Why I Don't Like Online Budget Tools

by Christy Bieber | Updated July 23, 2021 - First published on July 17, 2021

Many or all of the products here are from our partners that pay us a commission. It’s how we make money. But our editorial integrity ensures our experts’ opinions aren’t influenced by compensation. Terms may apply to offers listed on this page.
A woman dialing a number on her phone and sitting at a table with her laptop.

Image source: Getty Images

The reason may surprise you.

I am a huge proponent of living on a budget. I feel like virtually everyone should make a spending plan outlining where their money will go so they can use it as wisely as possible.

But while I think budgeting is extremely important, I'm not a big fan of budgeting apps that help with this process. Here's why.

Sometimes, the old fashioned way to budget is better

Although online budgeting tools can make budgeting easier, the big problem I have is that they can sometimes make things a little too easy and hands-off.

I believe the budgeting process should be about more than just setting spending limits and where you want your money to go. Budgeting can and should help you make value-based decisions about what's most important. It can also be a reality check that helps you see where you're overspending and whether you're sticking to your plans.

When you use apps to automate tracking spending, allocating income, or seeing where you went over or under your budget, it's far too easy to skip these steps and not really come to terms with what you're doing with your money.

By contrast, sitting down with a calculator and a piece of paper forces you to be more mindful. For example, actually adding up all those credit card receipts from lunches out and seeing just how many times you spent an extra $10 here or there can drive home that you're overspending -- much more so than just seeing your expenditures on a neat graph, or on a report from your budgeting software.

Likewise, deciding what spending categories to include on your budgeting spreadsheet or list and manually dividing up your income among them forces you to think about how you're distributing your hard-earned dollars, and whether it aligns with your goals.

If you use budgeting software that does the math for you, or provides suggestions for spending categories, you won't get the full experience of analyzing what areas you want to devote money to and working to make everything fit within your income.

How should you make your budget?

While I believe that, ideally, you should use a calculator and notebook to budget (especially when just starting), I realize that not everyone has the time or patience to do that.

If you aren't interested in drawing up a handwritten budget, then using a spreadsheet to make one can provide you with some of the convenience of modern technology while still getting you intimately involved in the process.

If you don't want to do even that much work, using budgeting software is far better than not having a budget. But if you find yourself not accomplishing your goals -- or if you have a hard time sticking to your budget -- try the spreadsheet or paper-and-pen method for a month or so, and see if it makes a difference. You may be surprised at the power of the old-fashioned budgeting process.

Alert: highest cash back card we've seen now has 0% intro APR until nearly 2024

If you're using the wrong credit or debit card, it could be costing you serious money. Our expert loves this top pick, which features a 0% intro APR until nearly 2024, an insane cash back rate of up to 5%, and all somehow for no annual fee. 

In fact, this card is so good that our expert even uses it personally. Click here to read our full review for free and apply in just 2 minutes. 

Read our free review

About the Author