I don’t know what’s wrong about publishing these days. Or maybe it’s always been this way. It seems you have to make an outlandish claim in order to grab people’s attention. The book isn’t necessarily bad but it’s way overhyped. The back cover has these in large bold colored font:

Everyone is telling you it’s a “no-brainer” to invest in a 401(k) or 403(b) plan because of the employer match.

What if everyone is wrong?

That sure arouses your interest, doesn’t it? Then it continues with (italics are original):

“[the book] challenges some basic assumptions about traditional retirement plans to reveal that:

• 401(k) and 403(b) plans are laden with Porky Pig fees, poor investment choices, and conflicts of interest.
• There is a simple way to make the smartest choices in these  plans — and this book shows you exactly what to do and which funds to avoid.
• There is one investment that could be the key to a successful retirement plan. You can do it yourself, with pre-tax or after-tax money. Create your own inflation-proof pension plan that is guaranteed to provide you with monthly income for as long as you live, and beyond!”

By this time, if you happily fork over $19.95 or whatever the selling price is, you will be disappointed. I was.

It turns out everyone isn’t wrong about the no-brainer 401(k) or 403(b) plans. Dan Solin admitted in the concluding chapter:

“I agree with most advisors who believe the corporate match of a 401(k) and 403(b) plan is too good to pass up. Investors probably should contribute to these plans — at least the minimum amount necessary to obtain the maximum employer match.”

So what about that thought-provoking question on the back cover, Mr. Solin? He could only plant some FUD about the possibility of retroactive taxation on 401(k) money and tax rates going up in retirement.

And what about the three bullet points on the back cover? It turns out:

• Some plans have high fees, but the match largely negates all that.
• “exactly what to do” is a short list of actively managed funds that look  like an index fund. With so many different plans and different fund options, that short list can’t possibly show everyone exactly what to do.
• That one investment that could be the key to a successful retirement plan is immediate annuity, which the author says is best bought at or near retirement, with 401(k) or 403(b) money. Solin only gave the topic 3 pages anyway.

I can’t help but feel duped. I thought it was going to show me I did it all wrong all these years by faithfully sinking the maximum into my 401(k) plan.

Don’t cut off your nose to spite your face. Yes, 401(k) and 403(b) plans can and should be better. But even if there’s no match, in all likelihood they still beat taxable investment after you max out your own IRA (either Traditional or Roth depending on eligibility and tax deductibility). Just remember to roll it over when you change jobs. See previous post Alternatives to a High Cost 401k Or 403b Plan.

I have serious doubt over the book market’s efficiency. This book got on the New York Times Best Seller list, but not John Bogle’s The Little Book of Common Sense Investing. Why? Is it because Solin advertised “smartest” but Bogle only wrote “common sense”? Who wants common sense when you can have the smartest?

Give me John Bogle or William Bernstein any day. I’m done with Solin’s books.

[Links to Amazon.com are affiliate links. Amazon pays me 4% - 6.5% if you make a purchase within 24 hours.]

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• Book Review: The Smartest Investment Book You’ll Ever Read
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The title is The Bogleheads’ Guide to Retirement Planning. It covers a wide range of topics on planning for retirement. The emphasis is on planning, not saving or investing for retirement, although there are still a few chapters on investing. It starts off with the planning process. Then it goes over the different savings and investment vehicles, investment strategies, how to make the most of social security, withdrawal strategies once you are retired, insurance, estate planning, how to find help if you need it and what to do if you face divorce or too much debt you can’t repay.

I like the broad approach in this book. Retirement planning is a complex subject. There can be full-scale books on each of the topics covered in this book. Every chapter covers the main points in about 15 pages so the size of the book stays manageable. If the reader wants to read more about a particular subject, there are a list of additional resources at the end of each chapter. The book serves as a good roadmap for retirement planning.

My most favorite chapters in the book are "Single-Premium Immediate Annuities" by Dan Smith and "Early Retirement" by Jeff McComas.

Most (all?) of the chapter authors are not professional writers. All the royalties from the book are to be donated to charity. The authors invested their time and effort into this book only because they wanted to help the readers. There is no hidden agenda to sell anything. I appreciate the wealth of information shared in this book.

