Mint.com review of new features

Mint.com’s New Features Put to the Test

The popular Mint.com free online budget service recently announced a “significant product upgrade.” Here’s a brief look at its new features organized by “Hits,” “Hits With Glitches,” and “Misses.”

Hits

Actual vs. Planned Spending.

Of all the new features, Mint’s most important improvement is that you can now see how your actual spending compares with your planned spending. This fixes what had been a gaping hole in an otherwise sophisticated and user-friendly service. Prior to this upgrade, you could see how much you spent in each of your budget categories in some past time period (last month, last quarter, year-to-date, etc.), but not how that compared with what you had planned to spend.

Income Planning.

I’ve always thought of a budget as a cash flow plan. Of course, cash flow pertains to both expenses and income. However, prior to this upgrade, you could set a budget for your spending, but not for your income. With this upgrade, Mint.com now tracks what’s going out as well as what’s coming in.

Budget Rollover.

Didn’t spend your entire entertainment budget this month? Now the unspent amount rolls over into the next month. By the same token, if you overspend this month, next month’s budget will show that you have less to spend. This new feature isn’t retroactive, but going forward it will be a nice upgrade.

Hits With Glitches

“Infrequent” Expense Budgeting.

Expenses that don’t occur every month but do occur at some point every year can be real budget busters. If you don’t plan ahead, that semi-annual property tax bill can be a real killer. Prior to this upgrade, you could plan for such expenses only by setting a monthly budget amount of one-twelfth the annual cost. For the months where you didn’t have the expense, Mint would show you to be under budget; for the months when you do have the expense, it would show you to be way over budget. The new release attempts to fix that.

However, there are two issues with this upgrade. When I tried to set up our next life insurance premium payment for July 2010, the drop-down list of possible months only showed 11 months including this month. There was no way to select next July. I talked with the folks at Mint and they told me that by the time this article appears that problem should be fixed (Mint gets lots of points for responsiveness!)

The other glitch in this new feature may be more difficult to fix. Let’s say you pay $300 for auto insurance every six months and your next payment is due in two months. Mint will tell you, “We’ll set aside $150 each month…” In other words, it assumes you have not been setting any money aside for the past four months. I talked with Mint Founder and CEO Aaron Patzer about this and he said, “Something like this is trickier than you can imagine, and complexity is often the enemy of personal finance.” However, he suggested that a button could be added where users indicate whether they’ve been setting money aside for the upcoming expense. At this point, it’s just an idea.

Misses

Budget Overview.

In the “Overview” tab, Mint.com provides a helpful snapshot of how much of your monthly budget you’ve spent so far. However, it adds a somewhat unhelpful analysis of categories listed under the headers “On Track,” “Slow Down,” and “Over Budget.” I don’t have an issue with “On Track,” which lists categories where you have not exceeded your monthly budget, or “Over Budget,” which speaks for itself. However, “Slow Down” is meant to highlight categories where you have spent at a pace that Mint deems to be too aggressive given how much of the month remains. Strangely, our mortgage payment showed up under “Slow Down.” Apparently, since we pay our mortgage early in the month, Mint somehow thinks we’re on a pace to overspend in that category. Patzer acknowledges that it “doesn’t quite make sense” to include such categories in its “Slow Down” analysis.

Geographic/ Demographic Comparisons.

Many new graphs are available with this new upgrade, including comparisons on how your spending by category or merchant compares to national, state, city, and soon even demographic averages. The problem is that we are not exactly a country of wise money managers. So, if the average person carries a balance on their credit card and doesn’t have an emergency fund, what are you really learning by comparing yourself to them?

Freecreditreport.com.

This “miss” is actually nothing new, but it stands out like a sore thumb that refuses to heal. Mint makes its money from sponsors who pay to be among companies recommended by Mint in its “Ways to Save” tab. While Mint’s promotion of its sponsors is not intrusive, the fact that the company works with Freecreditreport.com runs counter to Patzer’s contention that it only presents offers that will actually save people money. With Freecreditreport.com, the “free” credit score it promotes is available only if you sign up for its $12.95-per-month credit monitoring service. To get your score for free you have to remember to cancel the service within seven days. Mint would show that it really has its users’ best interests at heart if it stopped working with Freecreditreport.com. However there are some options that allow you to get a free credit score without a credit card.

Conclusion

All in all, I’m a fan of Mint.com and the recent upgrades add up to a great overall improvement. The only major item still on my wish list is a better way to track the use of cash. Right now, when you withdraw cash from an ATM, you have to keep going back to that withdrawal to categorize your use of the cash as you spend it. Patzer says a planned December upgrade may automatically transfer ATM withdrawals into a cash account where you can more easily categorize your use of the money.