5 Best Budgeting Apps for UK Savers & Budgeting Tips for 2024 (2024)

1. Best for Investors - Starling Bank

The Starling Bank Account is the best budgeting account for investors owing to its seamless integration of investment accounts and its comprehensive range of features.

Users can easily link their investment accounts within the app and have a consolidated view of their financial portfolio. In this way, you can easily monitor and manage your investments alongside your everyday banking activities, offering convenience and a holistic approach to financial management.

The app notifies you instantly of any investment-related transactions, allowing you to monitor your investment performance and make timely decisions based on the most current information.

2. Best for Payday Budgeting - Monzo Account

Monzo is an innovative digital bank offering a feature-rich budgeting app, thereby, making it the best choice for payday budgeting. It is designed to assist users in managing their finances around their payday.

The app also provides features such as a salary sorter and early payday access to help you budget and allocate your income efficiently. With Monzo, you can plan your expenses and set aside money for bills, savings, and other financial goals as soon as you get paid.

This bank gives real-time transaction updates, ensuring that you've got an up-to-date view of your spending. Upon making any transaction, you get hold of instantaneous notifications for your mobile device. This characteristic lets you live in your price range and make informed spending decisions in actual time.

3. Best for Spending Analytics - Revolut Account

Revolut is a digital banking app, known for its compelling features and user-friendly interface. It stands out in its advanced spending analytics, personalised insights, and budgeting tools.

All these features provide a comprehensive view of your financial habits, hence, empowering you to make informed decisions and achieve your budgeting goals.

In addition to its budgeting features, the platform offers extra add-ons that enhance the banking experience and may include fee-free international spending, currency exchange at interbank rates, and budgeting challenges tailored for frequent travellers.

4. Best for Multiple Card Owners - Chase Account

The Chase Bank Account is the best budgeting account for multiple card owners, owing to the platform’s comprehensive features and user-friendly interface..

The app works like a centralised platform for tracking spendings across all linked cards. With Chase, you can easily view individual card transactions and have a holistic view of your financial activity.

Moreover, the app provides real-time updates and lets you monitor your expenses closely and make timely adjustments.

5. Best for Expense Categorisation - Monese

Monese Bank Account offers an easy operable interface; hence, acts as the best budgeting account for expense categorisation. It saves users’ time and effort while allowing a personalised approach to budget tracking.

In addition to its expense categorisation features, the app offers various extra features including mobile check deposits, international money transfers, in-app card controls, and foreign exchange payments.

For those who prioritise correct spending categorisation, the Monese Bank Account is their best call.

6. Best for Family and Friends - Money Dashboard

Money Dashboard is an online financial management and budgeting app, available free of cost.

The platform helps users successfully keep track of their spending habits. Money Dashboard collaborates with most UK banks and other financial suppliers to provide this service.

Users can also link multiple bank accounts and credit cards, to have a a consolidated view of all of their finances for all family members or friends involved under a single roof. This feature is essential for collaborative budgeting, enabling everyone to track their accounts and shared expenses in one place.

Why You Should Use a Budgeting App?

A budgeting app offers several benefits, a few of which are listed below:

• It gives you the ability to recognise your spending patterns, organize your expenses into categories, and decide where to spend more or less.

• It also aids in the development of bespoke budgets depending on your income and outgoings.

Do Budgeting Apps Cost Anything?

Yes, budgeting apps do cost some amount. There are some apps offering free versions, while others charge a fee or require a subscription to access more advanced functions. The following is a list of typical price range that budgeting apps impose:

How to Handle Physical Cash In Budgeting Apps?

When real money is incorporated into budgeting software, there are several ways to monitor and control cash transactions. The following are some tips for using real money in budgeting apps:

• Manual Entry: Most budgeting apps, like YNAB and Starling Bank, let users manually enter transactions, making it easy to track actual cash transactions. Users can input the amount spent, the category of the expense, and any additional transaction-related remarks.

• Cash Accounts: Users may create separate accounts to manage their physical currency. The app users can set up a cash account, much like setting up a bank account so that monetary transactions can be accurately tracked and classified. For example: Monzo Bank offers this feature.