Despite whatever impression you may get from this blog, writing is one of my weakest skills. English not being my first language does not help either. It took me several weekends to write my draft chapter. Without the great help from the editors, it would not be publishable as it is now.

You can tell this is still a finance book. It does not cover much non-monetary aspect of retirement planning such as finding the ideal location one would like to retire to. It’s heavy in information but light in step-by-step guides. There is no worksheet that helps one figure out the big numbers:

• Given what I have now and what I’m saving, when can I retire?
• If I want to retire in age X with a lifestyle budget of Y, am I saving enough now?

These are the things I will try to find out because I’ve set a goal for myself of retiring in 2020.

I would say this is a great book even though I’m biased because I participated in its creation. One of the best kept secret until now is the Bogleheads Wiki. The book mentioned the Wiki in many places. If you are not getting the book, at least bookmark the Bogleheaads Wiki. The depth of information on the Bogleheads Wiki is unbelievable.

[This post contains affiliated links to Amazon.com. Amazon.com will pay a commission of 4% - 6.5% to me if you make a purchase within 24 hours after you click on the link.]

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Software picked, likely related articles at The Finance Buff:

• I won the Bogleheads book contest!
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• Overhyped: The Smartest 401k Book You’ll Ever Read

Fellow blogger Mike Piper apparently agrees. He wrote a small book called Investing Made Simple. He’s making the PDF available as a free download until October 1. [Free PDF download is no longer available.]

Table of Contents

Introduction: Investing is Not Complicated

1. The Building Blocks
2. Types of Accounts
3. Risk and Return
4. How to Know How Much You Need
5. Don’t Bother Picking Stocks
6. Index Funds Win
7. Asset Allocation
8. Putting the Pieces Together
9. Think Long-Term
10. How to Find a Good Financial Advisor
11. Automate Your Investments
12. Beware the Hot Fund
13. Turn Off the Television
14. Steer Clear of Stock-Picking Newsletters

Conclusion – Keep It Simple

Appendix: Helpful Resource Guide

Simplicity wins. The simple approach is very straight forward. I was able to finish the book in half an hour. I agree with pretty much everything Mike wrote in the book.

I sent the link to several co-workers who asked me about investing in the past. If you have friends or family members who don’t have patience to read a larger book, send them Investing Made Simple.

Mike also wrote several other small books. If you find reading IRS publications unappealing or the 800-page J. K. Lasser tax guide too daunting, get Taxes Made Simple. It looks like a perfect gift book for someone who’s new to filing taxes.

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Those scripts will take care of the transactions. They will also update the prices for the securities held in the investment accounts that provide transaction download. However, if you have holdings in accounts that do not provide transaction download, the prices for those holdings are still not updated.

With the help of a book from the library, Learning Python, and a lot of Googling, I came up with a new script that gets the quotes from Yahoo! and writes a dummy OFX file for importing into Microsoft Money. Being a Python newbie, I’m sure the script can be made much more elegant, but what I have now works.

I tested it with Microsoft Money 2006. The online service in Money 2006 already expired. I created a new Investment account in Money called Dummy Investment. I ran the script, which imported a dummy statement with the current prices into the Dummy Investment account. Because the number of shares is set to zero (thanks to suggestion from John Brinnand), the import will not add any shares to the Dummy Investment account. It only updates the prices for your other accounts.

The script is very easy to use. You put the ticker symbols in two lists, one for stocks and one for mutual funds. Depending on how you set them up in Money, ETFs can be either stocks or mutual funds.

stocks = ["AMZN",
"GOOG",
"YHOO"]

funds = ["VTSMX",
"VBMFX"]

You still need either ActivePython 2.6.2 or Python 2.6.2. Then you just create a shortcut with

python quotes.py

Double click on the shortcut. Follow the prompts with a few more clicks and you are done.

Because it simulates importing a statement from a broker, Microsoft Money will only update the prices once per day. It’s best to run the script after the market closes. If you run the script more than once when the market is open, only the first price update will get into Money; you will not get the closing price.

