-stop shop for your finances.

Microsoft Money Banking

With the banking, you can manage your accounts (add new, close, delete, merge, add a frequent flyer plan, pay bills, etc.). What irks me is the “Related links” section:

You notice you can “Check out loan rates” or “Get free insurance quotes” where of course Microsoft makes money with any leads generated. That kind of embedded advertising is what makes me shelf Microsoft Money straightaway. You’re always just taken to their portal.

Under Banking you can also go to “Mortgages and Loans” but unfortunately, that just takes you to MSN Money again. What about Bank Services? Same story. Have big ads thrown in your face.

The Credit Center isn’t quite as bad. You still have an ad very prominently displayed for Experian free credit monitoring, and articles and resources about credit as listed on MSN Money. However, you do have some relatively convenient little calculators that let you figure out how much something really costs when you finance it, and how quickly you can pay off your debt. From the Credit Center you can go to the Debt Planner, Analyze Credit Cards, or See Debt-Related reports.

Unfortunately, as soon as you go to the Credit Card Analyzer you’re presented with a laundry list of options for different cards you could apply for. It’s basically one big advertisement — along with Discover’s ad…:

How lame is this? You’re led to believe it will analyze your credit cards but instead it’s just an ad.

I decided to bite and try the Debt Reduction Planner

Microsoft Money’s Debt Reduction Planner

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You’ll notice on the “Take Action” section that the What’s Next? area links to the Credit Card Analyzer (ad), Debt Manager (MSN Money, where they have ads) and getting your free report (an ad). It feels like they’re talking out of both sides of their mouth, where they are telling you to apply extra toward your debt, while at the same time shoving ads into your face.

The final “Finished” page sends you back to buy an Experian credit report. And lest we forget, I paid $60 for this software.

Microsoft Money’s Bills

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This is standard transaction scheduling, though there are some nice things to be noted. One particular feature I found useful was that you could say the bill is a variable amount, and have Microsoft Money estimate based on the prior X number of payments.

I found the Bill Calendar to be a bit much — as far as usefulness is concerned.

Microsoft Money Reports

You have a fairly rudimentary two views on your Report Dashboard, but you can drill down into the following reports:

  • Spending by category
  • Spending by payee
  • Spending by category comparison
  • Monthly budget
  • Net Worth
  • Credit card debt
  • Portfolio value by investment type
  • Monthly reports

Note, this is only for the Essentials setting for reports. Of course they have an Advanced setting, where you have a whole slew of reports:

These reports, while at first very impressive, are only as good as you make them with the data you enter. That’s the trick with these things. If you want to be able to accurately track loan interest, then you need to make sure you have it set up correctly. If you want to track your frequent flyer miles? You need to make sure you enter them!

Budgeting in Microsoft Money

The default Budget is called the Essential Budget and it’s basically what we see below. It reminds me of basically every other goal implementation found in applications coming to light recently. What’s missing is the ability to plan ahead for significant fixed or irregular expenses.

Luckily, Microsoft Money also offers something called the Savings and Spending Budget. I turned that on immediately.

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I set up my Savings and Spending Budget, which basically says you should use 60% of your gross pay for committed expenses, 10% for retirement, 10% for long-term savings, 10% for short-term savings for irregular expenses, and 10% for fun money. I personally thought 10% for fun money was a bit high, so I brought that down to 5% and upped the 60% to 65%.

Things were looking good until I was told that I don’t track my gross income in Money, so my budget would never balance. I clicked through and was finally presented with a help screen on how I could set it up. Apparently I’m using Essential Bills, but I need to be using Advanced Bills… so from the Bills Summary I went to Other Tasks -> Change Bill Settings.

Finally, after getting that changed and entering my paycheck into the Paycheck Wizard, I was set. I headed back to the Budget and got another warning:

I clicked “categorize transactions” and I was presented with one for $17.05. I’m confused (again).

Rather than making the whole Budget work for me (because it wasn’t) I just want to make an observation. While the idea of the 60% budget is excellent, how Microsoft Money implements it is too presumptive at the outset. It requires a ton of tweaking categories to get it to fit in (to at least my perspective). For instance, each category belongs to one of those categories I mentioned above (Savings, Irregular Expenses, Retirement, etc.). MS Money automatically placed “Dining Out” into the fun money category…I didn’t like that 🙂

Also, I use my credit card each month and pay the balance in full every time. Yet to fit into this paradigm, it automatically includes Credit Card Payments/Transfers as Savings (and Debt). The balance on the card is always double-counted because I record the spending on the credit card (categorized as groceries or something like that) and then categorize the transfer to pay it off (the transfer is the aggregate of all those already-categorized transactions).

Granted, I can remove the category, and perhaps that’s what I would do. But the problem is that I’m tweaking and moving so many categories, the fact that MS Money did it for me starts to be eh, more annoying than anything else.

To be frank, this was one of the more difficult aspects to wrap my head around with Microsoft Money, the whole Budgeting concept.

Investing witih Microsoft Money

The Investing Home for MS Money is more like being on MSN Money than actually being in the software, complete with big advertisements and inducements to do this or that.

You can do all of the standard actions necessary to manage investments including adding buys, sells, accounts, etc. You can also review your portfolio based on return, asset allocation, valuation, fundamental data, etc. Again, this can be as useful as you want it to be, as long as you’re dedicated to inputting accurately all of this information.

Microsoft Money Planning

We’ve already gone through the Debt Reduction Planner, but there’s also the Lifetime Planner and the Financial Events Modeler. We won’t go into detail with those, but they’re basically financial planning tools.

Note: Be aware that the output from these analyzers are only as good as the inputs you give them (both known–how old you are now–and unknown variables–how long you’ll live. The advice of a qualified financial planner would probably do well to augment your work in this area. You’ll notice it’s very much integrated with the MSN Money webiste:

Taxes with Microsoft Money

The Tax Section of Microsoft Money leverages the MSN Money portal as well, complete with more advertisments… There isn’t much to do here, just a lot of reading material if you’re interested in tax law changes, or snagging some exciting forms and publications from the IRS.

Conclusion for Microsoft Money Plus Premium

Microsoft Money is a comprehensive program to manage your personal finances. Most of its features are only limited by your desire and ability to first understand and then implement some of the rather complex tasks associated with a program as in-depth as MS Money.

My personal take is that there’s too much with Microsoft Money and that the important money management tasks necessary for every person to make gains on their debt and savings are too difficult. I found a lot of the necessary tasks buried within the program, where it was tough to navigate and I was constantly losing “where” I was in the application.

Also, it should be noted that download features require an upgrade to the software every year or two (depending on the initial version you purchased — Essentials only lasts for a year — they’ll get you either way!)

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