The fundamentals of being financially responsible are pretty simple and straight-forward:
- Budget within your means
- Save anything extra
- Invest for the future
There are 3 apps that have helped me successfully do these things without applying a ton of time or energy:
Mint – Budget Within Your Means
Mint is my favorite finance app. First, I connected my bank accounts to Mint as well as my credit cards. Next, I built a budget. Mint is able to give you suggestions on how much you should expect to spend within each category based on your historical spending. This piece of the set up takes a bit of time because you want to be intentional about where you plan to have your money going and what income you can expect to receive.
Once your budget is set up and your bank accounts are connected, the app is completely effortless and FREE. It will notify you when you have over-spent in certain categories. It will also notify you when a large transaction hits one of your accounts.
Mint gives me insight into where my spending is getting out of control so I can immediately dial back in those areas. For instance, if I look at my budget for the month of February right now, I can see that I have already overspent on clothes by $113 for this month. That is pretty bad and tells me I should probably avoid shopping for a new outfit for a month or two.
Mint also shows you trends of your credit score so you can keep an eye on any changes to your credit health right on the home page. You can use Mint to manage your upcoming bills so you never miss a payment.
Acorns – Save Anything Extra
Acorns links to your bank accounts and then rounds your transactions up to the nearest dollar. That spare change is then invested in Exchange Traded Funds (ETFs) based on your preferred investment risk level for just $1 per month. An ETF is a compilation of other investment options all bundled together into one security. Investing in ETFs gives you the ability to diversify your investment within one security. There are different categories or risk-levels of ETFs, for example, you could buy an ETF of all tech companies stock or you could buy an ETF that is full of foreign stocks and bonds to put some of your money in the markets overseas. For $2 per month you could have Acorns set up retirement funds with your spare change which has tax benefits for your investments.
I recommend setting up your 401K with your employer so some money is contributed from your salary each month and then additionally linking Acorns to your bank accounts to collect your spare change. This would create two savings methods for you and should ensure that you are saving responsibly for the future.
Robinhood – Invest for The Future
Although Acorns itself helps you invest in the future, there is another great tool for getting your feet wet in investing in the stock market, Robinhood. Robinhood is free for all of the basic functionalities you need for stock trading. I don’t put a large chunk of my savings into Robinhood because the stock market can be very volatile but it is neat to be able to follow the markets and start seeing the trends.
Robinhood allows you to buy and sell stocks with your own cash. It provides you great portfolio analytics and you’re able to sell out and withdraw your cash back to your bank account within a few days for free if you need to so it can be a pretty liquid investing option. That being said, you will make the most profits from the stock market by doing your research, buying low and holding for a long period of time, so I don’t recommend getting tied up in day trading and using the stock market as a short-term investing tool.
I do recommend putting some money in a few Robinhood stocks that you have heavily researched and then watching the way the economy, news and markets fluctuate together. Robinhood pulls news articles about each stock so you can stay well-informed on the markets and you can listen to live earnings calls through the app. It is an awesome app for entry-level investors.
These apps are free to download and are easy to use. Your bank account will thank you for giving them a shot!