With the Python scripts that download transactions and price quotes, I intend to use Money past its official expiration date.

---
Software picked, likely related articles at The Finance Buff:

• Replacing Microsoft Money, Part 2: Quicken
• Replacing Microsoft Money, Part 1: Requirements
• Smart Move: Microsoft Withdrew Offer for Yahoo!

This little book is all about the messy money dealings between family members and friends: lending and borrowing, gifts, inheritance, sharing expenses, disparity in income and spending priorities, keeping and breaking promises, and so on.

It takes a Q&A format. Every chapter is about one particular topic, with maybe 10 questions and answers in “Dear Abby” style. The answers are both serious and with a touch of humor. I enjoyed them and I learned a lot about human nature.

Money can become tricky when you are dealing with family and friendship. I’ve heard some people say “never mix money with family or friends.” After reading all the stories in this book, I can see why. Some people have different moral standards than we’d like. When these people happen to be in the family, they cause distress. Avoiding the problem preemptively is certainly one way to deal with it.

On the other hand, limiting financial dealings strictly to arm-length commercial transactions causes a lot of inefficiency.

If one family member has money sitting in a bank account earning practically nothing while another family member borrows from a credit card, it’s not efficient for the two of them collectively to have the bank earn the spread in the middle.

If two brothers have separate cell phone service with the same provider, they can get a family plan and alternate in paying the bills.

If two neighbors need Internet service, one of them can place a router in the neighbor’s home and share the same pipe. With the right wireless antenna, both can have satisfactory service.

You get the picture. It’ll be great if extended family members, friends, and neighbors can pool their resources and lower the cost for all involved, especially in difficult times. The problem is they don’t trust each other. If only people keep their promises, we will have much fewer problems in this world.

Take a look at this small book: Isn’t It Their Turn to Pick Up the Check by Jeanne Fleming and Leonard Schwarz. It’s entertaining and educational. You can certainly get a taste of it from the authors’ column Do The Right Thing on CNNMoney.com.

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I still haven’t found a perfect replacement for Microsoft Money. Money isn’t perfect either, but it’s working. Well, sort of. I already know the bugs and limitations and I know how to work around them.

Having suffered from being at the mercy of one software vendor, I really don’t look forward to jumping into the arms of another vendor with the same policy of automatically disabling features. Meanwhile, the contenders GnuCash and Moneydance still don’t match all the functionalities I’d like to have.

If only the downloading features won’t work in Money, why junk the whole thing? Why not just fix the downloads?

Having seen how GnuCash and Moneydance can download transactions directly from the financial institutions, I wondered if there is a way to use an alternative application for downloading. I can then import the downloaded files into Microsoft Money. If it’s only a one-time setup and a few more mouse clicks, I can live with that.

With the help of Google and GnuCash Wiki, I found two great Python scripts (ofx.py and ofx-ba.py). With some trial and error, I figured out how to use them on Windows.

[The rest of this post contains detailed technical instructions. I provide enough details to make it work even if you are not that technical. Skip if you are not interested.]

1. Download and install Python. I used ActivePython 2.6.2 for Windows. I think the 2.6.2 version from python.org will work too.

2. Download the Python scripts: ofx.py and ofx-ba.py. Just save them in a folder. Open ofx.py and ofx-ba.py in a text editor. You will see something like this:

sites = {
“ucard”: {
“caps”: [ "SIGNON", "CCSTMT" ],
“fid”: “24909″,
“fiorg”: “Citigroup”,
“url”: “https://secureofx2.bankhost.com/citi/cgi-forte/ofx_rt?servicename=ofx_rt&pagename=ofx”,
},
“discover”: {
“caps”: [ "SIGNON", "CCSTMT" ],
“fiorg”: “Discover Financial Services”,
“fid”: “7101″,
“url”: “https://ofx.discovercard.com/”,
},
“ameritrade”: {
“caps”: [ "SIGNON", "INVSTMT" ],
“fiorg”: “ameritrade.com”,
“url”: “https://ofx.ameritrade.com/ofxproxy/ofx_proxy.dll”,
}
}

These are the address and IDs used in downloading from the sample financial institutions. You will need the address and IDs for the financial institutions you use.

