Financial Apps for Lazy People

If you’re like me, you want to use your money well. You want to buy things you want. You want to pay yourself first by setting a few dollars aside for emergencies and investing a few coins for retirement. You want to pay your bills on time, and in full every month but those things rarely happen the way you know they should. Behavioral economics explains that most people do better when things are automated and we don’t have to actively make choices. Why do you think so many people know exactly what they need to do and then they still don’t do it?

Making good financial decisions with every single purchase day in and day out is challenging. Instead of making things harder for yourself why not use automatic savings and/or investment apps? Here is a round up of what’s available.

 

Apps for Automatic Saving

Digit – There is a free trial period of 100 days. It’s $2.99 a month after that. It basically uses an algorithm to figure out how much money can be moved from your checking account into your Digit savings account. Digit accounts are FDIC insured. There is a desktop version and an app. FAQs are here.

Qapital – Free. You set “rules” that tell the app when and how much money to move to your Qapital account to reach your savings goals. It’s a little more complicated than Digit. Qapital accounts are FDIC insured. App only. FAQs are here.

To read a comparison of Digit and Qapital, click here.

 

Apps for Automatic Investing

Acorns – It’s $1 per month for accounts with less than $5,000 in them. The app rounds up the change from purchases and invests the change in the stock market. Find out more here.

Stash – There is a $5 minimum and $1 monthly fee for accounts under $5,000. You decide when to invest and how much to invest. Find out more here.

 

Apps to Manage it All

Mint – Free.

YNAB You Need a Budget – Free for 34 days and $4.17 every month after that.

 

Personal Finance Software

Quicken Money – if you’re not a fan of phone apps but you’d still like to keep an eye on your money, this may be the software for you. It tracks spending, can track investments, and even comes with a free app if you’re so inclined.

 

Other Options

If all this sounds like a little too much, you can stick with the tools provided by your financial institution (many offer programs to help you save the change from transactions or create a holiday savings account), invest in your 401k or 403b through your job, or invest for retirement on your own by opening an Individual Retirement Account (IRA) through whatever company suits you.

Whatever works for you is best. There is no right or wrong. It’s important that you start now though. Even if you can only use the change from your purchases, something is always better than nothing. Take advantage of compound interest and start now.

 

 

 

 

Do Individual Development Accounts Work?

Individual Development Account (IDA) are one of the tools that encourage people to save. These accounts are managed by community organizations in every state in the US. and usually offer a monetary “match” to those that save a specific amount of money. For example, if you open an IDA with the promise to save $1,000 to open a business the community organization will promise to contribute an extra $3,000 giving you a total of $4,000 to open your business.

Community organizations claim that IDAs are great ways to help low income families save, but I’m not so sure. The motivation behind the IDAs is that low income families will be able to save money quickly and, hopefully, start making some long-term behavioral changes. My concern is that the matching is what motivates people to save. What motivates people to save when there is no matching? Everyone working in financial education understands that giving people more money isn’t the answer to ending poverty. Unless people decide to make different decisions they will be just as broke as they were before they received the money.

Click here to locate an IDA program in your city.

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Save Every Penny

I just read the most awesome article about saving pennies. The family managed to save $7,000 by saving every penny that they came across for five years. That’s right $7,000! 

The article is a great illustration of how important it is to take every dollar, and every penny, seriously. Think about how much money you could save by noticing where you’re money is being spent and making small changes. For example, in the office we use clip boards pretty often. We found out that the $6 clipboards we had buying from big box stores could be purchased from a local $0.99 store for… you guessed it…. $0.99! Making that chance had saved us about $15 a month. 

Are there any small changes that you can make that might save big bucks?

What We Say and Do Versus What We Really Say and Do

I read this article this weekend and I wanted to share it with you. The article talks about how sometimes when we save money from coupons, sales, etc. instead of saving it in an interest baring account we spend it.

I had to think about how many of the students we work with see older siblings, parents, relatives, etc. use this same strategy. We tell our kids that “we don’t have money for that” while we’re clipping coupons and asking neighbors for referrals to find that must have item with a low price tag and then turn around and buy something completly unnecessary. For example, I will tell my husband that we don’t have money to buy new $150 jeans then I’ll suggest that we go to dinner at our favorite Brazilian steakhouse that usually sets us back about $100. Curious, no?

In this time of financial uncertainty maybe we should all think about our choices. I mean the things that we do and say as well as the things that are non-verbal that others pick up on.

What are we teaching our children?