Creating and maintaining a budget can be a difficult task. So much so, that a Gallop poll suggests only 32 percent of Americans actively keep a budget. Sadly, those who do not track spending are more likely to make late payments, be prone to overspending, live beyond their means, and spend money on impulse purchases rather than based on priorities.
For the most part we all know you should keep a budget. Yet they seem cumbersome, restricting and difficult to track. You may logically understand that keeping a budget will help you get your financial house in order, but doing it is another matter.
Free high quality apps are now available and can be accessed from computers, tablets and smart phones. Most apps are compatible with both iOS and Android devices, with some adding features compatible with windows laptops or desktops. Using apps on your computer or smart device such as your phone or tablet can create an easy system that you can actually maintain.
There are a number of free apps used by millions of consumers to help track spending, budgeting tools, increase savings, and even track investment accounts. Some of these apps have a basic version that is free but an upgraded version with additional features is also available for a low monthly fee. Start with the free platform first and see how the tool best helps you stay on track, and upgrade accordingly if you see more tools offered that adds value and ease. One that you will actually use will be the best advantage, so “to each their own”
Apps make the assumption that nearly all purchases will be made with a debit or credit card. Cash purchases generally can be manually entered, which you can easily forget to do.
Apps That Track Spending. Most budgeting apps that track spending will sync to your bank accounts (and sometimes your credit cards) to automate the tracking process. This adds a level of convenience as you don’t have to manually enter information beyond the initial setup of the app. You might also be able to sync across devices, though these services often require a small monthly fee. The advantage of additional syncing is that you can access your account from multiple phones or tablets which can help you coordinate spending with a spouse or other party, reducing miscommunication that can result in high fees.
These devices also help reduce late payments and help you see how you are doing. There are generally charts and graphs to show how much was spent in various categories, allowing you to adjust spending patterns and save money.
For those who do not trust the security of the apps, there are a few spending tracking apps like Appxy Pocket Expense and Good Budget that have manual entries. With a few clicks, expenses can be added to your budget as you choose.
Two apps that use the envelope system are more about expense planning and simply tracking. Two companies with an electronic envelope system are Mvelopes and Good Budget. The theory behind these apps is that with each deposit a certain amount in set aside in each “envelope” or budget category and then you are clear about what can be spent where. This tried and true budgeting strategy is greatly simplified through the online process and can also help you save for large expenses like a vacation or holiday spending. You are able to aside a certain amount with each paycheck in the “envelope” that will not be spent.
Wally is a unique app that allows you to scan receipts, in addition to the traditional tracking features. This prevents the need for manual entries and enables you to maintain receipts electronically rather than keeping paper receipts. This feature is very useful for the self-employed or independent contractors who must track receipts to gain tax deductions.
Apps That Track Spending and Investments. Mint.com is the leader in the industry for a comprehensive budget solution covering all areas of your financial life. This app is free and will link to both bank accounts and investment accounts, giving you a complete financial picture. This app will track spending, create a budget, track investments, and send alerts. They also offer a free credit score when you sign up.
Apps That Track Spending and Have an Auto Save Feature. There are apps that will help you track spending along with putting money in a savings account. If you have trouble contributing to an emergency fund, this may be a feature you will really benefit from. Each of these apps works a little differently but the principle is the same: to automate a savings plan with small deposits, building balances without a noticeable impact on your budget. Studies have shown the best way to increase savings it to automate the process. These apps complete this task in a way you will hardly notice until you see your growing savings account.
Acorn is an app that syncs to your checking and credit card accounts. Each time you make a purchase the amount is rounded up to the next dollar and invested in low cost ETF’s. The site claims users save between $30 to $180 a month using this method. That can add up to $360 to $2160 each year. You are also able to add lump sums to the account if you choose.
Digit also syncs with your accounts and studies real time spending patterns. Then it will automatically move small amounts of money into a savings account and send you a text notification of the activity. You can access the savings at any time. The advantage to this app is that you do not have to make a decision about how much to save. Each week the app will move a few dollars over based on your actual spending.
Level Money syncs with your accounts and then intuitively suggests discretionary spending amounts for each day, week and month. It then gives you control over the amount you want to put into savings through an auto save feature. This gives you more control than Digit, while still encouraging you to set aside a little each week in a separate account.
Apps That Track Spending, Recurring Charges/Memberships and Provide Fraud Protection. Bill Guard offers a unique feature in that it not only tracks spending but also has you approve all charges on your account. How often have you signed up for a free 30-day trial and then forgot to cancel? This app will catch those charges so they don’t fall through the cracks. On the spending side you approve each purchase. When you review purchases at the end of the day or week you are much more likely to remember all your purchases, than a month later when you statement arrives. This feature helps you catch unauthorized spending almost immediately and includes a dispute feature that makes contacting the card provider easy.
Apps That Track Spending and Credit. Credit Karma rules the space for an app that both tracks spending and tracks credit scores and credit reports. They also recommend products that might help reduce interest rates based on your credit file. This added convenience has the ability to reduce your costs through more efficient credit selections.
Whatever app you choose, if you have trouble creating and sticking to a budget then utilizing the latest technology can be an efficient way to keep up with your money. Whichever you choose, stick with one or two only, so you can learn its tools that best fit your own needs. This way you will use it consistently and track accordingly without confusion.