While you have the scripts open, make two small changes necessary for Windows. The scripts will not work on Windows without these changes. By the way, if you are still using Notepad, download and install the free, open source program Notepad++. Notepad will work. Notepad++ is much better.

Replace this line (line 2 in both ofx.py and ofx-ba.py):

import time, os, httplib, urllib2

with

import time, os, httplib, urllib2, uuid

Replace this line (line 37 in ofx.py; line 27 in ofx-ba.py):

return os.popen(”uuidgen”).read().rstrip().upper()

with

return uuid.uuid4().hex

Save the scripts.

3. Look for OFX settings. The settings for some financial institutions are listed in OFX Direct Connect Bank Settings on GnuCash Wiki. There is another searchable list at a web site OFX Home. If the companies you use are not listed there, you will have to find them yourself in the next step.

4. Download online banking directory. This is a zip file. Unzip the directory files into a folder.

If your zip utility can’t handle the .tgz file format, download and install the excellent open source program 7-Zip. You may have to extract twice: first from the .tgz file to a .tar file, then from the .tar file to the individual files. In the end, you will have 3 index files and more than 5,000 details files in a fi subfolder.

Suppose you are looking for the settings for a credit card. You open creditcard.xml in a text editor (open bank.xml for banks and brokerage.xml for brokerage).

In creditcard.xml, search for the name of the credit card company you are looking for. For example, for Chase, I find

<prov>
<name>Chase</name>
<phonetic/>
<guid>7685</guid>
<label>User ID</label>
<type>1</type>
<webcr>1</webcr>
<weben>1</weben>
</prov>

The number between <guid> and </guid>, 7685, is the key. It tells you which details file has more information for Chase. You open the details file 7685.xml in the fi subfolder. You look for 3 values in the details file:

<Org>B1</Org>
<FID>10898</FID>
… …
<ProviderURL>https://onlineofx.chase.com/chase.ofx</ProviderURL>

These are the values you need in ofx.py. By the way B1 means Bank One. Chase bought Bank One in 2004.

Find and gather all the values for each of your financial institutions.

5. Update Python scripts. Open the Python scripts ofx.py and ofx-ba.py again in a text editor. Replace the sample settings in the scripts with the settings for the companies you use. Give each entry a short name. Put Org in fiorg, FID in fid, and ProviderURL in url. Add or remove more entries in the “sites” area if necessary.

For credit cards, make them look like ucard and discover in the original ofx.py with a CCSTMT. For brokerage accounts, make them look like ameritrade in the original ofx.py with a INVSTMT. Add bank settings to ofx-ba.py. You will also need the routing number for your bank.

Just in case the financial institutions don’t like our scripts, replace

config["appid"] = “PyOFX”
config["appver"] = “0100″

with

config["appid"] = “QWIN”
config["appver"] = “1800″

This makes our scripts look like Quicken 2009 for Windows.

6. Run Python scripts. Open a command prompt (Start -> Run … -> cmd). For credit cards and brokerage accounts, type

python ofx.py [name of the site] [your online login] [your account number]

For bank accounts, use ofx-ba.py instead of ofx.py:

python ofx-ba.py [name of the site] [your online login] [your account number] [CHECKING or SAVINGS]

When you are prompted for the password, type your online password and press Enter.

The script will download a [site][yyyymmdd].ofx file. Open Microsoft Money. Double click on the downloaded .ofx file. The Microsoft Money Import Handler mnyimprt.exe will take it from there.

Upon closer inspection, I see the ofx-ba.py script can actually handle all types of accounts: credit cards, brokerage accounts, and bank accounts. I made additional changes to my script to make it work with Vanguard (hat tip to Costin Manolache). You can look at my modified script. It works with American Express, Chase, Fidelity, Vanguard, and presumably USAA (I don’t have a bank account to test).

