CARD SHARP
The best free bank budgeting tools that you already have on your phone
Laura Whateley explains some of the features to look out for
BUDGETING apps are a great way to help you stay on top of your finances.
From counting the pennies to stopping you paying too much for subscriptions, your phone can make it much easier to track spending and take some of the pain out of saving.
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But lots of apps now charge a monthly fee.
Before you pay, check out what is on offer from your bank.
Many high-street banks, and digital rivals such as Monzo and Starling, have useful tools attached to free accounts for no extra cost.
Laura Whateley explains some of the features to look out for . . .
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USE JAM-JAR SAVINGS POTS
“DIGITAL savings pots are a popular budgeting feature and a really useful way to organise your money and achieve specific goals,” says Amelia Murray, deputy editor of personal finance website Be Clever With Your Cash.
Think of them as mini savings accounts, or “digital jam jars” attached to your main current account that you can label as you choose.
It is much harder to keep an eye on where your money goes if all of your income is kept in one current account.
You can move cash into savings pots easily so there is less temptation to spend it.
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Some banks even allow you to lock them, to add a barrier so that you don’t accidentally dip into the funds.
“You can set up lots of different pots to save for the things you want or need,” explains Murray.
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Banks that offer savings pots with their free accounts include Monzo, Starling, Kroo, TSB and Chase.
You can even earn impressive interest on digital savings pots.
The best rate is from Kroo, at 4.35 per cent.
VIRTUAL DEBIT CARDS WITH SAVINGS POTS
SOME banks let you pay directly from your savings pots, which can help you to stick to a budget.
For example, Starling Bank has a bills manager feature where you can set up direct debits for things like your energy or broadband from a specific “saving space”.
The bank says this can help you to spot price rises more easily, as the payments are not buried among other current account transactions.
You can have up to five virtual debit cards with Starling and add them to your Apple or Google Wallet, to tap and pay directly from a space.
For example, you might transfer your rent directly to a landlord from your housing costs pot.
Or, set aside a certain amount into a “Starbucks” pot and use it every time you buy a latte.
ROUND-UP FEATURE
AS it has become far less common to carry cash, we don’t save as much spare change into a piggy bank at home.
Luckily, you can recreate this habit virtually now, with 11 banks including NatWest, Halifax, Lloyds and Nationwide offering a “round-up” function.
This works so that every time you use your debit card, the transaction is rounded up to the nearest pound and the difference is moved into a separate savings account.
The idea is that you save without really noticing.
For example, if you were to buy a sandwich costing £3.50, your card would be charged £4 and 50p would be moved into savings.
Some banks allow you to adjust the percentage of round-ups, to nudge you into saving even more.
TRACK SPENDING HABITS
TOO few of us keep a note of exactly where each pound goes, making it tricky to spot overspending.
Categorising your spending is a step toward knowing where most temptation lies.
Out of 32 banks surveyed by Defaqto, 18 let you do this, but only four — Virgin Money, Lloyds, Monzo and Starling — allow you to create your own categories.
MONITOR SUBSCRIPTION PAYMENTS
So much of what we buy is now on subscription.
And many of us have signed up for a service when there’s a free trial, only to forget about it and get hit with unexpected charges.
Ten banking apps let you view upcoming payments, including direct debits or standing orders.
GET PAYMENT ALERTS
THERE are also payment alerts to notify you when your balance falls below a certain limit, or when payments go in or out.
Make sure you enable alerts in your app.
“This is also a swift way to bring fraudulent transactions to your attention,” says Ms Murray.
“And, it can prevent you from being charged for going into your overdraft.”
BLOCK GAMBLING OR OVERSPENDING
MOST high-street banks including Lloyds, NatWest and Santander let you block gambling transactions on your phone or cards.
You can do this either via the app or by calling or visiting a branch.
Since Monzo introduced this feature in 2018, more than 700,000 customers have used it.
Some banks such as Barclays let you choose other retailers to block, too.
ADJUST YOUR CONTACTLESS LIMIT
THE contactless limit is now £100 a day — but research has shown that the easier it is to pay for something, the more likely we are to make a regrettable impulse purchase.
Sometimes, we don’t even notice how much money we are being charged.
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Most banks, including Barclays, Lloyds, Nationwide and Santander, let you set the daily contactless limit at a lower level.
This may also protect you against someone else using your card and spending large amounts of money.
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