I’ve tried out a few financial management applications in my day, not limited to MS Excel, MS Money, and Quicken, and I can’t say that I have been in any way impressed with any of those approaches.  They require a lot of work to set up, a lot of work to maintain, and in some cases (here is looking at you, Quicken), just plain don’t work at all..in my seemingly endless quest to get a budget going, I have typically ended up giving up.

That said, it was with both hopeful optimism and well-deserved skepticism that I started playing around with Mint.com a few months ago.  Mint.com is a free online financial management application with the ability to automatically connect to over 5,000 financial institutions to import transactions and help you manage your financial life.  Desperately wanting some solution to make managing my finances easier, I put aside the inherent security concerns of having all of your financial life located on some company’s servers, and dove in.

My overall feeling of the site is impressive.  Unlike Money or Quicken, Mint.com had no troubles accessing my checking account, savings account or credit card information.  It also did a rather good job at automatically categorizing my transactions- obviously there are some things it is not going to get, and for the most part this can be trained in with rules, etc.  But not having to manually classify each of my several hundred transactions gives it a definitive advantage over its desktop-bound competition (that, and being able to get to it from anywhere, obviously).

It also does an adequate job of giving you a high-level few of your spending trends.  In my experience, this feature has been a little buggy, but that is potentially to be expected since Mint.com is still in “beta”.  To give you some level of control over your transactions, you can split them and give them custom labels/tags and/or notations.  You can also rename them to suit your liking.

Where they make there money is recommending a number of potential options to help save you money, leading to potential referrals and therefore revenue.  In most cases, this means recommending a credit card with either a more compelling rewards program or a lower interest rate.  In could also recommend a higher yield savings account, etc.   I think this is a pretty neat feature, and I’m curious to see what savings I can get from it over time.

Soon to be added features include the ability to link to investment/retirement accounts and loan/mortgage providers.  It can already attach to my retirement account, but doesn’t do much more than show me the balance.   And once it is able to connect to my student loan provider, I can have a complete and clear picture of my financial life…right?

Not so fast.  Although Mint.com is clearly my favorite of the financial applications I’ve tested, it is not without its drawbacks.  From a feature standpoint, it is missing what I consider to be an essential one: the ability to manually add or import transactions.  Most, but not all of the money I deal with passes through those various financial institutions, but for the money that doesn’t (cash) there is not away to manually add the transaction.  I really hope they add this ability soon.

Furthermore, it does not have a built-in reconciliation feature. For some people, simply labeling a transaction as “Reconciled” might suffice, but if you’re looking for a fully featured checkbook-balancer, you may have to go elsewhere.

Also, it does not give you a clear picture of what your income versus expenses are, which I think is a critical part of budgeting.

There are, though, the security concerns of putting all of your eggs in one basket- and someone else’s basket.  While Mint.com goes a long way to reassure users that it is secure (several privacy/security notices are present throughout the site, and you can’t actually DO anything with your accounts through it), its still a risk.

Altogether, I really like Mint.com and hope they continue to add new features and fix a few bugs here and there, so that it becomes a truly complete financial management application.  It certainly seems that is is on the right track.