Save and Track Spending With Mobile Banking Apps
What to Look for (and Watch out for) in Mobile Budgeting and Banking
Mobile banking usage has grown steadily over the past few years, and the trend is expected to continue.
According to a report called “Consumers and Mobile Financial Services,” released by the Federal Reserve in March 2014, one-third of all cellphone owners used mobile banking during the past 12 months. That figure rises to 51 percent among owners of smartphones, which essentially are mini computers.
The use of mobile banking likely is to remain on the upswing, the Federal Reserve report states, as more consumers trade their old flip phones for smartphones and as financial institutions embrace new digital tools.
“Any technology that helps you keep track of your spending and, more importantly, your savings, will go a long way,” says financial planner Pam Dumonceau, president of Denver, Colo.-based registered investment advisor Consistent Values.
Dumonceau says tracking spending and savings is the key to successful budgeting, which is “the foundation to building wealth over time.”
With that in mind, here are a few established mobile banking and budgeting apps to consider:
Mint’s popular money management service, owned by financial software giant Intuit, is accessible via a Web browser or a mobile app.
“For people new to budgeting, there is no better place to start than Mint,” says Eric Rosenberg, founder of Narrow Bridge Finance, a personal finance blog.
While Intuit offers a paid version of the financial management software through its Quicken brand, Rosenberg says he prefers the free version from Mint.
“I can create easy-to-use budgets and goals that automatically update based on my everyday spending,” says Rosenberg.
After a user links his or her banking, credit card, and other account information to Mint, the program displays the data in simple-to-understand charts and graphs. The mobile app also sends the user alerts when bills are due and when an account has a low balance.
This free app, available on Android and iOS, gives you free access to your credit score, with no strings attached. You don’t even need to enter a credit card number. The registration process takes just a few minutes, though you will have to provide your Social Security number and answer a few questions about your credit history.
After signing up, the app instantly displays your credit score and how you rank against other consumers nationwide. It also provides a “credit report card” that grades you on a handful of credit-risk factors, such as percentage of on-time payments.
Banking Institution Apps
Mobile apps from major financial institutions such as Wells Fargo, Chase, and Bank of America offer a great way to view your account information, transfer money, and perform other transactions without having to share personal information with a third-party service such as Mint.
One of the more convenient services offered through bank apps is the ability to make a deposit by snapping photos of the front and back of a check. The use of this service is quickly growing. The Federal Reserve report found that 38 percent of mobile bankers have deposited a check using their mobile phone in the past 12 months, up from 21 percent in 2012.
This 99-cent app is a simple way to manage your weekly spending. Set a budget and enter expenditures throughout the week, and the program will let you know whether you passed or failed.
You can review historical spending patterns and export the information to other applications. Users have embraced this app’s straightforward format, giving it a stellar 4.5 star rating in the iTunes App Store as well as Google’s Play Store.
Personal Capital bills itself as “your next generation financial advisor.” While My Weekly Budget is geared toward everyday finances, this online aggregation tool is perhaps best suited for big investors.
“I have used the tools in Personal Capital to save hundreds of dollars a year on mutual fund fees, which can help save tens of thousands of dollars over the longtime horizon to retirement,” says Rosenberg.
You can track investments, access research, and view other information online or via Personal Capital’s smartphone apps, available for Android and iOS. This wealth management software links your checking, savings, brokerage, mortgage, and other loan accounts for free. The company charges for an optional investment management service.
This free Android and iOS app aims to help consumers save. It automatically transfers a preset amount of money from a user’s checking account to his or her savings account each time the user makes a purchase. The user presets that amount, from 5 percent to 20 percent of the amount he or she spends.
The program features some safeguards, such as the ability to set a minimum checking account balance that would turn off automatic transfers. SavedPlus doesn’t yet work with all banks and credit unions, depending on the institution’s authentication requirements.
A Note on Security and Privacy
If you plan to give mobile banking and budgeting a shot, there are a couple of things to keep in mind. Although some apps may be free to download and use, they likely will feature advertisements or revenue-sharing partnerships with third-party services that often are recommended within the program.
Furthermore, the Federal Reserve report notes “consumers will need to understand and weigh the benefits and potential risks to their security and privacy presented by the use of this new technology.”
For the most part, untrustworthy or malicious apps are weeded out through user rankings and Apple and Google’s self-monitoring. But an occasional bad apple may slip through the cracks, so it’s a good idea to stick with established brands or read multiple user reviews before downloading a program.
[Any reference to a specific company, commercial product, process or service does not constitute or imply an endorsement or recommendation by the National Endowment for Financial Education.]