Microsoft Money 2005

With the 2005 edition of Microsoft's best-selling personal finance software, phrases such as 'new and improved' and 'now simpler' abound. They always do, of course.

But the truth is that the company got the basics of Money right a long time ago, and if you want to hook new buyers (and entice existing users to upgrade) then you have to add something new each year. Whether or not you consider the changes a bonus, or a pointless fixing of something that wasn't broken, is largely down to personal taste.

At its heart, Money is a simple program. It's a spreadsheet (or a set of inter-related spreadsheets) wherein you create a series of accounts for your credits and debts. The software lets you view your overall wealth, where your money is going on a regular and long-term basis, and how you can make it work harder for you.

This dry stuff is enlivened by an impressive use of graphs, pie charts and projections (bringing the dull subject of lucre to life for the most innumerate of us).

Taking things a step further, the package integrates well with the MSN Money website, an excellent resource for financial news, best buys, and workshops to help you learn more about the green stuff.

Using Money can be split into a three-step process: getting your finances under control; educating yourself; and planning for the future.

The first stage is probably the most onerous, as you rake together the details of all your accounts, expenses, pensions and so on, and type in this information. If you did nothing more, the software would have paid its way already; most of us don't lose money on the big things, but through bad budgeting.

You may discover moribund building society accounts, or standing orders that you never got around to cancelling, this can be a valuable spring-clean for the finances.

And then life gets much easier. Money will tally your credits in one column, your debits in another. Possibly for the first time you'll get a picture of your overall financial health, and the reason for that monthly shortfall will become clear. Now you can start to budget, to trim waste and - should your problems be more basic - get professional help with credit and debt (it's all in here).

You may find that simply by budgeting you have a little left each month. These savings could be working harder for you, and Money has worksheets on money management, investing in shares, property, bonds and so on.

But the real benefit will be day-to-day money management. Never again should you get nasty shocks when you open bank statements. Bills will pop up as 'due' on your home page and you can budget to cover them, thus avoiding swingeing bank charges for bounced payments.

The essence here is to keep the information up to date - it's useless otherwise - and Money lets you download statements direct from your bank, automatically balancing your accounts. Now you can start tweaking, adjusting payments out of your account to coincide with pay days, and sloshing excess funds (we can dream) into an interest-bearing account, thus making your money grow.

The improved interface is attractive and simpler to use. Microsoft has also managed to declutter pages, and puts more control in the user's hands.

Tailoring a home page has long been one of the selling points - regular expenses over here, account summaries over there, a space for graphs created from the reports section here - but the program now gives you the power to tailor at an earlier stage. Go to the Budget Categories section and tick to add in the budget items you require. You can be very detailed and go for school expenses, motoring costs, ad nauseam.

Or - our preference - you can keep things to broad categories: it's pointless to obsess on the small stuff, while the average household budget, with its bank and savings accounts, mortgages and utility bills is complex enough.

Microsoft has simplified the start-up process and gone for a leaner interface. So, is it worth upgrading from Money 2004? No. But if you don't have a personal finance package and need help in this area, don't hesitate to invest.

Contact: Microsoft 0870 60 10 100
www.microsoft.com/uk

System requirements:

• Pentium 166 or above, PII 266 for XP
• 64MB for Windows XP; 32MB for 98SE/2000 SP3
• 130MB hard disk space, plus 200MB while installing updates
• 2x CD-Rom drive
• 256 colours
• 800 x 600 resolution graphics card
• Internet Explorer 6 SPI (included on CD)