Lifestyle, Don’t have the discipline for saving? Let apps do the hard work and build your Isa for you, By using apps, you can build your Isa without even realising Picture Getty, by Press24 Uk, where many people are interested in watching and following the news,Don’t have the discipline for saving? Let apps do the hard work and build your Isa for you, and now to the details.
Don’t have the discipline for saving? Let apps do the hard...
By using apps, you can build your Isa without even realising (Picture: Getty)
Saving money into an Isa can seem daunting when there often is not enough left over at the end of the month. But clever apps and technology promise to help you build a nest egg without feeling the pinch, putting away tiny amounts each time.
Techniques such as ‘round-ups’, where the change from every pound you spend goes into a cash or stocks and shares Isa, as well as apps that take data from your bank account and siphon away spare money, can make saving a painless process, according to experts.
A recent study from the Open Banking group found that nearly 70 per cent of people using savings apps found it easier to save, with two thirds of users having increased the amount in their savings or investments.
Brian Byrnes, head of personal finance at Moneybox, one of the apps aimed at helping people save, says many customers start by using the round-up feature, which puts away tiny amounts, and then move on to making bigger savings.
‘It has been fantastic to see customers who start with round-ups growing in confidence, setting aside larger amounts of money and making progress towards their financial goals – whether that’s building a savings buffer or even buying their first home,’ he says.
For those who want to save or invest in an Isa using this technology, there are various apps to choose from, and all have different features, pros and cons.Moneybox (Picture: Shutterstock)
What does it do?Moneybox is an app offering savings and investments including several types of Isa. Its Lifetime Isa, a product that allows you to get a bonus from the government to top up savings for a first home or for retirement, is particularly popular. It also offers stocks and shares and Junior Isas.
How does it help you save? Features include round-ups, which the app says are very popular. If you link your bank card to the app, Moneybox will automatically save or invest the spare change from every one of your purchases, rounded up to the nearest pound.
The company says the average saver saves £500 a year with round-ups and that the feature frequently leads to users making further savings, too. ‘It helps to get over the savings hurdle,’ says Byrnes.
Other features include Payday Boost, where extra savings into your Isa or other account are automatically added on pay day.
What does it cost?Moneybox costs £1 a month and is free for the first three months. If you have investments, you are charged 0.45% of the value of your investments per year. The company takes this fee by selling some of the shares in your largest investment. You will also pay fees to fund providers.Plum (Picture: Shutterstock)
What does it do?Plum offers savings outside an Isa and a stocks and shares Isa or pension. The app monitors your spending if you link it to your current account and takes out money automatically to add to your chosen account.
How does it help you save?By monitoring all your banks and credit cards in one place, Plum reckons it can identify where and when you have spare money and can tuck it away in savings and investments.
It transfers your money into an instant access account that pays up to 2.9 per cent interest and then feeds it back as you need it for bills, gives you an overview of your spending and helps you to channel money into your investments.
Features include round-ups, as with Moneybox, as well as automatic payments on pay day. The app also allows you to turn on a Rainy Days feature, which means you automatically save more on days when it rains in your area.
What does it cost?Plum Basic is a free service and gives you access to the algorithm that automates your savings. Users can get two per cent interest on savings and you can also use round-ups and pay day features as well as buy stocks and shares.
By paying more, from £2.99 to £9.99 a month, you will get access to further features, including the ability to create separate accounts for different goals as well as higher savings rates.Beanstalk (Picture: Shutterstock)
What does it do?It lets you put cashback from your shopping online towards your children’s future in a Junior Isa. It now offers an Isa for adults, too.
How does it help you save?It has many of the features offered by the other apps, including round-ups and the option to make deposits whenever you want. Extra features include the ability to use the cashback you make if you shop online through KidStart as part of your savings pot. KidStart works in the same way as sites such as Quidco and TopCashback, paying you a percentage of the amount you spend with selected retailers. This money can go straight into a Beanstalk account or be split between several children on these accounts.
The site also makes it easy for relatives to help grow the pot – they can link their cashback savings to the accounts – and parents can set up gifting pages and links.
What does it cost? Beanstalk costs 0.5% of the value of any account every year, while the investment funds have annual charges deducted directly from the funds of 0.12-0.15%.Gabrielle Dalligan with her partner Dan and daughter Arriella (Picture: Susanna Wood)
‘I’ve always been a terrible saver and spent everything,’ says Gabrielle Dalligan, 34, from Surrey. ‘But when I opened an Isa with Plum and slowly saw it increasing, it felt as though I wasn’t even saving my own money.
‘The app knows which bills you have, because it links to your bank account and knows when they are due. It knows whether it can take a little bit of extra money one week and put it to one side. It does it in such a subtle way and that obviously then mounts up over time.’
Gabrielle used her initial savings pot to go towards her first home, and now she and her partner, Dan, are building up their savings again after the birth of baby Arriella, who is now ten months old. ‘I’ve £8,000 in savings already,’ says Gabrielle.
Some of the money she puts away is in savings and the rest is invested in a fund called Tech Giants, which includes companies including Facebook and Apple.
‘I’m no way a pro at investing. But I think I’ve now got quite a good understanding of how it works because of Plum,’ she says.
‘I’m now thinking about saving into a pension as well,’ adds Gabrielle, who works in a customer experience role for a property development company.
‘I’ve done a lot of temporary contracts through work and I’ve got pensions all over the place.
‘So I know that I need to consolidate those. It would be nice to have everything in one place.’
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