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Thanks to technology, it’s easier than ever to manage our finances. But some tools are better than others. We found 10 of the best financial tools to make managing your money a breeze.
Out of the Dark Ages
When is the last time deposited or mailed a check? When is the last time you actually went into a branch to do anything other than withdraw money from a cash machine?
I met a college student recently who didn’t know how to write a check. It seemed absurd to me at first but after thinking about it for a moment, when is the last time I wrote a check?
I don’t even have paper checks apart from the three free ones they give you when you open your checking account.
Technology has changed the way we handle money.
The first step to becoming financially literate is to make and follow a budget. These programs make it easy.
I will always have a soft spot in my heart for Mint. When I finally decided to take control of my finances, Mint was the first tool in my arsenal.
Since then, I have written about and tried out many of the other budgeting tools out there, but Mint still stands apart.
It’s easy to use which makes it the ideal “gateway drug” for anyone looking to better themselves financially.
Money and finances can be intimidating for beginners, but when they see how easy Mint makes budgeting, they feel more confident to tackle other areas of their finances like investing or refinancing a loan for a lower interest rate.
Not only is Mint easy to use, but it’s also free!
2. You Need a Budget
YNAB has almost a cult following. It even has its own sub-Reddit! YNAB does have something of a learning curve but getting comfortable with the program forces users to be more mindful of their money which is an especially good thing for those new to personal finance.
The core of YNAB is that every dollar has a job and it’s up to the user to assign those jobs. When you budget with YNAB, you save money from last month to pay for the next month’s expenses.
What you earn in March is spent in April. You spend money you’ve already made, not money yet to be earned.
For people who have an irregular income like freelancers or those who work on commission, YNAB is ideal. You don’t need to know what you have coming in next month because you are spending what you made last month.
YNAB is not free, it’s $6.99 per month, but they do offer a free 34 day trial and tons of support for new and existing users including webinars.
If you want to grow your wealth, you have to start investing and the sooner, the better. Many people don’t invest because they think they have to know a lot about stocks and bonds and bears and bulls to do it.
But the longer you wait, the more money you leave on the table. If you have been too scared to start investing, these tools make it easy.
Like Mint, Betterment has a special place in my heart. It was Step Two in my goal of becoming financially savvy. I didn’t know anything about investing at all, but with Betterment, you don’t have to.
Nor do you need a lot of money to start investing. That’s the other reason many people fail to invest; they think you need a big bank account to do it.
Not with Betterment! There is no minimum to start investing. If you have $1, you can open an account with Betterment.
You will just answer a few questions that will help determine your risk tolerance and your investing goals.
Based on your answers, Betterment will recommend an aggressive, moderate, or conservative portfolio allocation.
Your portfolio is created with an algorithm and invests across major market sectors. Betterment uses index-based exchange traded funds (ETFs) which are low cost and tax efficient.
This is why Betterment has such low fees, and fees are something to be mindful of because, over time, they can eat up a big chunk of your investments.
Depending on the amount you invest with Betterment, the fees range from 0.25%-0.50%.
Anything under 1% is pretty darn good when it comes to investing fees, and you can see that Betterment’s fees are well under that.
You can set up auto deposits into your account, so you don’t even have to remember to invest. That’s it! All you have to do is open an account and deposit money into it.
Betterment believes investing should be accessible to anyone and they have made it so.
Real estate investing can be a good addition to your portfolio, but if you didn’t have big money, you were left out in the cold. But not any longer.
Fundrise is a crowdsourced real estate investment platform that allows everyday people access to investments they could never afford individually.
Fundrise lets you invest in eREITs or eFunds. An eREIT is a professionally managed a diverse portfolio of commercial real estate properties like apartment and office buildings, shopping malls and hotels.
If these sound tempting, Fundrise is offering a starter portfolio of eREITs for only $500! The money is invested in more than 20 properties all around the US, so your investment is well diversified.
There are three investments in the starter portfolio, the East, West, and Heartland eREITs and since the first quarter of 2017, all have paid out quarterly distributions although as with any investment, past performance is not a guarantee of future performance.
If you thought you had to wait until you had at least a 20% down payment to buy a rental property or enough money to be considered an accredited investor before you could add real estate to your portfolio, Fundrise proves otherwise.
Knowing your credit score is as important as knowing your bank balance.
Having a good credit score lets us borrow money at better rates and can even determine whether or not we can rent an apartment and even be hired for a job.
Getting your credit score used to be something of a hassle but these sites have made credit scores readily available to all of us.
5. Credit Karma
It’s easy to sign up for Credit Karma, just a quick, three-step process to create your account, give them some information that will allow them to provide you with your credit score, and verify your identity.
The score you see is a VantageScore 3.0 which the three leading credit reporting agencies, TransUnion, Equifax, and Experian, worked together to develop.
Most lenders will look at your FICO score, but the VantageScore is close enough to be sufficient to know how good or bad your credit score is. Scores are as follows:
Excellent: 750 and up
Bad: 550 and lower
Credit Karma offers more than just your credit score. They also provide your credit report. Based on your score, the site will give you credit card recommendations which are essential. Each time you apply for a credit card, your credit score takes a hit. It’s a small hit and temporary but it’s still a hit.
By seeing what cards you are more likely to be approved for, you reduce the risk of being rejected and taking a ding to your score for nothing.
