Your computer won't help you get rich quick. But the right program can help you reach your financial goals faster and more safely.
Don't have any financial goals? We found some programs that can help you select some. They also can help you handle your present money and future finances.MoneyPlans is from Parsons Technology, which makes the very efficient personal accounting program, MoneyCounts. It costs $49 and runs only on IBM PC type computers.
Two others are made by Reality Technologies (who answer their phone, "This is reality"). WealthStarter is $80 and for IBM compatibles only. WealthBuilder by Money Magazine is a whopping $250 but available for Macs as well as IBM compatibles.
All three programs are very similar. They interview you with a bevy of personal and financial questions. You must type in your date of birth, present income, present savings, present house value (if any), mortgage and other debts.
Then they ask you to pinpoint financial goals: Do you want to save for retirement, educate your kids, take care of parents, buy a house or a boat - or just set aside a nest egg for some big purchase or vacation? You can opt to plan for a bunch of goals at a time.
All three programs use all this data to calculate long-term budgets that meet the defined goals. They print the budgets into neat forms on-screen or on paper.
The forms are useful. But you'll probably spend most of your time studying the graphs all three draw. For example, you can see a graph comparing your present financial status with what you're shooting for and how much you have to save or invest in order to meet your goals. Most relatively modern printers can print the graphs.
This is a start, but it's about as far as WealthStarter takes you - though it does add a useful loan balance calculator and loan comparer. You can use it to compare up to three loans with varying rates, points and repayment plans. You'll quickly see which loan costs you the least.
MoneyPlan's financial calculator has several additional useful problem solvers. It compares leases and loan deals. It also compares paying cash to using a loan. It canshow you whether it pays to cash in a CD and purchase another one at a different rate. It compares bond prices, rates, yields and premiums.
MoneyPlan also queries and comments on your insurance coverage. It has a database in which you can inventory all your household belongings. The inventory is valuable for estate planning and for making insurance claims.
WealthBuilder by Money Magazine is the most ambitious program. (At $250, it ought to be!) It begins by asking you to choose your basic economic philosophy: conservative, moderate or aggressive. Can you pinpoint where, between 0 and 5, you stand fiscally? For us, that's an awfully broad brush! We'd like to see all three programs show us comparative differences between several financial plans. Alas, none do.
But you can beat that fault by saving and printing the results of one financial planning session, then going back and changing one key variable at a time. By comparing printouts, you can see what small saving and spending changes do to your potential bottom line.
We turned around WealthBuilder's tools to arrive at our best investment philosophy. We began with the philosophy pointer right smack in the chicken-livered middle. At that setting, we answered all the goal-setting questions and had the program analyze our input. Then we adjusted the pointer upward and downward and went through two more scenarios.
By doing our own analysis of the three results, we came up with the wisest financial plan for us.
WealthBuilder does not include the utilities in MoneyPlan that can help you evaluate loans, bonds, and similar monetary papers. Instead, it substitutes advice on how to invest the money it suggests you use to build your nest egg.
We tried this feature two ways. For a low-risk plan, it told us to put 10 percent of our money in metals such as gold, 32 percent in equities and 23 percent in bonds. It urged us to keep 35 percent in cash. For a middle-of-the-roader, it still wanted 10 percent in metals, but apportioned 22 percent to cash, 21 percent to bonds and a big 47 percent to equities.
But we'd be crazy to take either set of advice.
First of all, it's based on stale data in a stock, bond and mutual fund performance file that comes with the program. When you register with Reality, you get a small database of stocks, bonds and mutual funds. To get a full set of data and keep it moderately up-todate, you must subscribe to Reality's quarterly World of Investment disks at from $100 to $175 per year.
If you skip the expense, you get a limited program whose investment advice is soon totally unusable. Even if you subscribe, you're soon basing investments on data one to three months old! The way the financial markets are jumping around now, that's nuts.
If you opt for WealthBuilder to use its wealth-building adviser, we urge you to compare its analysis with that of a professional financial advisor before you do anything rash.