My concerns about putting my personal finances online
11 December 2007
4 Comments
There are plenty of online applications out there for managing your expenses. They range from the simple expense trackers, like Xpenser to the very in-depth financial management solutions, like Mint.
Now, I recognize that there are plenty of benefits to using these online applications: I could access all of my financial information from just about anywhere in the world, and if something was to happen to my home or office, I’d have a back up to that shoebox full of receipts in the corner. And, personally, I love the very nice user interfaces that most web 2.0 applications offer up: most of my life is handled online these days.
Yet, I’m still reluctant to hand over all my financial data to an online application. My biggest concern is security. Mint won’t let you just crawl around looking at their security measures, but I really have no proof of how strong their security measures are. I’m not accusing these sites of relying on no one trying to hack their databases, but that sort of financial information is what identity thieves dream of at night.
Another thing I worry about is what these companies get out of offering these great services for free. I know that the standard model for a web application is to rely on advertising, but I’m willing to bet that most have at least thought of other ways to capitalize on all this information. For instance, if a site offers an invoice tracking application with the ability to email out invoices, they build up a hefty little list of email addresses very quickly. There are a thousand ways to benefit from such a list, including selling it to spammers.
And what happens to all that data I’ve made sure is entered if the site goes out of business? Only a few offer a way to export data to a form usable by another application. It’s only helpful, also, to export that information if you have some advance warning of the impending closure. We’ve all seen websites happily chugging away one day and visit the next day only to find that someone’s posted a notice that they’re gone and they won’t be back. Not a reassuring situation.
I’m sure I’ll eventually convert my finances over to a web-based application. While I’ve focused on the negatives, there really are a lot of positives. But I do intend to wait a bit and see if any of the options address my personal concerns.
Very valid concerns Thursday. In the age of hackers and identity thieves preying on vulnerable websites, I ended up sticking with offline programs like MS money and it just connects with my online banking, CC’s etc. I tried mint but I didn’t like the idea of it being online as well. Matter of fact I have to go and close that Mint account.
I posted about the same concerns about Mint and got some reassurance that the info is safe - there was some technical jargon that made it sound good, so I am still thinking about it. I guess I’m just trying to give it some time to see if anyone can hack Mint. After it’s been a while, I probably will give it a try, since the expense tracking is supposed to be fantastically easy.
We’ve already seen Quicken (and possibly MS Money?) transition from selling software to essentially selling a subscription to Quicken (online functionality expires after a few years, the only way to reactivate the service is by buying a newer version).
What are the odds that these “free” online services will eventually require a regular subscription fee.
Thursday, I’m not sure why you are going to “eventually convert my finances over to a web-based application. The only significant pro you made was online storage protects you from any disasters that might happen at home.
It seems equally likely to me that a disaster could happen to your data online. Besides, financial backups are pretty easy to do. There are a variety of ways to store a copy of your data outside of your home.
I find the ability to access my data from anywhere very important. Even if I’m only traveling between an office and home, I like knowing that I can check on that information, without lugging my laptop along.
And I do have to say that the user interfaces are much better than some of the software options out there. Mint’s expense tracker, as Chief Family Officer said, is a much better option than Microsoft Money’s options.
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