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FEATURE
Quicken 2003 Premier vs. Money 2003 Deluxe
By Wayne A. Thorp, CFA
Each fall as automakers roll out their
latest offerings, so too do the heavyweights in the personal finance software arena. It has been three years
since our last head-to-head comparison of Quicken and Money, so we devote this article to looking at the latest
ture for Money 2003 is the bevy of free
offers that come with the program. They
include one year of free on-line bill payments from MSN, on-line tax preparation and filing from H&R Block, a credit
report and credit monitoring service
from Equifax, and a consultation with
Figure 1.
Money 2003 Deluxe Home Page
high-end offerings from Intuit and
Microsoft—Quicken 2003 Premier and
Money 2003 Deluxe, respectively.
We cover everything from the latest
features both programs offer and their
primary functionality to their companion Web sites. At the end of the article,
an overall winner is determined by a
check-box scoring system. Points of
functionality are graded with ease-ofuse in mind.
What’s New?
While both Money and Quicken offer an expanded array of features and
numerous improvements, Money underwent more “nip and tuck” changes,
whereas Quicken saw a major cosmetic
overhaul.
Perhaps the most attractive new fea20
an American Express financial planner.
For Quicken 2003, its designers completely redesigned the user interface,
which those familiar with the previous versions may find to be more of an
annoyance than an improvement.
However, with version 2003, Quicken
surpasses Money in interface design
and ease-of-navigation. Money’s display is cluttered, while Quicken’s is
much cleaner—to the point of almost
being bare. While it may take some time
to master the new setup, you should
find the redesign an improvement and
worth the cost of upgrading from an
earlier version of Quicken.
The upgrade that is garnering the
most press in Quicken 2003 Premier is
the new Quicken Brokerage Powered
by Siebert, along with several other investment-related add-ons, which we
will discuss in the next section.
Personal Finance Features
Personal finance software generally
helps users answer three financial
questions: What do I have, How am I
doing, and How can I do better? To
accomplish that, they help you examine your current financial position and
provide a framework for achieving
your financial goals. For many, the list
of personal tasks is long and varied.
These two programs can serve as mere
recordkeeping diaries that track what
you spend and what you earn, or they
can function as planning applications
that consider only gross savings and
focus on generalized long-term goals
and objectives.
The nucleus of a personal finance
program is its “checkbook register.”
Data entered here flows into budget
accounts, updates net worth values,
and helps estimate tax liabilities,
among other tasks. The majority of your
time will be spent using this register.
Therefore, it is important to select a
program with an intuitive, easy-to-use
interface, as well as one you are comfortable using. Both programs offer
clean, graphical replicas of standard
checks, as well as checkbook registers,
but Quicken 2003 edges out Money
2003 when it comes to the checkbook
register interface, which is slightly
easier to navigate in Quicken.
On-line banking and brokerage functions available with both programs give
users the ability to connect directly with
a number of financial institutions—including banks, brokerage firms, and
credit card companies—to retrieve
posted transactions, download statements, and pay bills electronically. Our
test of setting up and retrieving statements and transactions from banks
and credit card companies went off
without a hitch using Money. However, a conflict with Quicken’s autoCI
matic bill payment created some
minor problems in downloading
bank statements into the program. Retrieving transaction
data from an on-line discount
broker posed seemingly insurmountable problems for both
Quicken and Money and, as a
result, portfolio transactions had
to be entered manually.
Once you have your accounts
set up, you can retrieve pertinent
information via the Internet.
With Money, this is done via its
background banking feature,
which automatically downloads
financial account data and stock
prices whenever you go on-line.
There is no need to schedule
when Money goes on-line to access this information, which is
required with Quicken—a definite shortcoming. The only drawback to Money’s background
banking is that it requires you to
have a Microsoft .NET Passport
Account.
For electronic bill payment, Quicken
offers Quicken Bill Pay service with a
free 30-day trial, while Money provides
bill payment through MSN Bill Pay free
Figure 2.
Quicken 2003 Premier Home Page
for one year (with purchase of Money
2003). Money 2003 now contains a bill
outbox and a batch bill pay functionality that allow users to prepare and store
bills—even when off-line—and submit
Figure 3.
Investment Performance Report From Quicken
January/February 2003
multiple payments at the same time.
Also for paying bills, Money 2003 has
added a bill estimator, which automatically estimates upcoming bills based
upon previous payments.
