I used to be a spreadsheet hater. As fellow personal finance bloggers talked about their favorite sheet setups or the latest versions of Excel, I turned the other way with disgust.
This year though, I really took to spreadsheets. Having closed out my Mvelopes account, I was looking for new ways to organize my financial information.
I created a bunch of spreadsheets with different functions, and I’ve discovered that there are some great benefits to “the sheet.” Here are a few of my favorites:
1. One of the Simplest Tools Around
There are very few things that beat a spreadsheet in the simplicity department. It’s tough to do when you’re built on the basis of an empty grid of boxes.
Spreadsheets have all the hallmarks of a simple system—a laser focus on your data, few essential features, simple formatting, and universal portability from system to system.
What spreadsheets may lack in built-in functionality, they make up in…the lack of built-in functionality. Sometimes simpler really is better.
The benefits, of course, are a cleaner and faster understanding of your financial picture than you could get anywhere else.
2. Customize Your Heart Out
There really are many ways to skin a cat. You may also have heard that you should make your money system your own if you want to be successful.
Spreadsheets make that not only easy, but default. It’s tough to do anything on a sheet without actually customizing it.
Customization means you can tailor exactly how you enter and display your data, controlling both the inputs and outputs. That means easier and more intuitive data entry based on your own account and account-ing system, and better and more accurate insights on trends and “big-picture” items that you want to see.
One of the primary reason I gave spreadsheets a try was the low cost of entry—zero. In a world increasingly filled with complicated, high-cost software options for tracking your finances, a spreadsheet is refreshingly accessible as the “universal” money manager.
One of the other benefits of the open-source nature of spreadsheets is the wide availability of templates for various money tasks, most created by people just like you, who are “in the trenches” and use them every day!
It’s very likely that you can find (and even build on) a spreadsheet that fits your exact needs—whether that’s a zero-based budget, an investment tracker, or a net worth calculator.
Spreadsheets…Cool People Use Them
Really, I thought they were just for math nerds (ironically, I think I’m in the group), but spreadsheets are really easy to grasp with a little practice.
Here are a few collections put together by fellow bloggers of useful templates for Excel and other spreadsheet programs:
- by Budgets are Sexy
- by Google Docs (via Get Rich Slowly)
- by Green Panda Treehouse
- by Christian PF
- by Money Under 30 (scroll down a bit)
Teaser: I’ll be releasing another spreadsheet template very soon, this one specifically developed for envelope budgeting. Stay tuned!
Today’s photo by Arbron
8 thoughts on “3 Reasons Why Spreadsheets Make Effective Tools”
I’m with you. I have had a spreadsheet which I’ve used to track my finances for over ten years now. It’s grown and evolved to meet our needs as things change, but it provides a running history of everything I’ve ever tracked during that time period.
Wow–how big is THAT file? 🙂 Isn’t it great that you’re still able to go back to all that historical info and slice it just about any way you want?
I love spreadsheets, too, but I would not call them one of the simplest tools around. They may be simple to you and me, but I bet you there are many people out there who find even an empty spreadsheet mind boggling.
Hmm, never thought about it that way! I guess to each his own, and you’re absolutely right!
I LOVE spreadsheets! I don’t use them to track my budget but rather I use them at work to calculate complex transactions, like estate taxes or converting to a Roth.
It makes it easier to see what is happening year to year rather than just depending on a calculator
That’s one of the best things I like about them. I’ve had Quicken files or MS Money files in the past I couldn’t open because I got a new computer or a new version, or some other excuse. I know I’ll always be able to open my spreadsheets!
I absolutely love spreadsheets! My wife actually got me a copy of MS Office for my birthday during our first year of marriage, because she knew I wanted the latest version of Excel.
To someone who doesn’t know anything about them, they aren’t that simple; however, once you get going, customizing them is unbeatable!
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