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!
NeoBudget is basically a web-based envelope budgeting software, much like Mvelopes (though Mvelopes is more fully-featured, there are some things to like about NeoBudget’s “light-ness” as opposed to Mvelopes “clunky-ness”).
I dove right into NeoBudget to see how it all worked. Below is my experience.
Using the NeoBudget New Account Wizard
I clicked the large friendly green button and got started with NeoBudget’s new account wizard. The first step was to name the account (Checking). I was then asked to create envelopes for that account. I personally am not too keen on having specific envelopes married to specific accounts. What if I have a groceries envelope, but I use both a debit and credit card and various grocery stores?
I plowed forward despite what I saw to be a snag in their method, creating an envelope for things I know came out of checking (Gasoline, Mortgage, Babysitting, Utilities : Gas, etc.).
The next step was to set up some income. I entered that I’m paid $3,500 twice per month. Everything seemed to be going off without a hitch and I began allocating my two paychecks to envelopes. As you can see from the screenshots, allocation was pretty straightforward.
A quirk I found immediately annoying: you’d be presented with an option, such as creating an envelope, while in the allocation mode, but when you clicked on it you’d be warned that you’re navigating away from a page without saving… then why show the option?
At any rate, the final task was to enter my initial checking account balance. I did that, and allocated all of the funds to various envelopes.
See these screenshots of the setup process:
Setting Up a Credit Card in NeoBudget
I went to Settings -> Accounts -> Add a New Account and I was presented with the same dialog box asking me for a name and description. I did as much and the account was created with a single ‘unallocated’ envelope attached to it.
I was confused.
Where’s the handy wizard to walk me through setting everything up? How does this account handle the fact that it’s negative? I decided to just enter my own starting balance transaction, so I selected the Credit Card account and chose the ‘Subtract $’ option on the top right.
I entered a starting balance transaction and stuck it in the Unallocated envelope. It’s not very elegant (at all) but I think it’ll get me there.
Importing Transactions into NeoBudget
I downloaded a .qfx file from Wells Fargo for my credit card, but then was dismayed to see that NeoBudget supports only one single file format (the second-worst one, .csv being the worst): Quicken Interchange Format, or QIF. Luckily, my bank still supports QIF, so I downloaded that version instead (you may not be so lucky). Update: NeoBudget now supports OFX/QFX importing.
The import process was basically four steps. The first was to feed NeoBudget the QIF file, which I did. The second was to select the transactions contained in that file, that I wished to include. I selected all of them. The third step was to go through and clean up the payees (go from COSTCO #112 812-23-9838 to Costco) and allocate the transaction to a specific envelope. I was dismayed to see that I had to work through it completely linearly, saving and moving onto the next one, having to hit Tab a billion times, or click far too often than is really necessary. They need to revisit the tab order on that screen.
I imagine that people will spend a bulk of their time with NeoBudget in the import/envelope categorization process. It’d be nice if NeoBudget would devote some serious effort into making that process as painless as possible. Currently, it’s hardly bearable. Sorely needed features include auto-cleanup of Payees and auto categorization of certain transactions to envelopes.
Screenshots of the NeoBudget importation process:
A Walk Through NeoBudget
Due to the fact that I think the system is fundamentally flawed by not addressing credit cards in a usable way, I’m going to do the rest of this review by simply working through each of the feature areas.
Overview - The Overview gives you news and updates on the software, and an overview on the balances of your envelopes for your accounts. The pie chart shown is of little use since it only shows the two largest pie slices, grouping the rest into an ‘other’ category.
Subscription – The Subscription section lets you pay your $2.50 monthly fee (you can buy six months for a bit of a discount at $12.50, saving $2.50 or basically getting one of those months free). You can also refer a friend with a very large friendly green button.
Settings -> Profile – This is very basic contact information, password management. I do not like how NeoBudget automatically opts you in to their news and updates. Good tact would require that you let the user check the box to opt in.
Settings -> Accounts - Let’s you set up a new account, delete an account, or edit the name/description of an existing account.
Settings -> Envelopes – Here you can edit the names of envelopes, re-order them, or even change their color. I’m fairly dumbfounded by the fact that NeoBudget bothered to put in the coloring of envelopes before some other very obvious features (importing OFX/QFX files, for instance).
Update: The creator of NeoBudget, Luke (a nice guy on all accounts), informed me that NeoBudget does now support OFX/QFX importing.
Setttings -> Income – Here’s where you set up funding plans based on your income. You do this by account. Not much else to report here.
Worksheets – This is a strange place. NeoBudget has a separate feature to let you build out a debt payoff plan. I’m for paying off your debt and all of that, but honestly, this type of feature felt very out of place to be given such a prominent location (left-hand navigation) and then to simply be a debt payoff calculator…any number of which you can find online for free.
Help – Very sparse. You can contact email@example.com. Tutorials are (still) coming soon.
I find this particularly disturbing because much of these features are not particularly obvious. How do you handle the tracking of savings accounts? Do you set up a separate account for each? Set up an envelope for it? How do you handle transfers between accounts? Do you have a separate envelope for transfers?
Update: As of February you are now able to transfer money between envelopes.
Working with NeoBudget Accounts
Each account is broken down into a few different areas:
Summary – Gives you a look at each of your envelopes for that account.
History – Shows you a history of all transactions for that account. You can filter by envelope if you’d like.
Reports – You can view a trend line of your balance in a particular account, and also a trend line of your funding in envelopes compared to your spending (basically a variance or over/under analysis).
Balance – This section lets you balance your account to your bank. It’s very straight forward. You simply enter what the bank has and then make an adjustment for any differences that have cropped up.
Also under each account you can Add $, Subtract $ or Move $. I found these interfaces to be fine and understandable, but very slow. They’re not slow in the sense that the NeoBudget server is slow, but slow in the fact that there is no AJAX being used, so the whole page is loaded every single time a change happens, and the tab order (as mentioned above) is not geared toward quick receipt entry.
At $2.50 per month, or $12.50 for six months, NeoBudget is still too expensive for what it has to offer. While its direct competitor, Mvelopes, is about three times more expensive, you’ll find Mvelopes has far superior support and functionality. You’ll also find Mvelopes able to handle finances as applied to the real world (credit cards, savings accounts, etc. — not just some basic accounts). Update: Neobudget is now able to handle credit cards.
NeoBudget Overall Conclusion
NeoBudget has a nice clean interface and the direction they’re headed is sound. They need to clean up the interface from a usability standpoint to make sure they’re not requiring unnecessary keystrokes and clicks to get a job done. NeoBudget is definitely improving upon their featureset as is aparent in the recent upgrades. Is it the end all be all solution to your finances? Probably not yet, but it’s getting better. Ultimately it’s up to you to decide. Click here to visit NeoBudget.