It is one thing to have a budget down on paper. It is an entirely different process to use your budget when you are out and about. Once you have made a few purchases, you may not realize just how hard those purchases have hit your budget until you plug in the numbers at home. By then, you may have already ruined your budget for the month.
We live in an age where virtually everyone is attached to his or her smartphone. While some may argue that this is a bad thing, it can be a very good thing for your budget. You may not realize it, but your smartphone offers amazing ways to stay on top of your spending and save money when you need it most—when you are actually out and making purchases.
Several apps are available to help you save money and keep your budget in check. If you are like me and need a reminder to stay on track, these apps can be lifesavers.
Pocket Guard: A Great Way to Track Spending
If you want to have instant access to your balance information at all times, Pocket Guard might be the answer. Pocket Guard syncs directly with your bank accounts and gives you real-time updates about your spending. You can even hook it up to multiple accounts. It also helps you budget by automatically calculating your regular expenses and income—no more spending time entering numbers into the computer!No more spending time entering numbers into the computer! Click To Tweet
It lets you categorize spending and automatically classifies your recurring purchases once it learns your spending. It does take some time to do the initial setup, but it will recognize your recurring bills going forward and classifies them accordingly. It also analyzes your habits and knows your upcoming bills, giving it all the tools to provide you with recommendations for how much you can spend and what you can really afford until payday rolls around. This feature is called “In My Pocket.” It will even send you notifications when bills are due if you want them.
Pocket Guard doesn’t really help you with budget goals, but it does give you a better idea of where your money is going. It also takes the tedious step of categorizing all of your expenses out of the picture. If you are used to doing a monthly budget, Pocket Guard will offer some great advantages. However, it can only update as fast as your bank or credit card, so there will be some lag time.
Acorns: An Easy Investing App
If you are looking for an app to help you with savings, then Acorns might be the answer. Acorns connects to your bank account, and it rounds up purchases to invest on your behalf. If you spend $13.68 on lunch, for example, Acorns will invest $0.32 in a diversified portfolio of stocks and bonds. Once your “roundups” hit a certain amount, like $5.00, it will withdraw the money from your account and invest it automatically. You can also make one-time payments to the investment account, or you can set up recurring deposits as well.
It is an extremely easy way to get started investing, and the best part is that the amounts are so small that you often do not even notice that the money was taken from your account.you often do not even notice that the money was taken from your account Click To Tweet It works great for young people that are just getting started with investing and do not have a lot to contribute. Acorns also sends you financial statements, so you have them for tax purposes and your records.
You can contribute as much as you want, whenever you want—the same goes for withdrawing money as well. It does cost $1.00 per month, which is a small price to pay for the investments it offers.
Keep in mind, however, that Acorns really is investing your money in the stock market. That means that there is a risk that you lose some of your money instead of simply saving it in a savings account or CD. This can be a scary prospect for someone who is trying to save money.
Good Budget: Staying Within Your Spending Goals
If you already have an idea of what you are spending on your regular bills, but you need some help to keep your variable expenses in line, Good Budget might be a “good” idea. It uses the envelope style of budgeting.
Envelope budgeting essentially allows you a certain amount of money in each of your spending areas. When it is used in real life, you physically stuff envelopes with cash at the beginning of the month. You can only spend what is in that envelope on that particular category. Once the cash is gone, then you cannot buy anymore. Good Budget gives you an on-the-go, virtual envelope system.
The system works great if you are trying to get certain spending categories under control, like… Click To TweetThe system works great if you are trying to get certain spending categories under control, like groceries, clothing, or eating out. Instead of looking at your bank account balance and seeing more money that you should be spending in that category, you only look at the category budget, which helps curb spending.
Good Budget also syncs with other devices so you and your spouse or others in your household can see total spending. It works well for couples who may be sharing bank accounts and finances. It is meant to encourage communication and discourage accidental overdraws.The app also has a full website so that you can see your budget information from nearly anywhere. It provides some helpful analysis of goals, trends, and other useful information.
One of the major drawbacks is that you have to actually remember to “take” the money out of your virtual envelope. There is no automatic classification function because it does not connect to your bank account. It is much more goal-based, however, which is extremely appealing for those who are not just trying to track spending, but are trying to change it.
ReadyForZero: Taking Control of Your Debt
You may not realize how much your debt is costing you every day. Getting rid of that debt faster than making your minimum payments can save you literally thousands of dollars in the long-term. ReadyForZero gives you a reality check when it comes to your debt. You simply hook up your debt accounts to ReadyForZero, including car payments, credit cards, student loans, and more, and the app takes care of the rest.ReadyForZero gives you a reality check when it comes to your debt Click To Tweet
ReadyForZero asks you to commit to a payment that is above your minimum payment for all of your debts combined. Then, it recommends specific payment amounts for each account to help you pay down your debt faster and in a way that will cost you as little money in interest as possible. It does not pay these bills for you, but it does track payments and interest for each account. For recent college graduates, ReadyForZero can be an extremely helpful way to see your total debt and what it will take to pay it off.
ReadyForZero gives you an estimated total payoff date for all your debt and each individual debt. It also provides you with a “daily interest” number. That is, it will show you how much your debt is costing you just sitting here. One fairly recent graduate that I know has a significant amount of debt after attending professional school. Her interest alone costs her $34.27 a day—that is $12,508.55 per year for debt that is just sitting there! She uses ReadyForZero as an almost daily reminder to work hard and earn more to cut that daily interest number down.
ReadyForZero will also send you payment reminders when upcoming bills are due, which can be a great way to avoid late fees and penalties. It also sends you little celebration e-mails and notifications when you hit milestones on your debts, such as when the debt is 25% paid off, 50% paid off, 75% paid off, and, finally, when it is completely paid off. For someone like my recent graduate friend, these little milestones are motivating because it is hard to see progress otherwise. ReadyForZero also just added a new feature that allows you to check your credit score right in the app as well.
Mint: The Popular Choice
An article on finance apps wouldn’t be complete without at least briefly mentioning Mint. Mint is easily one of the most popular budgeting apps, with over 15 million users. Perhaps its popularity is because it is virtually automatic and easy to use.it is virtually automatic and easy to use Click To Tweet Mint creates a budget for you based on your spending habits. It also provides a variety of other features including notifying you when your account changes in an unusual way, providing a free credit score, sending bill reminders, and tracking your spending habits.
Mint’s interface is very user-friendly, and the Mint team also provides budgeting and related finance tips that can be a great way to learn more about budgeting and saving money. You can even track investments. It also has some goal-setting features that resemble the envelope method of budgeting.
Mint has had some issues with syncing properly to bank accounts or other accounts. It will likely struggle if you use a local bank or credit union, for example. I have not been able to use this app for that reason.
Taking Control of Your Finances with Your Smartphone
Your smartphone can be an extremely useful tool for your budget. Whether you want to invest, save, budget, or pay off debt, there is an app for that. Many people end up using more than one app to meet their personal financial goals. You may need to try out a few before you find the one (or four) that works best for you.
Just be sure to do a little research on the app before you give them your personal information. Security is important when you are sharing sensitive financial data, so do a little bit of homework first.
Ultimately, everyone’s financial situation is slightly different, so find a method that fits with your budgeting habits and lifestyle.
Linda Hoffstader is a former real estate investment advisor and FHA loan underwriter for financial institutions such as Prudential, Franklin First Financial and Merill Lynch. Now retired and living in Boca Raton, Flordia, she spends her days sitting poolside educating people via her blog about the mortgage industry as well as how to help people take control over their personal finances. After having two kids and four grandchildren, she understands the importance of budgeting for a large family.