The budgeting app that doesn't want your money — or your data

Every so often someone comes into the shop and mentions, almost in passing, that they would like to get a better handle on where the money goes. It is rarely the reason they came in. It comes up while we are waiting on a backup to finish.

The story usually goes the same way. They downloaded a budgeting app. They connected their bank accounts. They used it faithfully for three weeks. Then the free trial ended, and the app wanted $100 a year, or they read the fine print and realized the company was making money by studying their spending habits. So they quit, and the shoebox of receipts came back out.

There is a third option worth knowing about. It is called Actual Budget. It is free, it is open source, and it is quietly one of the better pieces of software I have run across in a while.

What “open source” actually means

Most software is a sealed box. You are trusted to install it, and you are asked to trust that it behaves. Open source software is the opposite: the instructions it was built from are published where anyone can read them. Thousands of people can and do look. That does not make it perfect, but it makes it very hard to hide something unpleasant inside.

Actual Budget started life as a paid product built by a developer named James Long. In 2022 he released it to the public, and a community of volunteers has been improving it ever since. There is no company behind it that needs to grow, no investors to satisfy, and therefore no pressure to start charging you or start selling something about you.

It works the way your grandmother did

Actual is built on envelope budgeting, which is not a new idea at all. It is the cash-in-envelopes method: one envelope for groceries, one for the power bill, one for the church, one for Christmas. When the grocery envelope is empty, you are done buying groceries, or you deliberately take money out of a different envelope and accept what that means.

The software does the arithmetic and the record-keeping, but the discipline is the same, and so is the honesty of it. You can only budget money you actually have. There are no projected numbers and no wishful thinking. It is remarkable how quickly that clears things up.

Your information stays on your machine

This is the part I like most. Your budget is a file that lives on your own computer — the same as a photo or a Word document. It is not a copy sitting on a company's servers waiting to be analyzed, breached, or sold along with the company when it is bought by somebody else. There is nothing to sign up for and no account to create. You open the program and start.

If you want your budget on your phone as well as your computer, you can sync between them, and if you do, everything can be scrambled before it leaves your device so that even the machine passing it along cannot read it.

The honest drawbacks

I would not be doing my job if I only told you the good half.

On a single computer, Actual is free and easy. Download it, open it, done. But getting it onto your phone as well, or having it automatically pull transactions in from your bank, requires setting up what is called a sync server. There are hosting services that will run one for you for $2 or $3 a month, and the automatic bank connection in the United States runs about another $1.50 a month through a service called SimpleFIN. Still cheap. Not quite as simple as it sounds on paper, and if that sentence made your eyes glaze over, that is a fair reaction.

There is also no phone number to call. Help comes from documentation and a community of users who are generous with their time but are not employees and do not owe you a response by Tuesday.

And Actual will not do your thinking for you. It is deliberately hands-on. That is the whole point of it, but it does mean it is a poor fit for anyone hoping an app will fix their finances while they look away.

If you want to try it

Go to Actual Budget. There is a demo you can click through right in your web browser without downloading anything or giving up an email address, and there are free downloads for Windows, Mac, and Linux. If you are coming from another budgeting program, it can usually bring your history along with you.

Spend 20 minutes with the demo. If the envelope idea clicks, you will know quickly, and it will not have cost you anything to find out.

That, more than the price, is what I appreciate about software like this. It asks you to try it rather than to subscribe to it. There is not enough of that going around.

Deryck Burnett is the founder of Megabite, a technology, creative, and multimedia company on Amelia Island. He can be reached at 904-430-0350 or megabite.co.