If you’re trying to take control of your finances, you likely know that following a budget and tracking your cash flow are two behaviors you need to master.
Sure, you can go old school and do it with a pen and paper or an Excel spreadsheet. But, if you’re more technologically inclined, you may prefer to have your complete financial picture at your fingertips.
These days, there are dozens of financial management apps that connect directly to your accounts and automatically import your data – taking most the work out of tracking income and expenses. Many of them also allow you to build custom budgets and track your net worth. Pocketsmith is one.
In some respects, Pocketsmith is one of the most powerful financial tools on the market. With that said, it’s not for everyone. Let’s take a look and see if it’s a good fit for you.
Pocketsmith at a Glance
- Financial software that tracks accounts, income, and expenses
- Three pricing plans (including a free tier)
- Syncs to over 10,000 financial institutions across 36 countries
- Automatically imports and categorizes transactions
- Unique financial projection tool shows how today’s decisions impact your future
- Net worth tracking
- Multi-currency capability
What is Pocketsmith?
Pocketsmith is a financial software program that helps you track your accounts, income, expenses, and net worth. You can use it to build budgets, keep your bills organized, and even see how the money decisions you make today will impact your financial future.
Once you sign up, they will direct your attention to a four-item checklist you must complete to get started. The first item of business is connecting your accounts. The paid plans sync to your bank accounts and automatically import your transactions. If you’re currently using another personal finance tool like Mint, you can import your data directly to Pocketsmith (they’ll tell you how).
From there, you’ll categorize your transactions, create budgets and forecasts, and view your personal digest. There are detailed instructions and tutorials for each step if you need help.
To get the full Pocketsmith experience, log online anywhere to use the cloud-based service. You can also use a streamlined version on-the-go with the iOS and Android apps. Your connection is always encrypted, and Pocketsmith offers optional 2-step authentication for added security.
One of Pocketsmith’s coolest features is cash flow forecasting. In fact, they describe themselves as a time machine for your money.
Depending on which plan you choose, Pocketsmith calculates financial projections 6 months, 10 years, or 30 years into the future, based on your budgets. You can even run “what if?” scenarios to see how certain choices will affect your financial picture.
Pretty neat, right?
How Much Does Pocketsmith Cost?
Pocketsmith offers three pricing plans:
- Basic – Free
- Premium – $9.95 per month (or $90 annually)
- Super – $19.95 per month (or $169.92 annually)
The Basic plan lets you work with 2 accounts and 12 budgets. It provides a 6 month projection so you can see how your financial situation will unfold based on your current decisions. It doesn’t sync to your bank accounts, though, so you’re looking at manual imports. This restriction, along with the 2-account limit, makes the basic plan unworkable for most people.
The Premium plan offers automatic bank feeds, imports, and categorization. You get 10 accounts and unlimited budgets, plus a 10 year projection. At $9.95 a month, it’s not cheap, but this is the plan you’ll have to spring for to really benefit from Pocketsmith. You can save $30 by paying annually, though.
The Super plan includes all the Premium features but adds unlimited accounts and a 30 year projection. People who have more than 10 accounts will need the Super plan, but they’ll have to pay for it.
Top Features of Pocketsmith
Automatic Bank Feeds
Pocketsmith connects with over 10,000 financial institutions across 36 countries via their bank feed provider, Yodlee. This means you can connect to your bank, sync your accounts, and import your transactions automatically. You can connect multiple accounts from multiple banks (although Basic plan holders can only connect two accounts). Pocketsmith can even track accounts in different currencies.
Transactions are imported once or twice in a 24-hour period. While it’s pretty fast, it’s not instant. That means very recent transactions may not show right away.
Not having to import your transactions manually frees you up to focus on some of Pocketsmith’s cooler features, like cash flow forecasting. And let’s be honest: Budgeting and expense tracking are much easier when you don’t have to track your expenses manually. And the easier something is, the more likely you are to do it consistently.
When setting up your bank feeds, you can choose to categorize your transactions automatically as they come in. This means less work for you, but there will always be instances when Pocketsmith gets it wrong. After all, how are they supposed to know that the $50 you spent at Walmart was pet supplies and not groceries or clothes?
If you opt to categorize your transactions manually, you can tell Pocketsmith to remember your selection and apply it to all future transactions at the same merchant. Pocketsmith also lets you create your own categories, which is pretty sweet. There’s also a section where you can input notes about your purchase. That might come in handy later when you’re trying to remember why you spent $300 at Costco last month.
Side note: Pocketsmith has a very effective search engine you can use to find transactions later.
Budgeting and Cash Flow Forecasting
Pocketsmith’s most unique feature is financial projection. When you add a budget, you’re creating a plan for your earning and spending. Adhering to that plan affects how much money you’ll have in the future. That’s a no brainer, right?
Pocketsmith helps you get very specific when creating expense and income budgets. For example, when creating a budget for your salary, you’d specify that it’s income, that it repeats every two weeks, what the amount is, and the account it goes into.
