Get your computer to look after the pennies

People who have considered using their computer to manage their finances can be forgiven a little cynicism this year. Intuit, the company that made and supported Taxcalc - the product that lets you tap in details of your tax return and then produces it all nicely filled in for you - dropped the software, and it was a couple of months before the new owner, ASP, stepped in. Likewise, Intuit pulled the plug on the UK version of Quicken last year.

While users may find their software works for quite some time, there is no guarantee that it'll be receptive next time their bank updates its security for online banking.

You can imagine a number of people, therefore, being careful about what they download on to their PCs for that very reason - a financial package that conks out and won't have anyone in tech support is not the most reliable of technologies to own.

Luckily this hasn't been the experience of everyone who has used technology to manage their finances. Glynn Simpson bought a copy of Microsoft Money (for which you'll get change from £20 in most places) about eight years ago when there was an offer on. 'At first it was a way of staying out of debt when I was newly married, and it's also been a way of paying off our mortgage early.' Neither of these things is impossible without a computer, but using a tool like this to present information has proven invaluable to a lot of customers.

The way in which the software works is that you enter all of your details - including all bank balances and credit card details - mortgage including interest rates, and optionally security details so the system can link straight into your online bank or credit card. It then offers a snapshot of exactly where you are now, and deluxe versions offer invoicing functions for the self-employed (although accountant after accountant will tell you that these don't prepare proper accounts for you, much to the freelancer's chagrin, at the end of a financial year).

You then enter everything you spend and earn and it tells you what you're spending your money on. In many cases this will highlight areas in which you can cut back, and you might be surprised at, for example, how much you're spending on eating out.

Money and other similar programmes also offer bits of advice. 'The bit that said "pay yourself first" was a good one,' says Simpson. He now finds that for half an hour entering data per week, he's on top of everything financial, and even runs a website (www.money.mvps.org) to help people using the same software.

There are alternatives to Microsoft, of course. Mamut Home is new software specifically aimed at people who want to monitor and reduce debt. If you're one of the 4 per cent or so who use an Apple Mac computer, then CheckBook (www.surprisesoftware.com, but do make sure you're getting the UK version) does much the same thing.

And you might not want to buy any software at all. Your computer, however, can still help, depending on with whom you hold your accounts. Most banks and credit card lenders by now offer some form of internet banking, but if you have a credit card or loan through Egg (www.egg.com) then it's an easy matter, as long as you have the account and security details to hand, to consolidate all of your finances and get a view of all of your savings and borrowings from the one screen.

The standard precautions on the internet must apply; if you don't trust a site you shouldn't enter your details, and if you get an e-mail - no matter how genuine it looks - that asks you to log into your account using your password, don't, it's a fake.