One Money Design

Mvelopes personal is a browser-based personal finance software application.  It’s best known for its budgeting and spending management capabilities by taking the physical envelopes budgeting methodology and converting it to an electronic version. 

For those who don’t an envelopes budget is a simple for of spending management in which cash envelopes are created for typical spending categories.  For example, after receiving your paycheck, cash would be deposited into the food envelope.  As you purchase food or grocery store items, you use cash from the envelope.  If the cash is used up before the end of the month or before the next paycheck, you withdrawal cash from other envelopes and avoid the use of credit cards.

The Mvelopes software essentially does the same thing by allowing you to create online envelopes and automatically or manually fund them with your paycheck after it’s deposited.  Each electronic transaction deducts from the envelope based on how the transaction is categorized by the user.

Overall, the software provides some nice features and advantages that enable you to keep a close eye on spending while at the same time, taking advantage of under spent areas by reallocating the cash.

Mvelopes Pros

Envelope Budgeting:  I think the concept of online envelope budgeting is an excellent idea.  A set of online envelopes can easily divide your checking account into different spending categories. 

With envelopes, you only need one checking account.  Some people use 2 or 3 checking accounts to separate expenses areas.  Well, this is no longer needed with the use of the virtual envelopes.

Browser-based software:  I like that Mvelopes has taken advantage of web-based technology.  There is no need to download or upgrade the software.  Traditional software requires purchasing yearly upgrades and this is becoming more and more a thing of the past.

Support:  While there is a learning curve, the support forums seem to be regularly visited and updated by users.  This is always important when starting off on a new software package and needing assistance.  There is also live chat, user guides and online tutorials that help.

Mvelopes Features

 Here are the core features I’ve found to be available with Mvelopes.

Budgeting: 

• Create a budget or spending plan using different spending categories.
• Track personal expenses against categories to see how much money is remaining for categories.
• Split transactions to multiple categories.  Some transactions, i.e., Wal-Mart receipts, may require splitting amounts between multiple categories.

Banking:

• Automatic download of account, balances and transactions from financial institutions.
• Reconcile manually entered transactions with transactions automatically downloaded from financial institutions.

Bill Pay:

• Pay bills from any of your accounts with online bill pay feature.  The feature automatically deducts balances from envelopes.

Debt Management:

• Set up a debt plan or pay off schedule to get out of debt.

Report Highlights:

• Cash flow report shows monthly spending in and out of the account by spending category.
• View and print a monthly budget.

Net Worth Monitoring

• Track your net work by measuring assets against liabilities.  This is a nice online feature to see where you are today in order to better determine where you need to go.

Mobility:

• Use software on a mobile device such as a Blackberry or iPhone to use features such as viewing envelope balances and creating transactions.

Mvelopes Cons

• The online envelope concept can take some getting used to.  There is a learning curve; however, it can be quickly overcome with the support tools and tutorials. 
• There is a cost to using Mvelopes where some products are now free on the web.  The cheapest option is $7.90 per month and you are charged a lump sum payment of $189.60 every other year.  A monthly subscription costs $13.20.

Future Enhancement Opportunities for Mvelopes

Note:  I didn’t come across these features, but if you know they are available, please share in the comments.

• Leverage across users, such as showing comparisons between prices when items were purchased at the same location.
• Expense savings opportunities.  Mvelopes doesn’t provide expense savings advice or information related to spending habits. 
• It would be nice to program alerts based on rules, i.e., alert me when an envelope reaches a certain balance

Should You Use Mvelopes Personal?

I think the return on investment is there with Mvelopes.  Personal finance software should help drive better money management processes or support the processes you have in place today. 

I think there is a lot of flexibility available in how you use the software, i.e., set up your spending plan.  It’s a tool that can remove a lot of the time associated with handling bank transactions and measuring expenditures against your budget.  It drives good money management practices.

The reporting allows you to get the information out of the system in such a way that you can make better strategic money management decisions.  As long as the data you enter is good, the reporting capabilities exist.

Mvelopes has a 14 day free trial.  I recommend signing up for the free trial to create test envelopes and transactions to better understand how the software works and to make sure it’s a fit for you.

Useful Links

• Learn about Mvelopes security
• I recently wrote a guest post at Christian PF about 4 notable features of Mvelopes Personal.  This is a good source for more in-depth information about some of the functionality.