Another key feature of any personal
finance application is its budgeting capabilities. Both products allow you to
assign budget categories, as you enter
transactions into the checkbook register. The programs come with a predefined set of categories, but also allow you to add you own additional
categories. Money and Quicken also
“remember” the category for a payee
from previous entries. In Quicken, you
can manually enter in the amounts you
pay each month or let the program create a budget based on your past spending patterns. One drawback to this
“auto budget” feature is that the budget Quicken creates may not accurately
reflect how you spend your money if
you have not categorized your transactions. Money’s autobudget feature
offers the same functionality, with the
same potential pitfalls. However, when
setting up your budget, Money’s budget planner tool is more intuitive and
offers greater ease-of-use than Quicken.
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Figure 4.
Creating a Recurring Payment in Money
Budgeting involves much data entry
(cash activities, credit card histories,
etc.) and a dedication to maintaining
organized groups of your data (income,
payments, expenses, taxes). The computer program cannot do all the work
for you, so it is up to the user to maintain accurate records and make it a
habit of updating records and accounts
on a timely basis. While this can be a
tedious and time-consuming process,
it is unavoidable if you wish to gain an
understanding of your spending and
saving habits. If you are willing to go
the extra mile, both programs do an
adequate job of maintaining budgets
and producing planning forecasts.
Reports are a key component of any
personal finance program and help to
pull your financial plan together in an
easy-to-understand, graphical format.
Along with being two of the most easyto-use financial programs on the market today, Quicken and Money are also
the most graphical and visually pleasing. Within both programs, reports are
comprehensive, easy to read, and coherent, and provide a useful breakdown of your financial information into
specific categories. Specific financial
reports include detailed budgets; in22
come, expense, cash flow, and net
worth reports; and income tax estimates. Each program offers approximately 40 reports.
Taxes
Since taxes impact your finances,
they also play an important part in the
budgeting process. Pending tax liabilities are often reviewed and personal
finance programs offer suggestions
and adjustments to help you reduce
your tax liability or perhaps to modify
your tax withholdings. Both Quicken
and Money link to tax preparation software programs, so that data entered
into these programs can be exported
into the tax program for analysis.
To aid investors in making tax-informed trading decisions, Quicken
2003 Premier offers tax-smart investing insights that point out possible
opportunities to improve your aftertax
returns. Specifically, Quicken 2003 Premier can help users offset capital gains
or losses, inform users when similar
but more tax-efficient mutual funds are
available, and alert users when taxable events occur—such as mutual
fund distributions.
Money 2003 offers a beefed-up capi-
tal gains estimator and tax estimator.
With the capital gains estimator, users
can create and save a variety of scenarios to determine the most tax-efficient approach to selling an investment.
The tax estimator provides a side-byside comparison of the previous year’s
tax return to the current year in order
to estimate upcoming taxes.
Quicken works seamlessly with its
longstanding tax stablemate at Intuit—
TurboTax for Windows and Mac—as
well as with the TurboTax Web site.
Over the years, Money has moved from
working exclusively with TurboTax to
Microsoft’s own tax preparation software—TaxSaver—to now offering free
tax preparation and filing with H&R
Block’s TaxCut software. With H&R
Block, a trusted name in tax preparation, and TurboTax, practically the
name in tax software, it becomes a wash
when comparing the programs’ tax
functions.
Additional Planning Tools
Besides creating budgets to gauge
your spending habits and preparing
and filing your taxes, financial planning entails other tasks for which both
programs can provide help.
In Money 2003 Deluxe, other planners you have at your disposal include
debt reduction, insurance, and lifetime,
while Quicken offers retirement , college , home purchase , debt reduction ,
and special purchase planners. While
both programs provide a number of
planning tools, only Money has taken
the extra step of integrating them all
into “whole-life” planning. This is
something that Quicken should
strongly consider.
Both programs also offer IRA planners, insurance planning aids, insurance and mortgage on-line shopping
directories, home and auto valuation
tools, and home inventory assistants.
Home inventory is simply a list of
your personal possessions—fine jewelry, rare pieces of art, collections, etc.
If your personal possessions are either
stolen or destroyed, an accurate inventory will help you when filing your
claim. This feature allows you to enter
specific tangible assets into predefined
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categories, with the option of entering
purchase price, date, depreciation, a
description of the item, and the insurance policy covering it. Both applications provide very similar home collection tracking, although Money has the
added feature of linking images to your
possessions. Furthermore, whereas
Money’s inventory tracker is integrated
with the program, Quicken home inventory is a separate module from the
actual Quicken software.
