In my job, I wrestle with a lot of numbers. Sure, personal finance is ultimately about what you can do with your money, about your goals and hopes and dreams. But from day to day, it’s all about dollars—where to put them and how to get more of them.
To deal with the nuts-and-bolts side of money, I turn to a few tools again and again. You’ve already heard of my favorite; it’s a four-letter word starting with M. Here’s what I use when Mint can’t answer my question.
Be forewarned that this is geekery of the highest order. But if you’re involved in managing your money, I suspect one or more of these tools will make your life easier.
1. CFFP Annual Limits (free)
Quick: what’s the income limit for a married-filing-jointly contribution to a Roth IRA? What’s the top of the 28 percent tax bracket? How about the Social Security full retirement age for someone born in 1958?
The Annual Limits sheet is put out annually by the College for Financial Planning. It’s a two-page PDF that answers about a million different questions about minimums and maximums, Medicare and Social Security, taxes and credits, and is totally free.
Speaking of credit: certified financial planner Dave O’Brien told me about this one. Thanks, Dave.
2. Dinkytown.net calculators (free)
Say you’re buying a car and the dealer offers you a choice: get a low interest rate on the car loan, or a higher interest rate with a cash-back rebate. Which is the better deal?
The Auto Rebate vs. Low Interest Financing calculator at Dinkytown.net can answer the question. Their other 350 calculators can answer your other questions about mortgages, loans, investing, retirement, and insurance. Yes, they really have over 350 calculators, and they’re all free.
One drawback to Dinkytown: because the calculators are written in Java, they don’t work on most smartphones.
3. Morningstar.com and ETFreplay.com (free)
A friend recommends a mutual fund. Keeping in mind the boilerplate warning about not predicting future results, you want to see its past performance.
So you punch the ticker into Google Finance or Yahoo Finance and get a nice chart. Unfortunately, it’s a price chart. It only shows you changes in the capital value of the fund; it doesn’t include reinvestment of interest or dividends. Since most people do reinvest dividends—especially in retirement accounts—this makes for a pretty picture that doesn’t tell you much. (Kind of like the US Weekly of investing.)
Instead, head over to Morningstar.com (for mutual funds) or ETFreplay.com (for ETFs). Here you can see the total return of the fund, including reinvested dividends. The difference can be huge, especially for bond funds and dividend stock funds.
4. Economy app ($2 to $5)
Available for iPhone, iPad, and Windows, Economy lets you stay on top of economic indicators. We’re talking unemployment, GDP, inflation, and so on, the stuff that makes for gloomy headlines.
Even if you don’t use these indicators to drive your investment decisions (I don’t), it’s a handy reference for anyone who wants to stay informed. You can create custom graphs of your favorite indicators and even shade the graphs to indicate different presidential administrations. You’ll be able to say, “I knew that guy was bad for the economy,” with even more self-assurance than usual.
5. Soulver ($4 to $25)
Financial planners use two hardcore number-crunching tools above all others. One is Microsoft Excel, the ubiquitous spreadsheet application. The other is the HP 12C calculator, a handheld financial calculator that requires extensive training.
I have both of the power tools, but I do over 90 percent of my calculating using an app called Soulver. Available for the Mac, iPhone, and iPad, Soulver is a hybrid between a simple desktop calculator and a spreadsheet. When I start up Excel, it feels like I’m about to take on a major project. Soulver is quick and dirty and much more powerful than it looks.
Most calculators assume that once you’ve finished inputting an equation, you’re done with it. It’s easy to calculate compound interest with a regular calculator, but try going back and changing the interest rate without reentering the whole problem.
With Soulver, you can always go back and edit anything, and you can plug the result of one expression into the next and have it update dynamically.
Basically, Soulver is like the Google of calculators. Before Google, it was a pain to look up simple facts, so we usually didn’t bother. Now the answer is two seconds away. Soulver does the same thing for math problems: why speculate about the answer when you can calculate it in a few seconds and it’s even kind of fun?