Professionals who provide the same services as Mint; i.e. personal expense tracking & analysis?

Question

Not long ago I went to a financial advisor/money manager for a discussion of all (I mean all) my finances and was needing some analytics in the short term to decide what smart actions to take for the long term.

We talked right past one another because he simply wanted to talk retirement and investments, but I wanted to talk down to the level of identifying money leaks through suboptimal expenditures, overpriced services, etc. and I asked him if he could use Mint to look at my finances on that level. He completely dismissed the idea that anyone needs services like Mint, at least from a professional perspective. I disagree, but we can argue that another time.

Right now I just want to know how I can find a human "money manager" who does more than just investments and that can look at things like my bank statements, card charges, etc. and provide some analytical insights at the expenditure tracking level for personal finance. I prefer the interaction element with another human and someone who is licensed and knows their stuff.

Does such a job description exist, and if so where can I look?

Answer 1

Money managers do not operate on such a micro level. At best, they offer a big picture plan: savings, retirement planning, tax guidance, investment options, etc. At worst, they're promoting expensive services (load funds, second rate annuities, house products) and often their own incompetence.

Given today's cost of living and the cost of professional advice, it will not be cost effective for you to hire someone to dig through your bank statements, card charges, budget, etc. looking for money leaks. You should be able to do that yourself.

Answer 2

The best term I can get to work with Google is "Cash flow and budget analysis" or some variation with "financial planner" or "personal" included. This includes a lot of results for business analysis though, so you will have to sift through a lot.

I was able to find a couple financial planners that offer this service. However, they seem to be fee-only. So they'll charge you $200 (random number I came up with) and then look at your budget. This might be worth it if they can save you $10 a month, but that's up to you. You will have to estimate how much you think they could help you save and then determine how much you're willing to pay for the service. If you want this done on a regular basis I doubt they would save you enough money to cover their fee.

The best course of action might be to contact Certified Financial Planners (CFP) in your area and ask them if they do "Cash flow and/or budget analysis".

Answer 3

Some financial planners offer the service of personal spending analysis: "Knowing where your money goes each month can help prioritize your spending and find places to save more. We work with you to develop a budgeting plan that works for your lifestyle."

Here is an apparently defunct service from ten years ago: "...essentially acting as your personal bookkeeper online..."

Answer 4

Some financial advisors certainly offer this service. Many professional services firms specifically offer Wealth Management which usually entails doing anything you want them to do related to helping you manage your wealth. Typically this is for particularly high-net worth individuals.

For most people, the cost-benefit ratio won't justify such an expense.

Answer 5

We are in a place where things have become very specialized. The financial planner you want is one who hasn't yet built his client list so large that he's unable to spend the time on you. Of course you want a fee-only planner.

When I'm tutoring a calculus student at $150/hr, and the parent asks if I have an extra hour for their 4th grader, they are telling me 2 things. They and their calc student don't have the time or patience to do it, and they have the money to pay me, when, in theory, there are high school kids who would be thrilled to make $25/hr.

In this case, what you are asking may be a bit different from their typical client, but for someone trying to build a client list, they might be willing to take you on.

Your request is certainly valid, people pick and choose what they DIY vs what they sub out.

Answer 6

To get around the lack of personal consultation for expenditure reduction, in the UK we're lucky to have guy called Martin Lewis, who founded Money Saving Expert which does the hard work of looking up the best deals on common expenses (other money-saving websites are available). I'm not sure which country you're currently based in, but maybe there's something similar.

Also, in addition to all the other excellent points about why this isn't something you can efficiently pay another human to do, it's worth considering how rapidly the returns from expenditure reduction can diminish.

The maximum possible benefit from reducing expenditure is 100% of your current expenses, if it turns out somehow you don't need to spend money at all. More likely is shaving a bit off your current expenses — maybe 5% if you're already doing well, maybe 50% if you're currently over-spending a great deal.

If you're currently spending £24,000 a year, and you manage to shave 25% of that, you have an extra £6,000 a year. Great! But you probably won't be able to reduce your expenses by a further 25% next year (unless you're happy to significantly change your lifestyle over time).

However, if you instead use your time, and maybe even some money, to increase your income (maybe by training up in your job, or switching careers, or getting a better return from savings and/or investments), you can continue doing that well beyond 50% or even 100% of your current income.

For example, if you have £1,000 in a savings account earning 0.1% interest, that's £10.04 over 10 years. Spend a few minutes moving it to an account that pays 0.5%, and that's now £51.14 over 10 years. Your interest income has suddenly gone up by 509%! You're not going to find an expense that you can reduce by 509%.

Answer 7

We talked right past one another because he simply wanted to talk retirement and investment...

Because that person was not a financial advisor. That person was a broker. Who has a single job: selling you "financial products" either sold by his company, or paid on a commission basis. They pretend to be "financial advisors" in the sense you want.

These "financial products" are made artificially and unnecessarily complex, so people feel overwhelmed and just trust the broker. Products like load funds, variable annuities, whole life, etc. The complexity is added to conceal internal fees and sales commissions, that dig into your potential profits. They are bad investments.

There's no free lunch

You selected the broker because he was free. But he wasn't free. The broker got paid when you selected bad products with high sales loads/commissions -- which means, the broker only advised those products. Their motivation is totally corrupt.

Mint.com has the same problem. I took a gander around the site, and their business model is to recommend products and services that give them kickbacks called "affiliate links". That will have the same corruptive effect as above, with affiliate kickbacks significantly coloring their advice.

A Fee-only Financial Advisor

The person you want is a financial advisor who charges a fee to all clients, and does not advise commission-based products at all.

This person will give you straight advice, because they don't have any conflicts of interest.

And they will be happy to do any work you ask them to, since you're paying them by-the-hour.

The downside, of course, is you are paying them by-the-hour.

Answer 8

Frame Challenge

identifying money leaks through suboptimal expenditures, overpriced services, etc.

This does NOT require professional service. Just go through your checking and credit card accounts, and transcribe each item into a spreadsheet, along with a category. Then start comparison shopping, and asking yourself hard questions about whether purchases are worth it.