Kimberly Palmer

A few years ago, Trevor Flannigan decided to start managing his budget using the online tool The 23-year-old district manager of a grocery store chain in Minneapolis suspected he could be spending less money each month, but he needed help organizing his various credit, debit, and other bank accounts. So he entered his nine accounts into the website and started tracking how much he spent.

The website now warns him when he approaches the limit of his monthly budget in different categories, such as eating out. "When I see I already spent x amount of dollars, I say, 'It looks like I'm having soup for the last week of the month,'" says Flannigan.

Flannigan is among the thousands of consumers who have incorporated online personal financial management tools into their lives. While they have been around for years, only recently have they started to really take off, with about 1 in 4 consumers using some kind of tool. "With the downturn causing more financial headaches for people, they've become a lot more disciplined, so they are turning to tools," says Ron Shevlin, senior analyst at the research and advisory firm Aite.

The tools are also much better than they used to be. They now allow users to automatically upload all of their financial data for quick analysis. Shevlin adds that the process has also become more fun, because some sites, such as, make it easy to compare spending habits with other users, which makes budgeting a more social process. "It shows you, 'People like you spent money this way,' so there's more of a context," says Shevlin.

A recent survey by Aite suggests that personal finance tools actually change people's behavior, too. In a survey of people who use such tools, 3 in 4 said they now have better control of their finances. Two in 5 said they are saving more money, and 1 in 5 said they are paying less in late fees.

Dozens of tools now exist, so how can you pick the best one for you? Here's an overview of 10 of the most popular options:

1) On, you can upload your account information and get immediate insight into where your money is going. You can then use that information to start saving more money, like Flannigan did. That ease of use makes it one of the top-rated tools.

2) also allows users to track where their money is going by uploading account information and reveals how their spending habits compare with others on the site. The social networking approach has its pros and cons; Some users say they enjoy the personalized tips but others find little use for them.

3) Geezeo offers its money management tools through banks and credit unions; It stopped taking on new consumer customers in January. But if your bank or credit union uses the program, you might enjoy using Geezeo to set goals and track your spending habits.

4) Yodlee also works with financial institutions to reach customers interested in online money management, but individual consumers can sign up for the service. Users say it's easy to upload their spending data and analyze where their money is going.

5) Pennyminder is ideal for families with multiple spenders because it allows users to see other family members' spending and jointly manage a household budget.

6) You Need a Budget is aimed at people living close to their budget and trying to pay off debt. The tool encourages you to decide where every dollar earned is going on a monthly basis, then helps you make adjustments if you spend too much.

7) Buxfer's simple design is appealing, as is the fact that users can sign in using a Google or Facebook account. It also has an easy tool for people who share expenses, such as roommates.

8) Pocketsmith focuses on calendar-based planning, which means it allows you to see how your monthly and annual expenses compare with what you bring in. It also encourages rigorous goal-setting.

9) Moneydance sells its desktop software for about $40 but provides an extensive free trial. Users say it's easy to use with responsive customer service help

10) Your own bank or credit union. About 1 in 4 financial institutions currently offer online personal finance management tools, but they don't rate as well with users as independent sites do. Respondents to Aite's survey said that tools not associated with banks and credit unions made it easier to see all accounts in one place, check balances, and categorize spending.

Keep an open mind, though, because banks and credit unions will be putting more effort into their offerings. In fact, Aite's survey found that 60 percent of financial institutions that don't currently offer personal finance tools are considered doing so. Banks, says Shevlin, are looking for ways to say, "We can help you," in order to forge stronger relationships with customers.

Flannigan, who also runs the website The Guide to Get Rich, says he'll continue monitoring his money habits online because he can see such a clear benefit. He says, "I've spent less money. It opens up your eyes to how much you're spending in each category and makes it easy to account for everything."


Personal Finance - Personal Finance Tools You Should Use Now

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