Portfolio Management Features
When looking at the personal finance
software marketplace, individual investors have a limited selection from
which to choose. However, this is not
the case when it comes to portfolio
management programs running on
Windows—several are available. In the
broader portfolio management market,
programs are divided into two groups:
general purpose applications and advanced programs. This clear differentiation gives investors more flexibility
and more choices. The high-end programs are robust portfolio managers
that concentrate on portfolio evaluation and fine-tuned portfolio and asset
allocation analysis—such as the
Captool software. For more information on portfolio management software,
refer to the November/December 2001
Computerized Investing comparison article, which is available at the AAII
Web site.
The general-purpose programs are
viewed as recordkeepers or actual portfolio trackers, instead of full-blown
portfolio managers. They adequately
track a portfolio and may offer some
portfolio analysis measures and return
calculations. However, they primarily
serve as advanced spreadsheets for recording buys and sells of securities.
Quicken and Money both fit into the
category of a general-purpose portfolio manager.
While these programs do not yet have
the tools and features to take on the
top-tier portfolio management applications, they have, over the years,
moved beyond the scope of traditional
personal finance tasks—budgeting, bill
payment, and account tracking—to
January/February 2003
begin focusing on investing as well.
This year’s releases of both programs
take coverage of investments to the next
level.
Key to portfolio management programs are the types of securities and
transactions the program can handle.
Both Quicken and Money track a standard set of securities: cash, stocks, mutual funds, and bonds. Money 2003
Deluxe has added an option wizard
tool for creating and tracking equity
and index options (not employee stock
option plans). The program also has
added an exercise wizard that guides
you through the process of exercising
existing options. Furthermore, the
Money register can now handle options-related activities. None of these
features are yet available with Quicken.
For security identification and categorization, both programs offer similar
features, including the ability to specify
asset class type.
Recordkeeping is a relatively simple
task that, in theory, can be done with
paper and pencil or a simple spreadsheet. However, errors that can arise
with such methods can distort your
financial picture to the point of causing you to make unsound financial
decisions. A portfolio management pro-
gram rises above the potential pitfalls
and presents professional reports
based upon the data you enter.
Buying and selling a security, receiving cash or stock dividends, and receiving interest income are the primary
transactions you will need to record.
Moving beyond these standard transactions, both Money and Quicken offer
additional recording options such as
margin purchases, short sales, and the
reinvestment of dividends. Both programs also allow for three different security lot assignment methods—average cost, FIFO (first in, first out), and
specific lot. Transactions and security
lot cost basis methods are handled in
relatively the same manner with both
programs. The only real difference between the two lies in entering investment-related transactions. With
Quicken, all transactions are handled
within the same checkbook register,
while Money has separate registers for
“investment” transactions—buys,
sells, etc.—and for “cash” transactions—dividends, interest income,
withholding taxes, etc. Jumping between registers depending on the transaction is an unneeded step.
While both programs have made
great strides over the years in the area
Figure 5.
Investment Performance Report From Money
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Figure 6.
Portfolio Holdings Gain/Loss Report in Quicken
of investment tracking and analysis,
Microsoft 2003 Deluxe gets a slight nod
over Quicken 2003 Premier for its handling of investments. The clinching factor is the program’s tight integration
with the CNBC on MSN Money Web
site, which is one of the best financial
Web sites available.
Portfolio Reports
Data entry takes up a significant
amount of your time when it comes to
setting up a program to monitor your
finances and, especially, to track an
investment portfolio. A complete purchase and dividend history must be
entered for each security to produce
accurate return calculations. This process is typically more of a burden for
long-standing mutual fund positions
with frequent reinvestment of dividends. The payoff for this effort is the
automatic creation of a range of useful
reports with only a couple of mouse
clicks. Reports can be as simple as a
basic portfolio holdings report that
breaks down the composition of your
holdings, or as sophisticated as an asset class performance report gauging
the strength of, for example, your foreign stock funds.
The basic reports found in most port24
folio management software packages
include current holdings, holdings by
lot, cash portfolio status, and popular
tax schedules—e.g., Schedule B for
computing interest and dividends received from a portfolio and Schedule D
for computing long- and short-term
capital gains. All of these basic reports
are available in both Quicken and
Money. For the most part, the programs
are equally matched when it comes to
basic reports and both allow for reports to be customized (adjust column
headings, choose data to be presented,
etc.), which is a nice plus. One unique
feature offered by Money is the ability
to export chart and graph data to
Microsoft Excel spreadsheets.
