Quicken 2006 "Real-Life" Review

If allyou're looking for is a stand-alone home budgeting program, then Quicken 2006 is probably not for you.

But, if you're looking for a robust program that will help you:

• track what you spend, save and invest and provide useful reports
• analyze ways to spend less, save more and invest better
• create strategies to fund life events, special purchases and eliminate debt
• estimate and save on taxes, and
• generate up-to-the-minute net worth snapshots

...then Quicken 2006 is definitely worth investigating.

Quicken 2006's budget feature shows great improvement over the Quicken 2002 version we last tested.

You can create a budget based on past spending, using average amounts for periods you specify, or actual expenditures for those same periods. You also have the ability to disregard one-time expenditures and control how far Quicken "looks back" to calculate your household budget.

You can also create budgets manually, from scratch. Personally, I don't have the time for that. (Why double your effort? We'd much rather track spending for a few months, then generate a budget automatically.)

If you already use an earlier version of Quicken, then you're golden. You can create a budget based on years of data you've accumulated.

Once generated automatically, you can then tweak your budget to get it as accurate as possible.

A great feature: Quicken 2006 lets you save more than one budget file, so you can create different scenarios to help you make important financial decisions.

For example, say you're expecting your first child soon. You'd like to quit your job to stay home and raise the baby. Simply open your current budget and delete your income. Then, tweak expenses to account for the fact you'll be eating out less, spending less on gas and clothing, dry cleaning, and so on.

Then save your "baby" budget and compare to your current budget to see what's feasible.

You can also generate budget reports comparing actual spending to all versions of your budget, helping you "try before you buy" and make realistic financial choices.

Our favorite feature of Quicken 2006 is its "savings goals". These are little "accounts" within your checking or savings accounts that "set aside" monies for special purchases, days from now or years down the road.

(NOTE: The savings goal feature is only available in Quicken 2006 Premier and up, not Basic.)

We've personally used this feature for as long as it's been available in Quicken to set aside money every paycheck for Christmas, vacations, tuition, large bills, non-monthly bills, and more.

Savings goals are easy to maintain and they provide a nice "cushion" in your bank account (never bounce a check again!). Simply decide on a goal, how much it will cost, and when you need to have the money in full.

Then, decide in which bank account (savings, checking, money market) your goal will reside. When you're ready to add money to your goal, click "Contribute" and the amount. The amount is subtracted from the Quicken balance in your bank account and added to the balance in your savings goal account.

Important: the money is still in your bank account. Your bank and bank statement won't know you've set the money aside. But Quicken will, and won't let you see that money as available to spend until you click "Withdraw" and put the money back into your account--usually when you've accomplished your goal.

We use this strategy to even out our cash flow, so we have the same amount to spend from every bi-weekly paycheck.

Larger monthly expenses are divided by two, with one-half going into a savings goal on the payday after the bill was last paid. When the next payday rolls around, we contribute one-half and withdraw the one-half already saved--ready to pay the bill in full!

Save fees and pay quarterly, semi-monthly and semi-annual bills when due instead of monthly. Simply divide the total bill by the number of pay periods involved and set aside that amount in a savings goal each payday. For example, we divide our semi-annual car insurance bill by 13 and put that amount into a savings goal every payday. When the bill is due, the money's there to pay.

You can also use this strategy to make sure you have the money set aside to pay credit card bills. This is especially handy if you want to take advantage of reward credit cards! Save your credit card receipts, and every couple days enter them into Quicken. (With Quicken's memorized entries it only takes a few seconds, since you usually spend at the same stores over and over.)

Every time you enter a receipt, click "Contribute" into a credit card savings goal for the same amount you charged. The money is "subtracted" from your Quicken checking account balance, and sitting in your savings goal ready to "Withdraw" and pay your credit card bill when due.

Besides all the tracking and planning features, Quicken's usability has been vastly improved since the 2002 version we last used. It took no time at all, and no peeks at the manual, to get up and running. Of course, we were experienced Quicken users.

If you're new, you'll want to take your time and utilize the terrific wizards and tutorials that Quicken 2006 provides.

Given the interface and features offered by Quicken 2006 Premier, we wholeheartedly recommend it as our TOP CHOICE for Home Budgeting Software!