From online banking, to investing platforms, to full service budgeting apps, most smartphone users are now using some kind of app to manage their money. Gone are the days when you had to record transactions in your checkbook ledger, go to the bank to deposit a check, or wait for your monthly statement to see your current account value. But with all of the new fintech (financial technology)and budgeting apps available now, you might be wondering: are budgeting apps worth it?

It’s pretty clear that online banking and money management tools are here to stay. That’s a good thing for a Millennial like me who remembers the days of receiving physical, paper paychecks and abhorred having to go to the bank to deposit checks. Mobile check deposit is truly magical.

But what about budgeting apps—are they worth it?

It depends. Whether or not a budgeting app is worth it depends on your preferences and what works for you. There’s nothing wrong with using a system that is working for you, even if it is pen and paper. You don’t need to jump on the budgeting app train just because that’s the latest thing.

What Does a Budgeting App Do?

At a basic level, all budgeting apps link your financial information together so you can see it in one place and provide a variety of tools to help you track how you spend your money and make sure your bills get paid on time.

Some budgeting apps, such as Mint.com or Personal Capital are primarily money tracking systems that help you see where your money went. Others, such as EveryDollar or YNAB provide tools to help you plan out where all of your money will go. Each app comes with its own focus and set of extra tools, whether it is tips on saving money, charts to show you trends, or even investing help.

quiz: which budgeting method works for you? Take the quiz.

Benefits of a Budgeting App

Budgeting apps provide a number of benefits, making them a popular way to manage money.

1. Convenience

It’s so much easier to manage your money when you can open your app and see everything in one place.

2. Increased awareness

One of the most important parts of managing your money is having awareness of how much you have and where it all goes. Budgeting apps help you easily see and analyze your financial information so that you make more intentional decisions about how you want to use your money.

3. Time Savings

It can be time consuming to write out and track your financial information on a regular basis. Apps do it all for you and can save you significant amounts of time.

4. Tools and resources to help you meet your goals

Whether you want to rebalance your portfolio, get out of debt, save more, or something else, budgeting apps have tools and tips at your disposal to help.

In general, budgeting apps make managing your money much easier by automating tasks and keeping your information in one place.

budget tracking website on laptop — *Image:* *@sincerelymedia* *on Unsplash*

Disadvantages of Budgeting Apps

Some people love budgeting apps and find that there are no disadvantages at all. Others, however, express the following concerns:

1. Security

Budgeting apps are generally pretty safe since most of them follow encryption protocols. Banks aren’t going to let an app with lax security access their information. However, with the internet there is always a risk that someone could hack in and steal your information. If you use an app, be sure to follow online security recommendations. And if you’re just not comfortable with apps having access to your financial information, other methods of managing your money are just fine too.

2. Functionality

Some budgeting app users have reported frustrations with linking accounts and getting the right information pulled over.

3. Usability

Some apps have a steeper learning curve, particularly those that go beyond simply tracking your money and have you assign categories or jobs for every dollar you earn. Those willing to invest the time to learn the system are generally happy, but if you don’t have time or energy to do so, you may want to try a different system.

If budgeting apps aren’t for you, click here to get my free budgeting template for Excel or Google Sheets.

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Are Budgeting Apps Worth It?

Budgeting apps make a lot of big promises. If their claims are to be believed, you’ll take control of your money, get out of debt, save more money, and achieve your financial goals. And while budgeting apps can help you do all of these things, the truth is that it is still up to you. Any budgeting system only works to the extent that you use it.

A budgeting app that works for one person may not work for another. It could be that the system the app uses is a poor match or you never get around to using it. Or perhaps you have some emotions or underlying financial behaviors that need to be addressed. After all, a budget can’t force you to stop spending money.

So if you are signing up for an app thinking that it is somehow going to magically transform your finances, you may or may not be right. What is far more important than which app or system you use is your mindset and creating a system that works for you.

After all, a budget is simply a tool to help you manage your money and achieve your financial and life goals.

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