You do the same thing with any other income and all your expenses. You’re not limited to monthly budgets, either; you can make them for any time frame.
Now that you have a plan for how and when money will flow in and out of your accounts, Pocketsmith knows how those accounts will look at any point in the future. With the Super plan, you can see as far as 30 years ahead!
You can even use the forecasting tool to create “what if?” scenarios to test the impact of financial decisions. How would your cash flow change if you cut your restaurant spending? Could you get by with a reduced income? Pocketsmith lets you test out these possibilities and proceed with confidence.
Interacting with your budgets is super-easy using Pocketsmith’s intuitive calendar. You can quickly see any scheduled transactions and check your projected cash flow for any given day.
Net Worth Tracking
Currently, Pocketsmith lets you connect bank, credit card, and loan accounts. It doesn’t connect to investment accounts. Obviously, though, investments need to be accounted for when calculating net worth. Other assets, like your home, also need to be included.
Pocketsmith lets you add additional assets and liabilities through their net worth tool. It’s pretty detailed—you can set an interest or depreciation rate and link corresponding accounts. For example, if you added your home as an asset, you could forecast its expected appreciation and link it to your mortgage.
Once you’ve added all your assets and liabilities, Pocketsmith calculates your net worth. You get an easy-to-understand summary of what you own and what you owe, so you always know where you stand.
Who Should Consider Pocketsmith?
- Anyone Who Wants to Take Control of Their Finances – Pocketsmith is a robust financial management tool that can help you get on top of your financial situation. If you’re looking for help building budgets, tracking your spending, and understanding how your current money decisions affect your financial future, Pocketsmith is a good solution.
- Anyone Who Wants Flexibility in Budgeting – Pocketsmith’s budgeting tool is incredibly flexible. You can make budgets for any time frame and create customized categorization for your transactions. The interactive budget calendar is easy to use, and the cash flow forecast is a unique feature many will enjoy. Just be wary of the Basic plan, since it only includes 2 linked bank accounts.
- People Who Hate Ads – Pocketsmith is expensive, but one benefit that comes with that is an ad-free user experience. If you’re annoyed by the ads that free financial apps run to make money, you’ll enjoy Pocketsmith’s lack of ads.
- Expats – If you’re living away from home, you’ll be pleased to know that Pocketsmith (which is based in New Zealand) connects to financial institutions in 36 countries and supports multi-currencies.
Who Should Avoid Pocketsmith?
- People Seeking a Free Option – Yes, Pocketsmith offers the free Basic plan, but unless you only have 2 accounts and are down with manually importing your transactions, it’s not robust enough. To get Pocketsmith’s full benefits, it’ll cost at least $90 a year. If paying for financial software seems counterintuitive or just isn’t in the budget, stick to free alternatives like Mint.
- Anyone Who Wants to Track Their Investment Accounts – A major drawback of Pocketsmith is that it doesn’t track investment accounts. While it’s great that you can add your investments to your net worth, it sucks that you can’t track them like a bank account. Many people who use financial software crave the simplicity of tracking all their accounts in one place. For people who need to track their investments, Personal Capital is a good (and free!) alternative.
- People Looking for Bill Payment Capability – Although Pocketsmith allows you to track your bills, there’s no option to pay them using the platform. If you’re looking for that functionality, check out Quicken.
Pocketsmith is among the more robust financial software options available. Its budgeting tool is flexible and detailed, and the financial projection component sets it apart from the pack. While it is easy to understand once you get the hang of it, there’s a bit of a learning curve starting out, since it’s so thorough.
With that said, it’s disappointing that an otherwise powerful tool doesn’t offer investment tracking or bill pay. You can manually add your investment assets so they factor into your net worth, but that requires you to update the values as they shift. If investment tracking and bill pay are important to you, skip Pocketsmith and look for a tool that does everything you need.
The other downside is the price. The Basic plan is free, but it’s just too limited. Manually importing transactions is too much work for most people, and two accounts just aren’t enough. At the very least, most people have a checking, savings, and credit card. If you’re set on getting a free app, there are better options available.
The paid plans, however, offer convenience and flexibility. If you’re willing to pay $90 a year, I recommend the Premium plan. Most people can manage with 10 accounts, and honestly, 10 years of financial projections is enough since it doesn’t track investment growth, anyway.
Have you tried Pocketsmith? What’s your take?
- Commissions & Fees
- Mobile App
- Ease of Use
- Range of Product Offerings
Pocketsmith’s budgeting tool is flexible and detailed, and the financial projection component sets it apart from the pack. While it is easy to understand once you get the hang of it, there’s a bit of a learning curve starting out, since it’s so thorough.
With that said, it’s disappointing that an otherwise powerful tool doesn’t offer investment tracking or bill pay. You can manually add your investment assets so they factor into your net worth, but that requires you to update the values as they shift.
The other downside is the price. The Basic plan is free, but it’s just too limited. Manually importing transactions is too much work for most people, and two accounts just aren’t enough. The paid plans, however, offer convenience and flexibility. If you’re willing to pay $90 a year, I recommend the Premium plan.