So far, this is still not much different from going to each financial institution’s web site and downloading the transactions manually. With more modifications, I made the script:

• take the password as a parameter instead of prompting the user for the password
• trigger the Microsoft Money Import Handler automatically after each download

You can download my automated script. To use the automated script, insert your online password between your login and your account number. For credit card or brokerage account:

python ofx-ba-tfb-auto.py [name of the site] [your online login] [your online password] [your account number]

For bank account:

python ofx-ba-tfb-auto.py [name of the site] [your online login] [your online password] [your account number] [CHECKING or SAVINGS]

To download one account after another, a batch file calls the automated script for each account (remove the .txt extension from these scripts). Because you have to put your logins, passwords, and account numbers into the batch file, I suggest you put the scripts and the batch file on a portable USB drive. Plug the USB drive into your computer only when you import. Unplug when you are done.

I placed a shortcut to the batch file on my desktop. Now I have my own one-step update. In a round-about way, after looking at the alternatives, I realize I don’t have to replace Microsoft Money after all.

The files generated by these scripts only work with Microsoft Money. Attempting to import the same file into an older version of Quicken gave me this error:

[Update on Sept. 3, 2009: These transaction download scripts only update the prices of securities held at the institutions that provide direct OFX downloads. If you have stocks or mutual funds at institutions that don't offer OFX transaction downloads, you need a different script for updating the prices. See follow-up post Download Price Quotes to Microsoft Money After Microsoft Pulls the Plug.]

Once again, the downloads are:

• ActivePython 2.6.2 or Python 2.6.2
• The original Python scripts: ofx.py and ofx-ba.py
• (optional) A better text editor: Notepad++
• Online banking directory files for the server address and IDs
• (optional) A better zip/unzip program: 7-Zip
• TFB’s modified script for downloading interactively. Remove .txt extension. Test your settings with this one first.
• TFB’s automated script and batch file. Remove .txt extension.
• TFB’s script for downloading price quotes. Remove .txt extension.

Special thanks to:

• GnuCash community for the inspiration
• OFX Direct Connect Bank Settings on GnuCash Wiki
• Jeremy Jongsma for hosting the Python scripts and the OFX directory files
• Costin Manolache for the fix for Vanguard
• Google, for helping me find the resources above

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Software picked, likely related articles at The Finance Buff:

• Replacing Microsoft Money, Part 2: Quicken
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• Replacing Microsoft Money, Part 1: Requirements

This is part 4 in my series for replacing Microsoft Money. I gave my requirements in part 1. I looked at Quicken and GnuCash in parts 2 and 3. This time I’m looking at Moneydance.

Moneydance is a Java application that runs on Linux, Mac, and Windows. Unlike GnuCash, MoneyDance is not free. It’s made by a small company called The Infinite Kind. As far as I can tell, the application is primarily developed by one developer Sean Reilly. A Moneydance license costs $40. There is a trial version that limits to 100 transactions. I tested Moneydance 2008r4 on Windows.

Moneydance starts up quickly. The home page looks nice and clean. The default setup gives you a checking account, a savings account, and a number of income and expense categories. You can edit these income and expense categories however you want.

Moneydance is more intuitive than GnuCash. The terminologies are familiar. There are Accounts, Categories, and Securities. You can still nest accounts within another account. For example, you can create a sub-account in Savings for the next car and create another sub-account in Savings for the next vacation.

Figure 1: Moneydance home page

Entering transactions is somewhat non-intuitive. New transactions are entered at the bottom of the register, as opposed in the register itself. There is not a concept for a payee. The “Description” field is used for payees. Each entry in the bank account register uses two lines by default. There is no way to view only one line. You can choose to see only one line (see comment from Joe).

Figure 2: Bank account register

I was quite confused when I was trying to enter a stock purchase. The price per share is entered below the number of shares. I expected them to be on the same line. Every entry in the investment account register uses two lines. There is no way to view only one line.

Figure 3: Investment account register

Figure 4: Lot matching when selling a stock

Once I get over the register entries though, Moneydance works just fine. Loan payments can be automatically calculated to split between principal and interest. They can post automatically to the register monthly.

