It's on your list of things to do and one of your New Year's resolutions. You want to save more, spend less and finally get your budget in a happy place. But a financial study found that two-thirds of Americans don't have $1,000 set aside to cover an emergency or an unexpected cost.
Perhaps you're coordinating a new move, taking on extra roommates (and can finally save extra money on rent!) or simply want to increase the amount you're putting away in investments. Or, maybe you just want to have $1,000 socked away. For whatever the reason, there are smart budgeting tools that can help you achieve your goals.
A Debt.com poll revealed that fewer Americans are budgeting, even though more than 90 percent of the 1,000 people surveyed believed that everyone should have one. If you're ready to join that club, you can use apps, a fancy software program or just a plain spreadsheet.
Budgeting comes down to setting the proper expectations with yourself. The heavy lifting comes from the commitment to come up with a plan and actually stick to it. Before diving into some of the best tools you can use, here are three tips:
Always remember you can always build upon your budgeting. Rome wasn't built in one day, so no one is expecting you to immediately ace your budget.
So, which apps are best for renters who need one? Check out the following and see which one best suits your needs.
Want to end your awkward money issues with your roommates? Try Splitwise.
If you live with roommates, you may have owed money to them or vice versa at some point. You want them to pay up, but don't want to constantly remind them that they still owe you for the grocery tab you picked up two weeks ago. Not only that, when you live with one or multiple roommates, sometimes it's hard to keep track of who paid for what, and what each person owes.
Splitwise can make your household a little more organized by helping you keep tabs on shared expenses and balances. It tallies up who paid for what and sends reminders at the end of the month to settle those debts. It has a balance sheet that includes all of the participants that need to pay up. You can create groups with various people, so a roommate group would come in handy.
You can easily calculate and pay each other back for informal debts like utilities, rent, shared meals, travel and everything in between. Payments can be made through PayPal or Venmo right from the app. If someone happens to pay you in cash, you can also record a cash payment and clear up the outstanding balance.
Mint is a budgeting tool that directly aggregates your financial accounts in one place. It helps you see and manage your money from your many different accounts, so you can track everything in one place. These include financial accounts such as:
Mint also provides you with your credit score and flags suspicious or large transactions.
While it's great to be able to see your accounts all in one place, Mint doesn't allow you to edit top-level categories yourself. Mint automatically categorizes your spending for you. Depending on who you ask, this may be negative, since it doesn't always do the best job of putting the right transactions in the proper spending categories.
However, you can always manually change them yourself. Mint remembers which transactions fall into these subcategories and automatically moves them into the proper buckets for you.
The best part about Mint is that it gives you a holistic picture of your money and lets you see what your general net worth is. You can also access it on your smartphone.
YNAB stands for You Need a Budget and has a cult-like following in the personal finance world. It lets you see transactions made from your bank accounts, but unlike Mint, you need to categorize them yourself.
According to YNAB's site, new budgeters save an average of $600 per month and more than $6,000 in their first year.
The company has four main pillars around its budgeting strategy to help you live within your means, pay off debt, save and stop living paycheck to paycheck.
Each dollar has a job, whether it's putting it towards rent or an emergency fund. This helps you feel like you're in control. You're the boss of your own money.
When most people think about their monthly expenses, they probably factor rent, utilities, car payments and student loans. But what about things like insurance premiums, birthday expenses and saving for vacations? YNAB encourages you to keep sight of these expenses and work them into your monthly budget.
Not everything will be perfect. YNAB encourages users to anticipate and adjust budgets for overspending in certain categories every now and then.
This rule may take a few months of runway to get to, but YNAB wants budgeters to strive for spending money you earned in the previous month.
YNAB also offers an envelope-based system, which is a budgeting strategy that helps you really reign in your spending and saving through putting your buckets of spending for the month as cash into specific envelopes. For example, you could allocate $30 a month for entertainment, as opposed to the usual $100 you spend on your credit cards.
Like Mint, YNAB also syncs with your desktop and has a smartphone app.
Can you recall the last time you paid for something and wondered if you had enough to cover it? If it happens more than you'd like to admit, you may like PocketGuard.
The app is designed to help you track your spending and saving and lower your expenses. That means getting a better handle on your spending, and learning how to spend less in accordance with your budget throughout the month.
PocketGuard can monitor things like unauthorized charges, hidden fees, billing mistakes and even that magazine subscription you forgot you signed up for. It links all of your financial accounts in one place and is useful if you want more clarity when it comes to income vs spending.
A nice perk about PocketGuard is their bill monitoring feature, which looks at your recurring bills within the month, such as your cell phone, TV and internet. It lets you know if there's a better deal you can take advantage of so you can save a little extra.
You can easily sync transactions to your budget, create a savings goal and see how much you have left to spend. It's a great way to take the guesswork out of your budget each month so you never have to wonder, “Wait a second … do I have enough to buy this?"
Personal Capital analyzes your various broker accounts to see what's helping and hurting you. You can keep track of your budgets, bank accounts and credit card accounts to see how much you're spending and where. Like the other budgeting tools, you can use Personal Capital to customize and track your budget.
Unlike Mint, Personal Capital guides you through your investment strategy with things like the fee analyzer, which shows if you're paying too much in fees. It also provides you with asset allocation, which refers to the different kinds of investments you have.
A solid asset allocation strategy means your portfolio is diversified and tailored to:
Personal Capital is a good way to see all of your financial accounts in one dashboard while giving you a deeper dive into your investment accounts as well. It's perfect for people who want to budget but also want to keep on top of how their investments are performing.
Being financially savvy has never been easier thanks to free budget tools and apps. Regardless of what your needs are, these great budgeting tools can help you take charge of your finances so you can make better decisions in the future.
Claire Tak is a writer who previously served as head of content and chief editor for FinTech companies in New York and San Francisco. Her work has appeared on FOX Business, Bloomberg and Forbes. She writes regularly about travel, money and being a good human. Traveling and snowboarding are her two favorite things to do.
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