Credit Karma also offers federal and state tax filing and credit monitoring which is something we should all take advantage of given how many data breaches are happening.
And the best part? All of these things are absolutely free with Credit Karma!
Quizzle uses the VantageScore 3.0 as Credit Karma does and also offers credit monitoring and your credit report.
There are often errors in credit reports which can negatively affect your credit score. If you see an error on your report, Quizzle will help you dispute it.
Quizzle is free to use.
Paying Off Debt
If you have debt, you know how stressful it can be. Getting a little help can take at least some of the stress out of paying off that debt.
Unbury.me is a loan calculator that can help you make a plan to pay off your debt.
You enter the details of each debt you owe, and you will see an overview of each one including the total in interest you will pay when you make only the minimum monthly payment.
You can play around with the numbers and see how much in interest you will save and how much more quickly your debt will be paid when you change the monthly payment amount.
Unbury.me lets you choose between the avalanche and snowball method of debt repayment.
Avalanche means you pay down the debt with the highest rate of interest first by putting every dollar you can towards that debt while paying only the monthly minimums on any other debts.
Once the first debt is entirely paid, you use the money you were paying on it and put it towards the debt with the next highest interest rate while continuing to pay only the minimums on the rest.
You continue this until all the debts are paid.
The advantage to the avalanche method of debt repayment is that by paying off the debt with the highest interest rate first, you save money because the higher the interest rate and the longer it takes you to pay it off, the more expensive the debt.
The snowball method means you pay the debt that has the lowest dollar amount first. Interest rates don’t matter.
You pay all that you can on the smallest debt while paying only the minimums on the others. You then proceed just as you did in the avalanche method.
Using the money you no longer need to pay off the first debt to pay the second and so on until all the debts are paid.
The benefit of the snowball method is a faster feeling of accomplishment.
By paying off smaller debts first, you feel like you are making real progress in paying down your debt and you can use that feeling as motivation to work even harder at paying off the rest.
Which method is better? The one that you will stick with! Although strictly from a money standpoint, the avalanche method is better because it saves you the most money.
Unbury.me isn’t going to force you to pay your debts, no one can do that except maybe a loan shark or the IRS.
But it does give you visuals with charts and graphs so you can see just how much money you are throwing away on interest when you don’t work at paying off debt as hard as you should be.
And seeing how much you can save when you change the monthly payment amounts is very motivating.
Unbury.me is free to use and a convenient place to keep track of all your debts and see the progress you are making towards paying them off.
Undebt.it is very similar to Unbury.me. It will help you make a plan to pay off your debt using the avalanche method, snowball method or a custom method that you design yourself.
But it has an additional feature that will help you make a plan to increase your credit score.
If you’ve had a lot of debt for a long time or have made late payments, your credit score might be in the basement so rebuilding it is a priority.
Undebt.it is free to use but they have a Premium Plan for just $12 a year that has some premium features like bill management, the 52-week savings challenge, text message payment reminders and more.
We could all stand to save more money, and these apps can help you to do it.
Qapital is a mobile banking app, but it is not a bank. It works similarly to Acorns, the investing app. Within Qapital, you set goals for yourself like paying off a credit card or saving for a wedding.
When you make a purchase on a linked debit card, Qapital will round up to the nearest $2.
So if you buy a coffee for $1.50, Qaptial will deposit 0.50 to your account with them which is held in an FDIC insured account
The Qapital banking app allows you to set goals and the rules that will trigger transfers from your connected bank account into your Qapital account.
The destination account is an FDIC-insured account held by Qapital at Wells Fargo Bank.
You can “trigger” deposits too using “If This, Then That.” If you do something like Pin something on your Pinterest Board, a deposit will be triggered to your Qapital account.
You can also deposit money the regular way by scheduling them daily, weekly, or monthly.
You can “reward” yourself with a transfer to your Qaptial account for things like working out, “punish” yourself with a transfer when you go out to dinner, or “congratulate” yourself for spending less than you usually do at the grocery store with a transfer.
It really is a lot of fun to set up all of your savings Triggers, and it’s not very often you can say that saving money is fun.
Qapital is free to use, and there is no minimum balance, usage fee, or monthly fee.
Rize is an automated savings app similar to Qapital. It’s one of the newer micro saving apps and has made a big splash because it is the first one that pays interest on the money you save with them.
And not a bad interest rate either at 1.43% at the time of this writing which is more than a lot of the big banks pay. (We’re not claiming that 1.43% is a reasonable interest rate for an investment but for a savings account, it’s up there!).
You can set goals for your savings, as many as you like. You can set up monthly transfers from your checking account into your Rize account, and you can use two other features to save even more.
The Accelerate feature will automatically increase the amount you save each month by 1%. At the end of 12 months, you will have increased your savings by 12%. If you got a 12% raise you would be pretty happy so this is a great feature.
The Boost feature gives you small savings “boosts.” Rize monitors your linked checking account and looks for spare change. It will transfer up to $5 or 5% of your monthly savings goal once or twice a week.
Currently, Rize lets you pay what you want for the service. You can give them ever how much a month you think is fair for the service, including paying nothing. There is no account minimum.
Take Charge of Your Money
Of course at Frugal For Less, we want you to take control of your money, but it shouldn’t take over your life, stress you out, or take hours out of your day.
Whether you need to make a budget, start investing for the future, keep an eye on your credit score, pay off debt, or save money, there is a tool out there to help make it easier.