Primary Account System...
At Finance Victoria we use a Primary Account System to do budgeting. This simply means you pick one of your accounts to to be the primary pass-through of your cash flow. This is most likely your checking account. You can also add other accounts like savings, mortgage, credit cards, assetts, etc.) and tie them to a budget category from your primary account. You can track them independently, but by tying them to a budget category, you see how a change in budget impacts their future value. By focusing on a primary account, you can keep the process as simple as you want, or start adding secondary accounts to get a more holistic view of your finances. It is up to you!
Short to Mid-Term Planning...
Pretty much all budgeting websites and software look at a budget from a monthly perspective and that's all. At Finance Victoria we look at budgeting from a 1 to 2 year time period in monthly buckets. No budget is the same from month to month and making that assumption sets one up for failure from the start. For instance, almost everyone will have a higher "Gift" budget in December around the holidays or a higher "Travel" budget the month you want to take vacation. Our system allows you to plan for periodic and one time changes in budgets and make the right decisions to account for these changes. The Power of a budget is to see how it pays off in the long run. For example, you can tie a car loan account to your "Car Payment" budget category and see how much quicker you can pay down the load if you just add another $20 dollars to your payment each month. You could also tie a savings account to your "Savings" budget category, set a specific interest rate and see how much money you can save over time.
Customizable, Yet Simple!
No budget is the same. Our method allows you to customize categories and the accounts you set up. Some people have rental property, some pets, some children, etc. Set up your budget and categories to match what you spend your money on. Want to see how the future value of a secondary account changes as your budget or actual spend changes? You can set up customized secondary accounts as either assetts or liabilities. Tie these accounts to a budget category and see how their projected values change based on your actual spend from previous months and projected spend for future months! We will show you a sum of your assetts and liabilities to see what your net worth will look like over time. This is what budgeting is really all about! A key to making budgeting succesful is to make it simple enough to use. Some other sites have you fill in so much data (that is not necessary for effecive budgeting) that it becomes cumbersome and not usuable. Our tool is very simple to maintain which will make it a tool you will consistently use. After making your initial budget, maintain it on an ongoing bases by simply importing and categorizing transactions on a periodic basis. Our goal is to make things as simple as possible, yet provide the user enough data, in the right format, to make decisions that drive the best long term financial results.