• Receipt Scanning: Some budgeting apps, like Money Dashboard, provide receipt scanning features that are helpful for keeping track of physical cash transactions. Users can use optical character recognition (OCR) technology to scan a cash receipt and fetch the transaction information, including the date, retailer, and amount paid. The budgeting app may then automatically enter this data, eliminating the need for manual data entry.

Security Measures Budgeting Apps Must Have

Budgeting apps should prioritise the security of user data and financial information to ensure the protection of their users. Here are some standard security measures:

• Data Privacy: Budgeting apps should have clear privacy policies outlining how user data is collected, stored, and shared. They should adhere to applicable data protection regulations, such as the General Data Protection Regulation (GDPR) in the European Union, and obtain user consent for data collection and processing.

• FCA Regulation: While budgeting apps may not be directly regulated by the Financial Conduct Authority (FCA); specific features, such as providing access to bank accounts or offering financial advice, may fall under FCA regulation.

• FSCS Protection: The Financial Services Compensation Scheme (FSCS) is a UK government-backed scheme that protects customers of authorised financial services firms. Budgeting apps themselves may not be covered by FSCS protection. Still, if they facilitate transactions with FCA-regulated banks or institutions, the funds in those accounts may be eligible for FSCS protection.

Why Is Budgeting So Crucial?

Budgeting is important for individuals to manage their finances. Here are a few key motives why budgeting is so vital:

• Spending Control: Budgeting allows you to manage your spending. It helps you prioritise your needs based on your profits and economic goals.

  See Also

  10 Best Free Budgeting Apps UK [Updated 2023]

• Saving and Investing: Budgeting is important for building savings and investments. It helps you allocate your income toward savings for future needs.

• Financial Flexibility: Budgeting provides economic balance and flexibility. It facilitates you to plan your expenses, reducing economic strain and the need to depend on credit cards or loans for emergencies.

Without any doubt, budgeting is a stepping stone towards constructing wealth and attaining monetary freedom. It is a top-of-the-line concept that enables you to make the most of your resources and develop your wealth through the years.

How to Create a Budget?

Financial Planning is a practical and powerful way to control your budget. One famous budgeting technique is the 50/30/20 finances, which enables allocating your profits into needs, wants, and financial savings.

Here's a step-by-step guide on a way to create a finance plan:

Remember, while the 50/30/20 budgeting method is popular, it may only work for some. Adjust the percentages based on your individual needs and financial goals.

The Three Main Budget Categories

When creating a budget, it's essential to categorise your expenses to manage your income effectively. The three main budget categories are needs, wants, and savings/debt. Let's explore each category and illustrate them using an example of a £4,000 monthly income:

1. Needs (50%)

The needs category includes essential expenses that are necessary for daily living. It's recommended to allocate approximately 50% of your income to this category.

For instance, consider earning £4,000 monthly income:

50% of £4,000 = £2,000

In this scenario, £2,000 would be allocated towards covering essential needs such as Rent/mortgage, utilities, groceries, transportation, and healthcare.

2. Wants (30%)

These costs go toward your quality of life and personal preferences even though they are not necessary for survival. You should allocate 30% of your salary to this category, according to the advice.

Using a £4,000 monthly income as an example:

30% of £4,000 = £1,200

In this instance, £1,200 will be set aside for interests, hobbies, and recreational pursuits.

3. Savings and Loans (20%)

This area focuses on accumulating funds, eliminating debt, and setting up for upcoming financial objectives. You should put roughly 20% of your salary into this category, according to the advice.

Using a £4,000 monthly income as an example:

20% of £4,000 = £800

In this instance, £800 will be split between loans and savings, including loan repayments, early cash advances, and saves.

However, it’s crucial to remember that these percentages are only basic recommendations that can be changed depending on a person's unique situation and preferences.

Budgeting Vs. Saving

Saving and budgeting are two ideas linked to personal finances, although they differ significantly and have different goals.

Budgeting:

Making a budget is about planning how you will distribute your money and control your spending. You can manage your finances, make informed decisions, and prioritise your spending by using a budget.