There are some reports in Moneydance but the reports are not very customizable. You can select one account or all accounts, but not some-but-not-all accounts. There is a report for capital gains and losses but I didn’t see anything related to investment return percentages.

If you’d like to see more screenshots, there are ten of them for Windows and Mac on Moneydance’s web site.

Here’s a summary of what Moneydance can do against my requirements:

Like GnuCash, Moneydance also imports QIF files. Moneydance provides step-by-step instructions for importing from Microsoft Money. When I posted a question about the instructions on their support forum, I got an answer in 15 minutes. That’s very impressive.

Unfortunately the answers from the Moneydance support staff were not what I was hoping for, although it’s not necessarily Moneydance’s fault. Importing QIF files still requires exporting from Money one account at a time. The transfer transactions in Money will likely create duplicates. They said it’s impossible for them to develop an importing tool that works on the entire Money file.

Overall Moneydance is a good application. I’m not used to its user interface in some areas, but I’m sure I can get over them. The prospect of taking off the straitjacket for downloading transactions and quotes is really enticing.

If I end up using Moneydance, I will just start fresh and not bother with importing.

---
Software picked, likely related articles at The Finance Buff:

• Replacing Microsoft Money, Part 2: Quicken
• Replacing Microsoft Money, Part 1: Requirements
• Download Price Quotes to Microsoft Money After Microsoft Pulls the Plug

This is part 3 in my series for replacing Microsoft Money. I gave my requirements part 1 and I looked at Quicken in part 2. This time I’m looking at GnuCash.

GnuCash is a free, open source application. It works on Linux, Mac, and Windows. I tried the version 2.3.4 on Windows.

I can see GnuCash is designed by people with a solid accounting background. It started in 1997 as X-Accountant. In GnuCash, everything is an account and every transaction is a transfer. That’s how an accountant sees things.

To an accountant, there is no fundamental difference between a checking account and salary. The checking account is a balance sheet account. Salary is an income statement account. But they are both accounts. When you put your paycheck into your checking account, you transfer a balance from salary to the checking account — debit checking account, credit salary.

That’s exactly how it’s represented in GnuCash.

Figure 1: Assets, Liabilities, Income, and Expenses are all Accounts

This flexible approach works great for an accountant, but it can be confusing for others. I would rather refer to accounts with my name as “accounts,” income and expenses as “categories,” and investments in my brokerage account as “securities.”

When it gets to investment, it can be even more confusing. Every stock you buy in a brokerage account is also an “account” with a parent account. You can create child accounts within the brokerage account for whatever tracking purpose: stocks vs. mutual funds, domestic vs. international, large cap vs. small cap, serious investment vs. play money, short-term investments vs. long-term investments, etc.

Figure 2: Accounts nest n-levels deep

If you have a good grasp of double entry accounting concepts, GnuCash is great. The infinite level of nesting lets you create your accounts structure however you like. To a novice, there can be a steep learning curve, until you understand why everything is an account and why every transaction is a transfer between two accounts.

On Windows, GnuCash takes a long time to start because it has to load the gnome libraries. After it starts, it runs pretty fast.

Here’s a summary of what GnuCash can do against my requirements:

There is no way to set up a loan and have it calculate loan payment principal and interest automatically. GnuCash provides a financial calculator for doing the calculation manually. The user can use the bank’s payment confirmation and enter a split transaction.

I did not see anything that calculates investment returns.

GnuCash also has some business features: customers, vendors, invoices, bills, etc. Because I don’t need these features, I did not test them.

Unless you use the business module, there isn’t a concept of a payee. If you want to see how much you paid AT&T over the last 12 months, you have to run a custom report off the free-text description in the register.

GnuCash can import QIF files. In Microsoft Money, you have to export to a QIF file one account at a time. I didn’t try the import because it’s too tedious with many accounts. It will likely create duplicate entries when there are transfers between accounts in Money. Fixing bad imports can be more time consuming than not importing at all.

If GnuCash were the only application on the market, I would use it. It’s very flexible for a power user. It’s great for a small business. It’s free and open source. Because it’s open source, chances are it will live on. For personal use, however, it’s not as user friendly as I’d like.

