This App Will Help You Track Your Way to Financial Independence

by | BiggerPockets.com

I don’t care about real estate. Deal hunting, landlording, flipping, nor wholesaling gets me out of bed in the morning.

I care about financial independence. Real estate just happens to be the most proven strategy to attain financial independence. This is why I invest in it.

To date, I have completed two buy-and-hold house hacks. My first was in June 2017. The second was in June 2018. My intent is to continue house hacking and buy new properties each year until I feel that I am financially independent.

The question is: how can I tell when I’m financially independent? There is no one answer, and it is different for everyone. It all depends on my financial position and my spending. Once I am in a financial position such that my passive income exceeds my expenses, I have achieved financial independence.

How can I tell when this equation has been satisfied? Well, I can’t. Unless I track it. As Peter Drucker said, “If it isn’t tracked, it isn’t measured.”

There are many tracking tools out there, but one of my favorites, and one that I have used for over three years is Intuit’s Mint product.

Related: 12 Game-Changing Productivity Apps For Real Estate Investors

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What is Mint?

Mint is a personal finance tool that comes in the form of an app and a website. It has capabilities that allow you to set up a budget, track your expenses in order to stay within said budget, and track your net worth and credit score. These are the functionalities that I use the most, but other features include goal setting, investment outlook, and a “Ways to Save” affiliate program.

Let’s dive in to each one.

Track Expenses & Set a Budget

The first step in getting your financial house in order is to understand where your money comes from — and where it goes. Mint is great for this!

With Mint, you hook up all of your bank accounts, credit cards, brokerage accounts, retirement accounts, mortgages, car loans, student loans, tangible assets (house, car, boat), etc. Once everything is hooked up, any transaction going through these accounts will be automatically recorded (and sometimes categorized) in Mint.

You can always go online or into the app to see how you are doing in a given month. An example of how the budgeting works can be seen in the picture below:

 

This person is doing fairly well. They are below budget in almost every category. Restaurants is the only one where they have exceeded their budget by $71.44.

Tracking Your Net Worth

Track My Net Worth is my favorite feature within Mint. Mint aggregates all of your assets, including all checking, savings, brokerage, and retirement accounts, plus tangible assets like real estate, automobile, and boat values.

It also tracks all of your liabilities: Credit card accounts, mortgages, student loans, personal loans, etc—in real time.

By subtracting your liabilities from your assets, you get your net worth. Mint gives you a real-time look at your net worth and can also track it for you under the “Trends” tab.

This shows you how each individual transaction you make impacts your net worth. For me, this is a motivator to not spend frivolously, as I know it has a negative impact on my net worth.

Credit Score

Your credit score is incredibly important to track. If you ever want to get a loan or a rent an apartment, you will need to have a respectable credit score. If you don’t know yours, this is a great reason to sign up for Mint right now.  Mint gives you a free credit score and updates it every month.

It also gives you notifications on when any major changes have occurred. For example, if you opened up a new credit card or recently purchased a property using a mortgage.

Downsides to Mint

Nothing is perfect in this world, and Mint is certainly no exception. It has it’s drawbacks and certain parts of it can be frustrating. I dive into those below.

Categorizing Transactions

The most frustrating part of Mint (for me) is that it does not seem to have a great memory of what category I place certain vendors in. For example, I pay my student loans through a vendor called Firstmark Services. Mint recognizes this vendor as a “Marketing Cost.” This is totally wrong. Every single month when I make these payments, I need to go in and reallocate the costs to the “Student Loan” category.

Credit Score is Not Totally Accurate

Your credit score on Mint is not completely accurate. In my experience it has been a 30–40 points higher than my actual credit score. So do not be surprised when you go to a lender they do a hard pull and see that your credit score is 689 instead of 720.

Connections Frequently Lost

Often times, the connections to the various accounts I have get disconnected. I need to go in and reenter in my username and password to reestablish the connection.

I’m not sure if this is the fault of Mint’s, but the value of my car stays stagnant. I need to go in and constantly delete and reenter my car on the platform to get an accurate representation as to what it’s worth.

Related: 3 Technologies Changing the Way Landlords Manage Rental Properties

Couple of Months to Ramp

Depending on how many accounts you have, it likely will only take 30–45 minutes to fully setup your account. While you will understand your net worth position right away, you likely will not understand where you are spending your money until at least one month later.

When entering in credit card or bank account information, Mint does not account for historic transactions, so seeing where you’ve spent your money right away is difficult.

Conclusion

When it’s all said and done, the information that Mint provides far outweighs the downsides. Tracking your spending and your net worth is the first step you can take in your journey toward financial independence.

If you don’t know where you are in your journey towards financial independence and don’t know your spending habits, how are you going to know when you achieve your goal and what you need to do to get there? Mint helps with that. It’s the foundation that I use to understand where I stand financially.

Have you used Mint or another service to track your money?

What do you like and dislike? Share below!

About Author

Craig Curelop

After developing a huge love for real estate investing and personal finance, Craig decided to join the BiggerPockets team as a financial analyst. Over the past few years, he has looked at hundreds of financial models of startup companies. His experience will help BiggerPockets reach the next level as a startup company. Craig has a passion for helping others get out of their "comfort zones" to get what they want and achieve the "impossible." In his spare time, Craig enjoys traveling, hiking, exercising, and sports of all kinds.

4 Comments

  1. Patrick McMahon

    I have a love/hate relationship with Mint. You’d think the folks who make Quickbooks could write a program that works, but not so much.

    Not only does it fail to update Bluebook values for cars, it loses the Zestimate values for half my houses. Like you, I have to go in and manually update them.

    It would be great if it also had the ability to make changes to past data. I forgot to enter a house purchase in Mint, so my net worth “dropped” for a few months (cash out, but no house to offset) and the graph looks wonky.

    But I do love the Net Worth (all time) graph to get a feeling that my efforts are producing results!

    • Craig Curelop

      Patrick,

      Thanks for the contribution. I agree, the Bluebook value for cars updates only once a month and sometimes I have to delete and reenter it. The Zestimate values, I can only take with a grain of salt. Sometimes the value increases or decreases $30k within a week…

  2. J W.

    I tried Mint when it first came out and what I found was that I didn’t like it having password access to all of my banking and retirement funds. I am sure security has progressed over the years, but the companies being hacked around that time and all of our information being given away had me too nervous to feel comfortable to continue. I do track almost all of the things that Mint had me originally input, and I do it monthly, although I do not track the values of cars as I use those and don’t consider them as assets I can liquidate. If I sell one then I’ll just need to buy another. Since they also lose value over time, rather than gain it as rental homes do, I track the loans/debt I still owe on them instead so they are either not impacting or purely negative net worth.

    Tracking my net worth has certainly allowed me to see trends where I can either tighten or loosen spending habits and follow the successes (and downturns) which have been driven by my rental properties. Financial freedom has not been achieved yet, but it is a goal worth following up on monthly. Using Mint or other methods is certainly recommended.

  3. Craig Curelop

    Thanks for commenting, J!

    On the car front, I couldn’t agree more. It seems like everyone has their own unique way of calculating a net worth number that is comfortable for them. I believe the way we calculate are very similar.

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