Because online finance software products vary quite a bit in what they do and how they do it, it is important to know not only what features are most important to you, but also how you feel about security issues. Most software is either free or offers a free trial period, so in addition to consulting reviews, you can try it out for yourself, although getting your account set up can take some time.


Is it safe to store personal financial data online?

Security is a major issue to consider in choosing personal finance sites. Issues to think about include where your account data is stored, how well it is protected and what sort of personal information you have to provide when you sign up. Most experts say that data stored on a company's server is actually more secure than data stored on a home computer, especially since many owners tend to be lax about installing and updating security software on their home computers. ConsumerReports.org says that all four sites it tested -- Mint.com, Quicken Online (now being phased out), Yodlee.com and Geezeo.com (whose personal financial service is now discontinued) -- "passed muster" with Consumer Reports Webwatch, which checked their online privacy and security policies.

Companies that provide online financial management offer data security and encryption that is equivalent to that of banks and other financial institutions. Moreover, companies like Mint.com say that since the user provides only an email address, zip code and password when signing up for the service, data remains anonymous -- no name or Social Security number is attached to the accounts that are stored on their server. Finally, many companies contract out their automatic account aggregation service to a third party -- most to Yodlee, which also provides this service to major financial institutions (and has its own personal finance website). When a company uses an account aggregation vendor, its employees do not have access even to account numbers or data.

Some people still balk at the very idea of providing a third party like Mint.com login information for all their accounts. People with such concerns may be happier with desktop accounting software, or personal finance sites that do not require that you provide them with this information. Wesabe.com and Buxfer.com, for example, give users the option to export account data from their financial institutions' websites, then upload it to their Wesabe or Buxfer account -- thus no need to provide your login information. Both also offer automatic account aggregation as an option.

Beyond security and access issues, online finance software products differ greatly in terms of the features they offer or emphasize. Some have robust user communities and some excel at budgeting, while others allow users to track virtually all types of accounts and generate more sophisticated reports. Some offer online bill pay, others don't. There's also a niche group that helps to track group expenses, helpful for roommates or for managing shared travel expenses. Again, it's a good practice to take advantage of free trials or try out a few free services before committing to one.

Consider the following before signing up with any service:

  • Read the company's security and privacy policies, which should be available on its website. Check for certification from a reputable security company like VeriSign, Entrust or Symantec.
  • Check that your banks and other financial institutions are supported by the site. This will mostly be an issue if you use a small local bank or credit union.
  • Be sure the personal finance site you choose has easily accessible help features and customer support. Read message boards and poke around the site's help section to see how much information is available and how responsive the support team is. Some sites offer tutorials, interactive forums or even help via Twitter.
  • Decide whether you need complex spending and investment reports or basic reports that track recent spending and savings. Depending on your financial profile, some of these reports may be overkill or may provide too little information to be useful. Some sites excel at budget reporting, helping you to rein in spending and build up your savings account.

If you're looking for a desktop solution for tracking finances, see our report on accounting software. We also have a report that covers online bill paying.

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