My Four Favorite Budgeting Apps (and they are free!)

four favorite budgeting apps

 

As a finance professor, people ask me a lot of questions. One of the most common questions is about ways to make budgeting easier or if “there is an app for that.” There are two difficult parts to the budgeting process. The first part is sitting down to actually make a budget. The second part is knowing where you are in your budget and sticking to it. For me, this is by far the more challenging task because it takes time to record your expenses. I’m always looking for an app to help make my life more efficient, so I have actually tried a lot of budgeting apps over the years. Today I’ve decided to share four of my current favorites.

 

mint money budget app
Mint: Money Manager, Budget, and Personal Finance is a free app that provides a complete money management toolbox for users. You can connect all of your bank, credit card, and investment apps to your personal Mint account and let the app do the rest. Mint will keep track of your spending and income and even make suggestions for how you can improve your budget. If you want an app that will literally track and do everything for you, Mint is the way to go. Personally, I don’t want to use this app for security reasons. I don’t like the idea of tying all of my financial accounts into this one place. If you don’t mind, however, you won’t find anything better than this.

 

daily budget original money budget app
Daily Budget Original is a free app that provides you will a daily budget after you enter your monthly income and fixed expenses. Since it does not connect to your bank account, there is some work on your part. Each time you make a purchase, you’ll need to enter that into the app so that it can deduct that dollar amount from your daily allowance. However, the app is simple and easy to use.

 

mvelopes money budgeting app
Mvelopes is a nice, free app if you are fond of the envelope method of budgeting. You can set up the categories, or envelopes, of your monthly expenses as needed. These are fully customizable, so you can have just a few, broad categories or envelopes for individual expenses like cable, coffee, cell phone, gym membership, etc. Mvelopes will also connect to all of your financial accounts (like Mint) and automatically deduct your expenses. Again, this has the benefit of taking the work out of the equation for you, but be careful about keeping your accounts and identity secured.

 

wellspent money budgeting app
WellSpent is another free app also based on the envelope method of budgeting. Unlike Mvelopes, however, WellSpent does not connect to any of your financial accounts. So, you’ll have to be diligent about entering all of your daily expenses. Once you get into a habit of entering expenses as you go or at a certain time of the day (take a minute to do it while eating lunch or at the end of each day), you’ll find this is an incredibly useful budgeting app. You have the flexibility to add as many envelope categories as you want and track your spending in each category in real-time.

  
Do you use an app for budgeting? If so, do you use one of these or something else? If you do not use a budgeting app, which of these sounds the best to you?

new year's resolution financial check-u

New Year’s Resolution Checkup

new year's resolution financial check-u

 

Did you make a New Year’s resolution for your finances? Now is a good time to check up on how you are doing with those resolutions. If you are still on track, congratulations! If you are struggling to keep your resolution, don’t give up. Evaluate where you are going wrong and resolve to get back on track.

 

According to a study by Fidelity Investments, saving money is the top financial resolution. Everyone has the best of intentions when it comes to saving money. Unfortunately, you need more than a resolution. You need a plan. The Internet is full of creative ways to save money from collecting all your change or five-dollar bills to saving an increasing amount of money each month through the year. These are all a great way to save a little extra, but they all have the same flaw. It’s easy to find a reason each month not to save that money. So, setting up an automatic deposit from your paycheck into a savings account is a much better plan.

 

If you are trying to save money, you need to spend less. Chances are that if you take a good look at where your money goes during the week, you’ll find some easy places to spend less. Keep track of every penny for the next 7-10 days. Then go back and look if your actions match your goals and intentions. Think about all the money you could save if you made your own coffee instead of buying it every day for a year. How much are you spending on meals you are not making at home? Try bringing a lunch to work and finding easy meal solutions for weeknights. You don’t have to be extreme, but utilize coupons, savings apps, and store rewards cards. Do you have a gym membership or fees for other monthly services that you are not using? Can you cut your phone or cable services? Making little changes to your spending habits can add up to big savings over the course of a year.

 

Paying down credit cards and other debt is the second most popular financial resolution. Gather information about the amount owed, payment, and interest rate on all of your debts and make a plan of attack. Credit cards should be your first priority. Rank them based on interest rate or total balance and set out to pay them off one by one. Only after you have done that should you look at other debts. Car loans and other consumer debts should fall into a second tier. If you have no other debt and are already saving and investing, focus on student loans and mortgage debt. Both of these sources of debt usually have very low interest rates, and the interest you pay is a tax deduction.

 

Only about 10% of study participants cited budgeting as a resolution. Yet, making a budget and sticking to it is necessary to finding success with any other financial goal. Make an honest assessment of your income and monthly expenses. Create categories of expenses and set a monthly spending limit for each category. There are some great computer programs and phone apps that will help you record your expenses in different categories so that you can have a real-time picture of how well you are doing sticking to your budget. It really is so much easier to stick to your budget and attain your financial goals when diligently track your progress every month.
financial health resolution

Five Steps for Assessing Your Financial Health in the New Year

financial health resolution
source: freeimages.com

 

Whether you have made financial resolutions for the New Year or not, it is a great time to evaluate your finances as well as your waistline. While thinking about your health, consider your financial health. While making plans and setting goals for the year ahead, make sure you have a financial plan to make those things happen as well. Here are five ways you should be getting a financial check-up for 2016.

 

Debt

Take an honest look at all of your sources of debt and the minimum monthly payments. Remember to include all of your debt obligations – credit cards, student loans, car loans, mortgage, or any other monthly debts. Are you only paying the minimum? Are you taking on more debt every month or in the process of paying down your total outstanding balance? Do you have a plan to address your debt situation?

 

Savings

Americans are not great at saving, but the good news is that many of us are starting to get the picture. Although far off the historical average of over 8%, the savings rate in the United States is up from last year to 5.5%. How are you doing at saving? If you have a plan for saving, stick to it. If this is a place you are falling short, make a plan to turn it around and increase your savings now. Consider having a portion of your pay automatically transferred into a savings account. Try a twelve-month savings challenge such as this one that I did last year.

 

Budget

The New Year is a great time to re-evaluate your budget. Is it still working for you? Where do you need to make adjustments? Is there a certain category where you keep going over budget every month? If so, think about what you can do to get that back in line or where you can make adjustments to other categories to account for higher costs. Simply continuing to go over budget is not a long-term viable solution. Do your New Years resolutions include things like gym memberships, travel, and eating out less often? Update your budget accordingly.

 

Retirement

Some people watch their retirement accounts like a hawk and are constantly making trades. I am not one of those people. First, I have a long way to go until I hit retirement age. This is not one of those posts telling you how to retire by 40. Second, I invest my retirement savings with a rather simple long-term philosophy. When you are over twenty years from retirement, put most of your money into the stock market. Spread a little across real estate, money market, and bonds. When you cross over that line and have fewer than twenty years to retirement, slowly start flipping that equation in the other direction to take money out of stocks. I do, however, recommend rebalancing your retirement account every quarter. So, go ahead and do that this month.

 

Tax

Unfortunately, its’s about time to start thinking about filing your income taxes again. The most horrible time of the year, right? Before you start having a tax panic attack, do one simple thing. Make sure that your employer is allocating the proper number of allowances on your W2 for the upcoming year. This will save you a lot of grief next year at this time.