Saturday, January 30, 2010

Personal Finances on Linux with KMyMoney

Linux has several excellent personal finance applications. Today we're going to look at KMyMoney. Though specifically developed with the KDE desktop in mind, KMyMoney works with any Linux desktop.

How useful KMyMoney will be to you and how easy it will be to use depends on two factors: One, whether or not your bank uses a supported online banking protocol, like OFX or HBCI, which applies when using any type of money management program. Two, if you can get a set of plugins working, which includes check printing support.

KMyMoney Summary view
KMyMoney Summary view

If your bank and KMyMoney are compatible, your account history and balances are automatically updated in KMyMoney.

If they are incompatible for any reason, you'll be stuck with having to manually update your accounts. That isn't great if you deal with a great amount of money or transactions.

If you can successfully install a set of plugins, you can bring check printing support into KMyMoney, among a few other features.

This can also be a deciding factor for if KMyMoney is a feasible option for you. With check printing support and a stack of compatible blank check paper, you can have KMyMoney print and log all your checks.

If you don't go that route, you must manually input the check details to have a balanced account.

Getting started
The first time you open KMyMoney, the New File Setup Wizard should appear. Follow this wizard to setup the basic settings.

You'll input your personal data (name, address, etc), set the currency type, and enter checking account details. You'll also choose the account type(s) you want to track with KMyMoney, so it can create the proper database and structure.

Near the end of the wizard, you can optionally hit the Configure Preferences Now button. In the Preferences, you might consider enabling Autosave so you're better protected if the application or your computer crashes in the future.

You should also consider enabling GPG encryption, so your data and sensitive information is secure if your computer is stolen or hacked into.

Finally, at the end, you'll be prompted to define a filename and location. Make sure you store the KMyMoney data file in a safe location.

You might even edit the file or folder permissions. You could remove all permissions for Others and Groups, just giving yourself access to the data file.

Adding more plugins
As discussed, you can install plugins for additional features, such as check printing. If desired, download and extract the compressed folder to an accessible location, such as the desktop, and install using the following steps:

Create a new directory somewhere and then move to that directory:

mkdir kmymoney-plugins-build
cd kmymoney-plugins-build
Then install the plugins with the following lines of commands:

cmake /home/YOUR_USERNAME/Desktop/kmymoney-plugins-x.x.x/cmake
make install

Configure savings account
Most likely you have a savings account--though, like many others, it might be running low. So first you should probably create an account in KMyMoney for it. Here's how:

  1. Click Account > New Account.
  2. On the wizard, select the Institution or create a new one if it isn't listed by clicking the button.
  3. Then type in the Account Number and, if one exists, a IBAN number.
  4. Then click Next. Type in an Account Name, such as Savings, configure the other settings, and click Next.
  5. Select the main account you want to place this new one in, if multiple parent accounts exist, and click Next. Verify the details and click Next.
Configure additional accounts
To get the most out of the KMyMoney application, you should input details for all your accounts.

This includes credit cards and loans, investments, and any other assets or liabilities. Follow similar steps as you did when configuring your savings account:

Click Account > New Account. For each different banking organization you must create an Institution entry.

Enabling online banking
Keep in mind, most banks require a separate username and password to access your accounts through an application. So before proceeding, check with your bank to see if they support OFX connections.

They likely won't know what KMyMoney is particularly, so you might mention a more popular application, like Microsoft Money or Quicken.

Click the Accounts icon, right-click an Account, and select Map to Online Account. If more than one plugin exists, it will prompt you to choose one.

To use the integrated feature, select KMyMoney OFX. Then use the wizard to search for the bank and input your login credentials.

If you can't find your bank, you can hit the Manual tab and input the details you get from your bank.

Once you have it configured, you can go to the Accounts or Ledger page, select the Account and select Update Account to download updates from your bank.

Adding and modifying payees and payers
When you input transactions, KMyMoney automatically creates payee entries when you pay money out or payer entries when you receive money.

That way you can see and analyze your expenses and income per the companies/persons you're giving your money to or receiving your money from.

If you haven't had a transaction come through for a particular payee or payer yet, you might want to create payee entries manually. Additionally, you might want to do this if setting up payee/payer matching.

To see the list of payees/payers, click the Payee icon on the left pane of the application. To add an entry, right-click on any existing entry and select New Payee.

Remember, you must already have at least one entry before you can manually create one. To create the first entry, you can enter a transaction.

If you have an account linked with your bank or you manually import transactions, and the payee/payer name or description isn't exactly the same for each of its own transactions, consider using payee/payer matching.

This could group all the transactions from the same company but at different locations, such as fast food locations. For instance, both "Fast Food Corp Store #123" and "Fast Food Corp Store #987" could be automatically placed into the "Fast Food Corp" payee.

Inputting transactions
If transactions aren't being automatically logged into KMyMoney, you'll want to manually input them.

Simply click the Ledger icon on the left pane and click the New button on the bottom of the window.

Then choose the appropriate tab: Deposit, Transfer, or Withdraw. Then fill in all the details and click the Enter button.

Looking into the other features
We reviewed the basic tasks in getting KMyMoney up and running. Don't forget about the remaining features.

If you expect a transaction or have reoccurring transactions, consider setting up scheduled transactions.

This can be useful to input all your fixed expenses and income. If you have stocks or retirement money, you might want to look into the investment features.

Don't over-look the reports and budgeting features; these can be a big help.

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