Financial planning software can be an expensive investment in some cases, since some of the higher end software can cost upwards of $1200. Depending on what you need to accomplish, the more expensive programs may or may not be right for you. In the world of financial planning software, bigger is not always necessarily better. However, if your financial environment is a complex and convoluted maze of IRAs, CDs, annuities, college funds, 401(k)s, credit card debt and adjustable rate mortgages, it might do you more harm than good to shop for the lowest priced program available.
To understand fully why it might benefit you to buy a more expensive program or why it might benefit you to buy a less expensive program and what factors will determine each scenario, you need to have a basic understanding of how these programs work and what their intended goals are.
Financial planning programs are designed to simplify what can often times be a very complex financial situation. When faced with multiple different assets and debts, a financial climate with frequent and hard to anticipate variances, and a need to save money, these programs can be a life-saver. By organizing and simplifying the many complexities, it can be much easier to determine a path towards financial goals.
However some of the higher end financial planning software programs will not only clear up the confusion, but will also assist in mapping out a strategy for achieving your goal. Most programs will offer bar graphs and pie graphs as well as other charts reflecting the values of the status of your various different accounts. Additionally, the information from these accounts can all be accessed from one central location. So your stock portfolio, your retirement savings, your mortgage and credit card debt can all be cross referenced and analyzed in an integrated fashion to determine how best to achieve your target. Only some programs though will offer up suggestions as to which credit cards might provide cheaper rates and which banks might provide higher interest on your accounts.
Now that you have an idea of some of the capabilities of financial planning software, you can begin to address the issue of what price range would most appropriately suit your particular financial needs. Keep in mind that not all programs are better in proportion to their price. In fact, better is not an accurate term at all. The more expensive a program is will generally indicate how thorough or comprehensive the program’s functions are. Furthermore, some programs that might be a little more expensive might not have more bells and whistles than a program slightly less expensive. The price is just a general guideline.
On the lower priced end of the spectrum there is Quicken Premier for around $90 and the Deluxe version for around $60. The Quicken programs are for those that simply need help establishing and sticking to a budget. Programs in this range are most appropriate if there are a few credit cards, a 401(k) perhaps and the children’s college tuition to consider. There is not such a steep learning curve as the options are not overly detailed. This is precisely the type of program that would be suitable for someone with few financial complexities that is yet still interested in organization and some form of structure with perhaps a goal in mind.
MoneyTree Silver Financial Planner is closer to a mid-range program at about $495. This is just one example but programs around this range can generally handle additional tasks of a more complex nature. Most will offer the popular Monte Carlo simulation which can generate an estimated future path of your saving strategy with potentially negative randoms added in. This is also where the programs can start to become slightly more nuanced and complex requiring more detailed directions as well.
Software programs such as Naviplan and MoneyGuidePro represent the more comprehensive and higher priced end of the scale. MoneyGuidePro costs about $1295 so these programs are certainly only for individuals with quite extensive and complicated financial concerns. Every account is linked, all assets are integrated and a very detailed cash flow analysis is the result. Medicare premiums are considered against long term disability possibilities. Your portfolio’s quarterly changes will automatically adjust your path to attain your financial goals. Inflation will be automatically adjusted. But due to the considerably comprehensive nature of these types of programs by necessity the learning curve will be considerably steep. This however will most likely be worth the organization made from a considerably complex situation. Additionally a program such as this when used effectively can take the place of a costly financial planner in the form of a person.
Depending on the specific needs of the individual and what they feel they require for their finances will ultimately determine what program and what price range would be most suitable. Some with an extremely complicated financial affair might still be inclined to go with a pared down financial program and those with a more simplistic financial environment might still demand the over the top attention to detail abilities of a comprehensive high end program. However this article can provide a general guideline to be used as a starting point in the search.
Purchasing financial planning software depends solely on your needs and therefore some more expensive programs may or may not be the right choice.