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Financial apps are incredibly popular – nearly two thirds of smartphone users have at least one financial app on their phone. And given their potential, this is really no surprise. The mobile money market (including banks and third parties) now processes $1.3 billion every day; as banking, investing and saving all move online, using an app to manage these aspects of your life simply makes sense.
Not every app is created equal though, and as with any financial decision, it’s important to understand the risks and benefits of your choice. So to help, we have broken out everything you need to consider when using these tools – starting with a list of some of the most reputable and popular financial apps on the market. Click on any of the names in the table below to learn more about them.
A financial app is a downloadable, mobile financial management tool that can be used for a variety of purposes. Typically, financial apps integrate with the other financial aspects of your life, and are therefore simpler to use than standalone budgeting methods, and much more accessible than traditional wealth management tools.
Financial apps have a wide range of uses, including:
These apps rely on users either manually inputting data or linking their bank accounts, credit cards and other financial details into the app, so the app can automatically track their use.
The majority of people use financial apps for two main purposes: tracking spending, and paying bills. A massive 92% of 18 to 37 year olds report using financial apps for just these reasons. And at this level, using a financial app is very simple:
For those hoping to achieve a little more through their financial app, such as managing an investment portfolio or trading stocks, then there are plenty of options for you too. Many of these apps work on a similar premise to the above, but simply require more interactive use from you on an ongoing basis. All of the apps are designed to be user-friendly and practical for people with any level of financial literacy.
There are a few major types of financial app - although one or two of the major players offer cross-functionality. In general though, they fall into one of the following categories:
Debt payoff apps help you to manage your ongoing expenses, highlight problem areas, keep a balanced budget, and make payments towards your debt - all to help you move towards debt-free status as quickly and practically as possible. Some of these apps utilize extra cash in your account to make smart payments towards your debt.
Wealth management apps combine everyday financial planning with long term investment strategies, so you can manage your assets and investments, and optimize. They also allow you to cross-analyze your investments by region, type, risk, and so on, to properly understand your portfolio as a whole.
Investment apps allow you to proactively make investments, buy, sell, trade, and otherwise engage in varied financial markets. These apps are not just for the super-rich; you need very little money to open an online brokerage account, and micro-investing apps are becoming increasingly popular.
Investing can be very active with frequent trading (i.e. day trading) or more passive. You can learn about day trading at Wealthsimple, which is one of the most popular trading apps.
Bill payment apps allow you to track, monitor and automate your bill payments. This helps you to avoid late fees and penalties, keep track of big expenses coming up, and stay on top of your budget.
Bookkeeping tools are nothing new, but the mobile apps now available make bookkeeping much easier than ever before. These accounting tools allow you to record and monitor your business’s finances, without the need for an accountant!
There are many benefits to using financial apps, including:
There is no such thing as a completely secure mobile technology, and fraud is one of the most common concerns surrounding financial apps - especially those that link to bank accounts and credit cards. At particular risk are apps which do not supply the same level of security as you’d expect with online or mobile banking. This happens because third party providers are not under the same scrutiny or regulatory requirements as financial institutions.
In practice, suspect apps can sometimes be easy to spot (for example, the app displays your full account numbers), or might be harder to identify (for example, if a platform does not utilize end-to-end encryption). It is extremely important to make sure you are using a secure, reputable app for your financial management.
On a similar note, identity theft is sometimes a concern for financial app users, as financial apps hold almost all of your personal information in one place. Again, this means ensuring the safety of the app you use is paramount.
Choosing the right app for you need not be complicated. Simply follow these guidelines:
A financial app is a downloadable, mobile financial management tool that can be used for a variety of purposes, including managing a budget, saving, investing, managing shared expenses, managing your credit, and much more.
Financial apps are generally pretty easy to use. You can download them onto your phone (or tablet), and then input your personal information. Many link with your bank accounts and credit cards so that data entry is automated. You can then use the app for the purpose you need - managing a budget, investing, saving, and so on.
The cost of financial apps vary; some are free, others have some functionality for free and then require a fee for more advanced use, and others require a subscription or have a download fee. Be sure to thoroughly research the cost structure of the apps you are considering, to understand both their initial and ongoing costs.
Financial apps can be safe to use, if you go with a reputable company. Good financial apps will have security measures on par with mobile or online banking, but there are providers who do not take these precautions. Thoroughly research a company before downloading its app to ensure it’s safe.
Many financial apps will allow you to link your bank accounts, credit cards and investment vehicles to your app, so that you can seamlessly manage your finances from one location. Ensure the app you are looking at has this option before you download it though, as some apps require manual data entry.
There are many different financial apps available, for all sorts of purposes, so choosing the best one for you depends on what you need it for. There are some multi-purpose apps that offer lots of different functionality, so if you’re hoping for a one-stop-shop for your money management, one of these is probably the best bet.
You can use a financial app for many different reasons: saving, paying off debt, automating bill payments, maintaining a budget, investing, managing assets, managing shared expenses, and so on. Almost any aspect of personal finance can be handled through a dedicated app.
Absolutely not! The barrier to entry for investment apps is very low, and many do not have a minimum threshold. There are in fact an increasing number of micro-investment apps geared specifically for those hoping to make small investments rather than big ones.
