Budgeting Software

What is budgeting software?

Budgeting software helps accountants plan, track, and optimize a business’s financial resources. The tool assists them in creating detailed budgets for various departments and projects, allowing them to allocate resources effectively. It also helps set financial goals, track revenue and expenditure, and monitor the business's financial performance.

Budgeting tools can also assist in financial forecasting. Some tools can predict future financial performance based on historical data, current financial information, and assumptions, such as sales growth rates, cost projections, and inflation rates. Such forecasts help accountants make informed decisions about resource allocation, investment strategies, and financial planning.

What are the core features of budgeting software?

• “What if” scenario:  Allows users to create hypothetical financial scenarios to see their planned budget's potential impact on their business. They can change variables such as revenue, expenses, or market conditions and instantly see the potential outcomes without affecting actual data. It helps in risk assessment and strategic planning to avoid future uncertainties.

• Forecasting: Predicts future financial performance by analyzing historical data and user-input assumptions. It generates projections, including income statements, balance sheets, and cash flow statements for upcoming periods, helping businesses anticipate financial trends.

• Cash management: Helps users track incoming and outgoing funds, forecast future cash positions, and set thresholds for alerting when cash levels are too low. This feature aids in avoiding liquidity issues, optimizing investments, and ensuring that the business has the necessary funds to meet its financial obligations.

What are the benefits of using budgeting software?

• Improves financial control: Budgeting software automates data entry and categorizes transactions, reducing human error. Users can set budget limits, and the software alerts them when spending approaches or exceeds limits. Real-time tracking and reporting offer the current view of financial status, enabling timely adjustments. With access to historical data and forecasting capabilities, users can make informed decisions and set achievable financial goals. Such precision and visibility empower individuals and businesses to maintain a tighter grip on their finances.

• Provides real-time financial updates: Budgeting software syncs bank accounts, credit cards, and other financial accounts and imports all the transactional data. It instantly reflects all the transactions on a dashboard, giving users access to their income and expenses anytime. This real-time information assists in better financial planning by helping businesses identify potential issues, make timely adjustments, and ensure optimal allocation of their financial resources.

• Assists in goal setting: Budgeting tool helps businesses in goal setting by defining and tracking specific financial objectives within the tool. Users can create budgets for various departments or projects and allocate resources accordingly. The software provides a structured framework for setting revenue, cost, and profit targets, making it easier to align financial goals with overall business strategies. Additionally, users can monitor progress in real-time, track key performance indicators, and analyze variances between actual and planned outcomes.

What are the potential issues with budgeting software?

• False projections: Business budgeting software can generate inaccurate forecasts due to inaccurate historical data, overly positive or negative user assumptions, or external factors not considered in the software. False projections can lead to misguided decision-making, financial instability, and delayed goals. To address this issue, users must ensure the input data’s accuracy, validate assumptions, and understand that projections are estimates subject to external influences. 

• Complex user interface: If a budgeting solution has a cluttered or unintuitive design, users may need help navigating the interface. Such complexity may hinder their ability to navigate the software efficiently, leading to increased frustration, longer learning curves, and amplifying data entry and budget management mistakes. To mitigate this issue, software developers should prioritize budgeting tools with user-friendly and easy-to-navigate interfaces.

• Data security challenges: Lack of data security features in budgeting tools can lead to data breaches, hacking, or unauthorized access. Users should carefully select software with strong encryption and authentication protocols and regularly update passwords to minimize security risks and protect their financial information from unauthorized access.

How much does budgeting software cost?

Most budgeting solutions on the market are priced on a “per month” basis, and their entry-level pricing plan ranges from $15 to $70* per month. An enterprise product that’s priced higher may include additional budgeting features, such as purchase order management, activity dashboard, and billing and invoicing.

*The pricing included is for the entry-level/lowest-priced offerings found on vendor websites as of October 27, 2023.

What is budgeting software used for?

Budgeting software is mainly used to track a business’s financial resources. However, the software can have multiple use cases based on the data fed into the system and its leveraged features. Some of them include:

• Budget management: Business budgeting tools enable organizations to create comprehensive budgets for various departments or projects and allocate resources efficiently. These tools offer advanced features such as forecasting, scenario analysis, and variance reporting, allowing businesses to adapt to changing conditions, control costs, and make informed financial decisions.

• Financial reporting: Budgeting systems can generate financial reports, such as income statements and balance sheets, by pulling data from various sources, such as integrated systems and spreadsheets. This ensures accuracy and consistency in reporting. Additionally, they often offer customizable reporting templates and visualization features, making it easier for businesses to present financial information to stakeholders in a clear and understandable format.

• Expense tracking: Budgeting platforms allow users to input and classify expenses in real time, offering a clear view of business transactions. These tools often allow for automatic import of financial transactions from various sources, reducing manual data entry. Additionally, they generate expense reports and offer alerts or notifications when spending approaches budget limits, facilitating better cost control.

Which software tools integrate with budgeting?

Several software solutions integrate with budgeting solutions, allowing them to extract data from multiple data sources, systems, and databases to generate comprehensive reports. We looked across thousands of reviews from users of budgeting software to identify the products users frequently mention integrated with their budgeting tools:

• HubSpot CRM is a customer relationship management (CRM) software that helps businesses manage their interactions and relationships with customers. This integration can align financial data with CRM data to track budget-related information in the context of customer interactions.

• Microsoft Excel is a spreadsheet application that enables users to create, organize, and analyze data, perform calculations, and generate charts and graphs for various purposes. Accountants can leverage Excel’s data analysis and reporting capabilities to analyze financial data and generate reports.

• Microsoft Power BI is a data analytics tool that allows users to visualize and share insights from their data. This integration empowers accountants to create interactive financial dashboards and gain deeper insights into budget performance.

• NetSuite is enterprise resource planning (ERP) software that provides a suite of business applications for financial management, e-commerce, customer relationship management, and more. This integration aligns financial planning and management with the broader spectrum of business operations, enabling smoother data exchange between budgeting and ERP systems.

• Stripe is an online payment processing platform that allows businesses to accept payments over the internet. This integration helps them gain real-time insights into revenue streams, track transaction fees, and align financial planning with sales data.

We identified the integrations mentioned most often in verified reviews of budgeting software published on GetApp within the past two years.

Key considerations when purchasing budgeting software

• Check multi-currency support. Checking for multi-currency support in budgeting software is crucial for businesses that engage in international transactions or operate in diverse markets. It ensures the software can handle different currencies accurately, simplifying financial management, exchange rate calculations, and financial reporting. 

• Test the user interface. An intuitive, user-friendly interface ensures efficient navigation, reduces the learning curve, and minimizes errors in data entry and budget management. A well-designed interface enhances user productivity and overall satisfaction, making it crucial for effective financial management within a business.

• Assess available reporting options. Evaluating reporting options in budgeting software is vital for business needs as it determines the software's ability to generate clear and comprehensive financial reports. A robust reporting feature ensures businesses can communicate financial data effectively to stakeholders, aiding decision-making and compliance.

Sources

Products evaluated for the pricing calculation were taken from GetApp’s budgeting software directory. The pricing ranges exclude freemium versions of the products. The features highlighted were identified based on their relevance and the percentage of products in GetApp’s directory that offer them.  

Disclaimer

This budgeting software buyers guide was authored by GetApp's content team. We develop our guides using the author’s expertise, insights from 2M+ unique user reviews, and our proprietary data science algorithms to identify trends in user sentiment, preferences, and priorities. Some text was generated with assistance from artificial intelligence tools.