You know the saying, “there’s an app for that”, well when it comes to managing your money there are “personal finance apps” for that!

Forget about Microsoft Money or spreadsheets, personal finance apps can bring your money to life like never before and the best of all, the majority of them are free!

In this blog I explain how they work and everything you need to know.

Why personal finance apps are better than banks

If like me you can remember 2008, you will know that it wasn’t a good time for banks.

Excessive lending and chasing sales targets and profits above all else nearly led to the downfall of the entire banking system.

If 2008 was a time you were starting to earn money and using a bank for the first time you have probably never really trusted the banking system.  

According to BI Intelligence data nearly three-quarters of millennials with a bank account visit a branch once or less a month and slightly less than 40% of millennials do not visit physical banks at all.

No longer are we staying loyal to the same current account we have always had.

Now more than ever we are using multiple bank accounts and credit cards to take advantage of deals and offers. In fact, there’s no need to even use a traditional high street bank as there are a whole range of new mobile current account providers.

You can also add pensions, savings and mortgages to the list of financial products that you will most likely have accumulated.

But if you want financial advice where do you go? The banks are only interested in selling you their products, and independent financial advice is very expensive.

This is where personal finance apps can help.

A personal finance app is technology that collates your financial life into one app. You can see everything in one place and it is live data.

Not only that, it allows you to manage your money and financial life like never before.

Let me explain.

How do personal finance apps work?

Essentially personal finance apps are apps available to download on your phone. All the most popular finance apps are available from both Apple’s App Store and Google’s Play Store.

They all take a little bit of time and preparation to get them set up so you can get the most out of them. But don’t worry it’s a simple process and goes a bit like this:

  • Download the app of choice and set up a user name and password.
  • The first big job will be to link your bank accounts.
  • You do this via the personal finance app who will ask you to confirm your online bank login details so it can securely connect to your bank and download the relevant data.
  • Personal finance apps only ever have read only access to your bank account data and use bank level security to encrypt it.
  • Once you have connected all your bank accounts and credit cards, depending on the particular app you have chosen you could also connect your pension and mortgage accounts.
  • After all your accounts are connected the other big job is to go through the last few months of transactions that have pulled through and make sure they have been categorised correctly by the finance app.
  • It’s worth spending time on this as the personal finance app will start to learn what should go where. They are clever like that!

After this initial set up phase you are good to go and each time you log in to your personal finance app it will sync with all your accounts and pull through your live data.

This means you will be able to see a live view of all your balances in one place. No more logging into different accounts and recording everything manually.

After a while you will probably then feel comfortable exploring some more of the money management features personal finance apps can offer.

Features like:

  • Setting a savings target.
  • Setting a budget and being notified of when you are close.
  • Price comparisons to get a better deal on your utility bills.
  • Spending tracker keeping your money safe by ticking off and reconciling transactions to protect you against fraud.

If you prefer your data visually rather than numbers and text you will love it as the graphics in most of these personal finance apps are great and really bring your money to life.

4 of the more well known personal finance apps.

#1 – Yolt

Yolt is free to use and information is presented in lovely looking dashboards which you can customise.

You can record the renewal dates of your utility contracts and use the comparison feature to look for better energy deals as well as ways to send money abroad.

The bank accounts available to link with are limited.

#2 – Moneyhub

You can get a 30 day free trial of Moneyhub, after that it costs 99p a month or £9.99 if you pay for the year upfront. You can continue to use the app after the trial without paying but you won’t receive any live data so a bit pointless really.

Money hub has a really useful feature called the transaction inbox which allows you to tick off and check each transaction you make so you know it’s genuine and categorised correctly. Once ticked it moves out of your transaction inbox so you know you are up to date.

#3 – Money Dashboard 

Money Dashboard is free and really easy to use. It’s probably the most simple in terms of use and the type of information you can get out of it.

Definitely a good one for beginners.

#4 – Cleo 

Cleo isn’t actually an app you can download but a chatbot programme that runs through Facebook Messenger. So if you are always using Facebook Messenger to communicate with your friends then this could be the programme for you.

It’s free to use and is a bit like having your own friend who you can communicate with and ask questions about your money. Very clever!

Find out what happened when I chatted to Cleo about my money

The beauty of using personal finance apps is that you don’t need to check them every day. You can spend a bit of time setting everything up and then it’s like a little digital financial adviser managing your money for you in the background.

If you feel like taking a look you can log in instantly to see exactly where you stand financially.

So don’t rely on the old fashioned banks for financial advice or money management. Take back control and be in charge of your own finances.Which of the personal finance apps have you tried? What are your favourite features? I’d love to know. Join the conversation here.

Risk warning:

Stock market linked investments and any income from them, can fall as well as rise and is not guaranteed. Any figures quoted are for illustrative purposes and should not be taken as a forecast or guarantee. Past performance should not be seen as an indication of future returns and clients may get back less than they have invested.