Performance reports summarize how
well your investment holdings have
fared over a given time period. They
can analyze broad categories or concentrate on the smaller, fine points of
your portfolio. A fundamental part of
the portfolio management process is to
determine and analyze performance—
either using return calculations or performance reports.
Portfolio return calculations present
the clearest view of how well your investment holdings have performed.
Two different types of return calcula-
tions can typically be found in a portfolio management program—the
value-weighted (also referred to as dollar-weighted) internal rate of return
(IRR) and the time-weighted rate of return. The value-weighted IRR is best
for gauging the true performance of
your portfolio’s return. The IRR is both
a value- and time-weighted calculation
in that it considers both the timing of
investment inflows and outflows, the
amounts of these flows, and the combined impact upon the overall rate of
return. A time-weighted rate of return
calculation ignores the impact of
money flowing into or out of an investment account and paints a picture of
only the security selection decisions. It
is typically used to measure the performance of money managers.
The first key type of performance report is actually three different reports
revealing essentially the same thing,
but for three different portfolio entities.
Security, industry, and asset class performance reports gauge the strength of
each individual segment, but will also
provide portfolio allocation analysis
at the same time. Industry performance
reports can analyze just the securities
from a certain industry, say auto manufacturers, while asset class performance reports analyze a group such
as foreign equity funds. The 2003 versions of Quicken and Money provide
only security and asset class performance reporting.
When it comes to reports and reporting capabilities, optimally three flexibility functions must be present: the
ability to track multiple portfolios, the
option of testing portfolios over a
known holding period as well as a
user-defined time period, and the ability to adjust returns for taxes. All three
functions are available with both
Quicken and Money.
Most, if not all investors track more
than one portfolio—perhaps one for
themselves and one for their spouse, or
taxable versus retirement portfolios, or
separate portfolios for each child. Programs with the capability to house
multiple portfolios can easily address
the diversified aspects of all your holdings for all your portfolios, rather than
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those of just one portfolio.
A portfolio return for the current holding period examines the gain or loss
from the time the security is purchased.
Analyzing a portfolio over specific periods—between-period returns—allows you to monitor security performance during a known market environment, such as a bull or bear market.
To designate time frames, a program
must be able to store snapshots of your
holdings and values at specific points
in time, not just the current positions
and prices.
When a program provides tax-adjusted returns, this simply means that
it generates pretax and aftertax figures.
By automatically calculating the tax
liabilities of your transactions, these
programs can also report their impact
on the rate of return of the securities
and portfolios.
The most noteworthy enhancement
to Quicken 2003—beyond revamping
the user interface—is the partnering of
Intuit with discount broker Muriel
Siebert & Co. to form Quicken Brokerage Powered by Siebert. Quicken brokerage, which is also a stand-alone
product, provides discount brokerage
services with a $24.95 commission for
on-line equity market or limit orders,
access to research and analytical tools,
and tax-informed investing insight.
Reflecting the shift in the focus of these
programs in recent years, Quicken
brokerage’s goal is to help users “make
smarter, tax-informed investing decisions.” To this end, users of Quicken
brokerage receive information about
the potential implications of a trade
before it is made. The brokerage can
also upload your tax profile from
Quicken 2003 to track ongoing capital
gains and losses. Lastly, you can export Quicken brokerage 1099 information directly into Intuit’s TurboTax program for easier tax preparation, including cost basis information for your
Schedule D.
In the continuous game of oneupmanship between these two rivals,
it will be interesting to see if Microsoft
attempts to follow Intuit’s lead and
partner with a broker as well.
To see how these two programs
January/February 2003
Figure 7.
Web Interface Within Money Software
match up as portfolio managers, check
Table 1 at the end of the article.
Companion Web Sites
Although both Quicken and Money
are software-based applications, they
also have a strong presence on the
Internet in the form of their respective
flagship Web sites: Quicken.com
(www.quicken.com) and CNBC on
MSN Money (investor.msn.com). Both
sites are comprehensive one-stop investment centers on the Web, offering
analysis tools, research capabilities,
company reports, current and historical price and financial data, market
news archives, advice, and educational
materials. Furthermore, they are free to
registered users.
Money 2003’s many investing-related enhancements revolve around the
program’s ever-tighter integration with
the CNBC on MSN Money Web site.