Saving:

Setting money aside from your wages for future use or to reach specified financial goals is defined as saving. It can be done by placing cash apart in a savings account or other investment options to build a monetary safety net, fund huge purchases, or fulfill long-term goals.

Differences between Budgeting and Savings

• Focus: While saving focuses on setting money aside for the future, budgeting is largely focused on planning your income and controlling your expenses in the present.

• Allocation: Budgeting is mainly about planning and tracking your expenses based on your income whereas saving is setting away money expressly for saving goals.

• Timeframe: Saving can be an ongoing process that lasts for months, years, or even decades, but budgeting is often done monthly or annually.

Similarities between Budgeting and Savings

• Financial Discipline: Budgeting and saving both call for self-control and dedication to sound money management.

• Goal-Oriented: Whether it's debt repayment, accumulating an emergency fund, or saving for a down payment, both of these approaches include working towards specific financial goals.

• Financial Control: Making a budget and setting money aside, both help you take charge of your finances and make deliberate choices regarding how you spend your money.

To sum up, budgeting and saving play a vital role in a person's financial development.

Strategies for Amplifying Budgeting and Saving

• Specify your financial goals, such as consolidating debt, saving for a down payment on a house, or setting up an emergency fund.

• Track your income and expenses frequently, and classify them to gain a better understanding of your spending patterns and potential areas for savings.

• Develop a budget that takes into account both your income and your financial goals.

• Speak with a financial advisor to help you make the most of your spending and saving strategies and get customised guidance based on your financial goals and circ*mstances.

Using a Budgeting App for Saving Goals

Budgeting apps can be helpful tools for assisting people in conserving money successfully and efficiently. Here are some tips on how to use budgeting apps to help you save money:

• Establish Specific Savings Goals: Set savings objectives in the budgeting software. Enter the precise target amount and the preferred time frame for accomplishing the goal, whether it's a vacation, a down payment, or an emergency fund.

• Create a category for savings: Create a specific category or account in the budgeting program for your savings objective. This enables you to monitor your progress in addition to other expenses and determine how close you are to your goal.

• Track Progress: Within the budgeting tool, keep track of how well you're doing at saving money. The software can show you how close you are to achieving your goal visually via graphs or progress bars.

These applications offer a practical and accessible platform for managing and tracking progress, which makes it simpler to meet desired savings goals.

How to Stop Going Over Your Budget?

Sticking to a budget can be challenging, but there are several strategies that individuals can implement to manage their expenses. Here are some actionable tips to help you stay within your budget:

• Track and Review Your Expenses.

• Create Realistic Budget Categories.

• Practice Mindful Spending.

• Before making non-essential purchases, give yourself a 24-hour waiting period.

• Stay Accountable

Why Do Budgets Fail?

Budgets can fail for several reasons and it's essential to be aware of the common pitfalls that individuals may encounter. Here are some reasons why budgets fail:

• Lack of Realistic Planning: Budgets may only succeed based on realistic expectations and goals. If the budget accurately reflects your income, expenses, and financial situation, it becomes easier to stick to it.

• Failure to Track Expenses: One of the critical components of budgeting is tracking your expenses consistently. You need to record and monitor your spending to understand where your money is flowing.

• Lack of Emergency Fund: Not having an emergency fund can be a significant reason for budget failure. With a financial safety net, unexpected expenses can prevent individuals from relying on credit cards or loans, disrupting their budget and potentially leading to debt.

• Impulse Spending and Emotional Triggers: Budgets can fail when individuals give in to impulsive purchases driven by emotions or instant gratification. Emotional triggers, such as stress, boredom, or peer pressure, can lead to overspending and deviating from the planned budget.

Free or Subscription-Based Budgeting App?

Some budgeting apps are paid while some offer their features completely free. Highlighted below are some of the free or paid apps with their charges for accessible features.

Best Free Budgeting Apps

Here are three popular free budgeting apps, along with their ratings on the App Store and Google Play:

Best Paid Budgeting Apps

Here are three popular paid budgeting apps, along with their costs information:

Budgeting through a Bank

Here are three banking apps with budgeting features and associated costs:

Who Will Use the Budgeting App with You?