Money Tasks Made Easy

From Kiplinger's Personal Finance magazine, June 2009

One of life's biggest challenges is keeping tabs on your spending, bill-paying and other money-management chores. But with tools available online, you can easily track spending, spot categories that are out of control and put bill-paying on autopilot.

The first step is to sign up at a personal budgeting site. We like Mint.com because it's easy to use. Once you provide user names and passwords for all your accounts, Mint gathers information from those accounts and tracks your cash flow, credit cards, loans and even your investments. You can see how much you're spending and where because the site -- with a little help from you -- assigns categories for income and outgo and reflects your spending in multicolored pie charts. (If you like the idea of getting organized but want to interact with other users, try Wesabe.com or Geezeo.com. Members set goals they share with the community and form groups in which they can support, inspire and advise one another.)

If you need extra motivation to achieve financial discipline, consider the budgeting software YNAB, which stands for "You Need a Budget." YNAB encourages you to follow certain budgeting rules. Among them: Plan ahead by living on last month's income instead of surviving paycheck to paycheck, and "give every dollar a job" by organizing your expenditures by category. As you set up your monthly budget, a box at the top of the page lets you see how much money you have left to spend. YNAB Pro software costs $49.95 (www.youneedabudget.com), but if you're not happy with the product after 60 days, you can get your money back.

Rebecca Bristol of De Pere, Wis., near Green Bay, started using YNAB after reading about it on a parenting Web site. The 35-year-old mother of three -- with a fourth on the way -- says she was "absolutely shocked" to learn that the family spent nearly $800 a month on groceries and eating out. After that, Bristol started shopping at a local warehouse grocer that has better prices than the supermarket close to her home. Plus, she committed to cooking six nights a week.

The result: She and her husband, Beau, 29, whittled the monthly food bill to $450. She also saves time by planning her menus each week and buying everything she needs during the family's weekly grocery-shopping trip. "I don't like worrying about money," says Bristol, who works part-time at a spa. "I just wanted to feel like I could control our finances, instead of having our finances control us."

Another way to gain a firm grip on your money as well as save time: Take advantage of online bill-paying through your bank. It eliminates envelopes and stamps, and if you have your bills e-mailed to you, you won't have to deal with a pesky stack of paper bills every month. With a couple of clicks, you can authorize your bank to make, say, your car-loan payment at the same time every month. For bills with variable amounts, you can initiate the payment each billing cycle. Online banking also eliminates the need to balance your checkbook -- your balances and outstanding checks are immediately available online (or through your budgeting program).

Before you sign up, see if there's a charge. Some institutions, such as Bank of America, Citibank, HSBC and SunTrust, offer free bill-paying serv-ices to customers who have online checking accounts. Others, such as Wells Fargo, require you to have a minimum balance in order to use online bill-paying without a fee. You can also sign up with billers for automatic deductions -- for your mortgage, credit cards, utilities, and bank or credit-union loans.

If you're stashing cash in certificates of deposit, you know it takes time to search for the best rates when your old CDs mature and you want to reinvest the money. Fidelity simplifies the process with its new Auto Roll program. You need a Fidelity brokerage account, but once you subscribe to the program, it will automatically reinvest your money at maturity by searching its inventory of more than 100 brokered CDs to find the highest-yielding equivalent. If no comparable CD is available, Fidelity will notify you and move your money to a cash account.

Consolidating your credit-card balances is another way to reduce hassles. Borrowing from a home-equity line of credit is one of the least expensive ways to pay off card balances and cut down on the number of monthly payments. But if you're low on equity, consider transferring balances to a single card. With today's rock-bottom rates, a number of card issuers are offering no- or low-interest deals for six months to a year. Check the cards in your wallet for offers, then compare them with the cards listed on LowCards.com. Its credit-card index tracks the annual percentage rates, grace periods and annual fees of more than 1,000 cards.

Howard Wallack, a 59-year-old retiree from Beverly Hills, Cal., shopped for new plastic for a different reason -- to make sure his primary card was paying benefits. Wallack signed on to BillShrink.com and, after taking a quick quiz about his bill-paying habits, learned that the American Express Starwood card would earn him nearly $7,000 more in travel rewards over three years than his low-interest Bank of America MasterCard. Because travel is a priority for him, he decided to switch. The new card will save him the hassle of having to search for cheap fares because once he accumulates enough points, he'll be able to book a ticket for free.

After you trim the number of cards in play, don't cancel the old ones. Eliminating credit lines could lower your credit score. To maintain the accounts, use them every six months or so and pay the balance at the end of the month. You can get a better understanding of what goes into your credit score at the Credit Education Center at www.myfico.com. That could save you time and stress later on.

MORE WAYS TO SIMPLIFY YOUR LIFE

Simple Investing
Streamline Retirement
Benefits With Less Stress
Lower Maintenance
Help With Home Tech
Goodbye, City Life
Take a Service Sabbatical
SLIDE SHOW: Zap the Clutter
SLIDE SHOW: Let the Pros Handle It
QUIZ: Lighten Your Financial Load

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