Creating a monthly budget and sticking to it is already daunting but coupled with a global pandemic like COVID-19, many Canadians are feeling extra anxiety about their finances. Luckily, budgeting and setting financial goals has gotten easier with the recent popularity of money management apps. These applications have earned rave reviews for their strategies and real-time tracking, but are they right for you? And can they keep up with the ever-changing financial landscape a pandemic brings?
To help you decide, here are the pros and cons of money management apps.
Pros of money management apps
Budgeting apps can be a cost-effective and user-friendly way to help you save. You can also find apps that focus on a specific financial goal, like saving for your retirement, buying a home, paying off debt, or even building an emergency fund. Most money management apps are free and easy-to-use, require very little setup, and can be customized to your liking. Once your setup is complete, you’ll have the option of linking your bank accounts to the app so you can see where your money is going in real-time.
Most apps also notify you of upcoming bill payments, which can keep your finances on track and help you avoid the high interest rates of late payments. Money management apps can also be a great way to minimize unwanted expenses and create long-term financial goals. Budgeting apps create concise and easy to understand breakdowns of your overall net worth, spending habits, and debts. This allows you to be fully aware of your financial situations with the click of a button and helps you avoid unwanted surprises.
Cons of money management apps
One of the major concerns when it comes to money management apps is security. Although almost everything we do in 2020 is online, many people might be apprehensive about sharing personal and financial information with third-party apps, since there’s a possibility of being hacked or having your personal information stolen. Before you download an app, you should make sure that it’s a reputable platform. You should also thoroughly read the privacy statement and make sure your data isn’t being sold and used for targeted ads.
Money management apps are designed to be user-friendly and accommodating but it does require you to do a bit of work. If you decide to budget using these tools, you must commit to regularly updating the information stored in your app to prevent inaccuracies that could negatively impact your finances.
Another thing to keep in mind is that technology isn’t fool-proof and can sometimes fail. Although the risk of you losing all your budgeting data is quite low, it is a possibility. If you are solely relying on a money management app, you should make a habit of backing up your budget and expenses data to prevent losing critical financial information.
At the end of the day, how you choose to save money is up to you. Whether you prefer to budget using online apps, working with a financial advisor who is plugged into the latest trends and forecasts, or even writing everything down using pen and paper, being aware of the money going in and out of your accounts is extremely important and can help protect you from future financial hardships, especially during these uncertain times.
To learn more about how Moya Financial can help guide you through your financial journey, contact us today!