I will review Moneydance in my next post.

---
Software picked, likely related articles at The Finance Buff:

• Replacing Microsoft Money, Part 2: Quicken
• Replacing Microsoft Money, Part 1: Requirements
• Download Price Quotes to Microsoft Money After Microsoft Pulls the Plug

This is part 2 in my series for replacing Microsoft Money. In part 1 I laid out my requirements for the replacement application.

Quicken has been around for more than 20 years. It’s in stores everywhere. If someone is new to Quicken, there are many books about Quicken. Although its publisher Intuit doesn’t offer a free trial (there is a 60-day money back guarantee), I’m pretty sure Quicken can do everything I do in Microsoft Money. However, I’m a little worried about what Intuit would do after Quicken becomes a de facto monopoly.

Intuit says Quicken can import up to 10,000 transactions from Microsoft Money. They are working on a better importer that will do more.

The current version is Quicken 2009. The 2010 version will come out shortly. Intuit usually releases a new version of Quicken around Labor Day. The 2009 version is heavily discounted right now. The Deluxe edition, which I think will be adequate for me, costs only $20 at Amazon at this time (Amazon prices change daily).

Like Microsoft Money, Quicken also downloads account transactions and stock and mutual fund quotes online. Like Microsoft Money, Quicken also has a sunset policy for the download features (I forget who started this practice). The download features for Quicken 2006 was disabled on April 30, 2009. Customers were forced to upgrade. By inference Quicken 2009 will expire in 2012 and Quicken 2010 will expire in 2013.

If my other replacement candidates can’t meet my requirements, my default choice will have to be Quicken, although I really don’t like being forced to upgrade. That’s why I’m keeping my eyes open for alternatives like GnuCash and Moneydance. I will review them in the next two posts.

---
Software picked, likely related articles at The Finance Buff:

• Replacing Microsoft Money, Part 1: Requirements
• Download Price Quotes to Microsoft Money After Microsoft Pulls the Plug
• Replacing Microsoft Money, Part 3: GnuCash

Back in June 2009, Microsoft announced they would stop selling their personal finance software Microsoft Money. I have been a Microsoft Money user since it was Money ‘98. With Microsoft’s throwing in the towel, my current version will work as-is until September 2010. After that, two download features will stop working:

• download transactions from my banks, credit cards, and brokerage accounts from inside the money program, without having to go to the web site of each bank, credit card company, and brokerage firm
• download the current prices for my investments

Although I can still enter transactions or update prices manually, the download features sure make it much more convenient.

I don’t quite understand why the download service has to be disabled when they stop developing new versions of Microsoft Money. Can’t they offer the download service at $15 a year? I would pay it just to avoid the hassle of switching. Oh well, it is what it is and I’m looking for a replacement of Microsoft Money before that expiration date comes.

There are are number of free web sites that aggregate your transactions online. Mint, Wesabe, and Quicken Online are popular choices. But I’m old school. I prefer to keep those data on my own computer. I’m limiting my search to desktop applications.

Before I begin my quest, I wrote down exactly what I use Microsoft Money for. Ideally I’d like to maintain all these functionalities. I use them as my evaluation criteria for the replacement candidates.

• Categorize transactions in bank and credit card accounts, including splitting one transaction into several categories
• Download transactions for bank, credit card, and brokerage accounts
• Reconcile account balances against bank and credit card statements
• Maintain a budget and report income and expenses against the budget
• Track loan payments and allocate between principal and interest automatically
• Track investment values, purchases, sales, dividends, interest, and capital gains and losses
• Update price quotes automatically for investments
• Report investment portfolio returns over any period
• Report net worth over time

Ideally I also would like to import as much as possible from my existing Microsoft Money file into the replacement application.

My replacement candidates are: Quicken, GnuCash, and Moneydance. I will review them one by one in the next few posts.

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Software picked, likely related articles at The Finance Buff:

• Replacing Microsoft Money, Part 2: Quicken
• Download Price Quotes to Microsoft Money After Microsoft Pulls the Plug
• Replacing Microsoft Money, Part 3: GnuCash