This includes instant access to the MSN
Money Online Investing Research Center through Money’s integrated Web
browser. (In Quicken, the Web browser
opens in a separate window, creating
unnecessary clutter.) From the research
center, users have access to one of the
best Web-based portfolio managers that
now allows for creation of an unlim-
ited number of customized portfolio
views. The MSN Money Web site also
offers StockScouter stock ratings, allowing users to evaluate a stock’s potential based upon both fundamental and
technical factors.
Just like Money 2003, Quicken 2003
offers an array of investment analysis
tools and research through the
Quicken Brokerage Web site
(www.quickenbrokerage.com). Among
them is the One-Click ScoreCard, which
applies one of four stock selection approaches to help users evaluate stocks.
Also new to Quicken 2003 Premier are
intelligent alerts that inform you of investment-related events that impact
your portfolio—such as a stock beating analyst earnings estimates. Users
of Quicken can also enter transactions
into the Quicken Web site and then
download them into the Quicken software at another time.
Sampling the Programs
If you are looking for a free, full-featured trial from either one of these companies, you will be sorely disappointed.
Instead of offering full-version trials
of their software, Microsoft and Intuit
provide Web-based demos of each pro25
Table 1.
Rating the Programs
Quicken 2003 Premier
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
Money 2003 Deluxe
Personal Finance Features
Checkbook Register
On-Line Banking
On-Line Bill Payment
Budgeting
Taxes
Financial Reports
Additional Tools
Portfolio Management Features
Securities Handled
Security Identification
Transactions Handled
Security Lot Assignments
Basic Holdings Reports
Performance Reports
Return Calculations
Brokerage Capabilities
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
Technical Support
On-Line FAQs, Knowledge Base
Free Phone Support
✔
✔
Companion Web Site
Partnering Investment Web Site
Guided Tour/Web Site Help
Software Demo/Free-Trial Download
✔
✔
✔
Total Points
12.5
16.5
Scoring System: 1 point per personal finance feature; 1 point per portfolio management
feature; 1 point per technical support feature; 0.5 point per Web site feature.
gram where potential users can go
through a virtual demonstration of the
programs and see their features and
functionality. The “tour” of Quicken
2003 Premier is available at:
www.intuit.com/quicken2003/
demos/premier/quicktour.html.
Money 2003 Deluxe is available in a
free 60-day trial version, downloadable
from the Microsoft Web site
(www.microsoft.com/money/info/
trial/). However, it lacks the audio and
multimedia features found in the full
program and, perhaps more importantly, the “premium” services avail26
able with Money 2003 Deluxe—on-line
banking, on-line bill payment, etc.
While being able to see the key features of each application is useful, nothing beats being able to sit down with
the software, risk-free, and take it for a
test drive.
So What Does All This Mean?
From the discussion presented here,
it may have become clear that Money
and Quicken are perhaps evenly
matched in their latest incarnations.
When the choice is difficult between
two similar programs, as is the case
here, users often end up picking the
more familiar one. Most will go with
the firm with the bigger name, but in
this case, both programs have established themselves at the forefront of
the personal finance software field.
Emotional ties often factor into the
equation as well. Just as some people
are Chevy or Ford owners, so too are
the diehard Mac and Windows fans.
At least as far as platform goes, the
choice is clear-cut, since only Quicken
offers a Mac-friendly version in the
form of Quicken 2003 for Macintosh.
However, it is not nearly as full-bodied
as its Windows-compatible cousins.
No matter what your rationale for
purchasing any software program or
service to assist you with selecting and
managing your investments, make sure
it is the right one for you and your
investment needs and that it closely
matches your computer skill level. With
this comparison, we have tried to provide an objective review of these two
products, but any review is bound to
have some level of subjectivity.
And The Winner Is…
Table 1 provides a checklist of our
head-to-head comparison of Quicken
2003 Premier and Money 2003 Deluxe,
with Money prevailing over Quicken.
Each check in the personal finance,
portfolio management, and technical
support sections rate one point. Onehalf point was awarded for each
checkmark in the companion Web site
section. A checkmark is awarded if the
program excels in providing an easyto-use and functional feature.
As mentioned, these two programs
are very evenly matched, more so than
the final point totals indicate. Money
proved to be the better product on the
whole, but Quicken still remains a
strong contender. In the end, however,
neither Money nor Quicken present a
compelling enough reason for existing
users of earlier versions to upgrade to
2003, or to switch programs.
Wayne A. Thorp, CFA, is associate editor of Computerized Investing and
AAII’s financial analyst.
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