Katherine Garcia had a life-changing experience in 2016. Her mom had lost her job, and the now 29-year-old was faced with the prospect of having to provide financial support to a parent.
“That was a blessing in disguise, because it made me look under the hood of my finances and realize that I had to get rid of [my] debt,” says Garcia, a Los Angeles-based digital marketing manager with the marketing agency Web Marketing Therapy. Her debt totaled $55,000 and spanned four credit cards and three student loans. That’s when Garcia turned to technology to pay off what she owed. She downloaded several apps until she found the right one.
“Mint was the only one that stuck and worked for me,” she says. While Mint is an app some people use for budgeting, it appealed to Garcia for a different reason: “All I cared about was my net worth and seeing the debt gone.”
By tracking her net worth on Mint and finding accountability in Facebook budgeting groups devoted to the financial philosophy of money guru Dave Ramsey, Garcia made her last debt payment in July. Her story is just one example of how millennials are using technology to better manage their money and meet financial goals.
Here are seven types of tools and services that win over millennials and make it easy for them to track their finances, apply for loans and save money.
Budgeting tools. When it comes to financial tools, most young adults could use help managing their spending and padding their savings, says Jake Serfas, a millennial and the lead financial strategist with the financial firm O’Dell, Winkfield, Roseman & Shipp in Baltimore.
“Most of them are just living for today,” Serfas says. However, budgeting apps and tools put access to account information at your fingertips and can encourage better financial decisions. Best of all for budget-minded young adults, most apps, including Mint, have a free version available.
Personal Capital is one financial service that is popular among money-savvy young adults. It offers both a website and app where users can not only track their cash flow, but also monitor retirement funds, watch their net worth and generate reports to review their spending habits. Wally is another option to consider. Though not as robust as Personal Capital, it may be a good fit for those who simply want to monitor their spending and aren’t as concerned with net worth and investments.
Peer-to-peer payment platforms. Kathy Doyle Thomas, chief strategy officer for Half Price Books in Dallas, is the mother to three millennials with the same favorite financial app: Venmo.
As a peer-to-peer, or P2P, payment service, Venmo lets people send money to one another and split bills even if they aren’t carrying cash. “Venmo is a great app that lets me keep track of what I owe and what friends owe me,” explains Thomas’s 24-year-old daughter Kristen.
Venmo is popular among millennials, but it’s not their only option. PayPal, which bought Venmo in 2014, gained popularity thanks to its convenient method for paying for auctions on eBay; now it too has its own P2P payment app. And Zelle, backed by a network of banks such as Chase and Bank of America, launched last year, becoming one of the newest competitors in the market. What’s more, Google and Apple have recently added P2P features to each of their respective Google Pay and Apple Pay apps.
Micro-investing and savings apps. These apps are perfect for young adults who know they should be saving but aren’t doing so, says Gretchen Caldwell, a wealth advisor with financial firm EP Wealth Advisors, LLC, in Lafayette, California.
The app Acorns rounds up the price of everyday purchases and invests the change for a fee that can be as little as $1 per month. Users can also make regular deposits and earn money toward their investment account when they make purchases from partnering retailers.
Meanwhile, Qapital and Digit are two apps that put savings on autopilot. “[Digit] is perfect for the millennial who can’t figure out why they aren’t saving more money,” Caldwell says. The service analyzes bank account data to determine how much you can reasonably save and then transfers that money automatically to a linked savings account. Qapital lets users create rules, like rounding up all purchases or depositing money at regular intervals, and automatically transfers money to savings that way.
Another savings app, Twine, is intended for couples who want to save toward a common goal. The app is offered by the investment firm John Hancock, and offers options to either save or invest money.
Credit and account monitoring. There are several apps that allow millennials to easily track bank account balances and credit scores.
For instance, the message service Charlie lets users link their bank accounts and then send questions about their finances, like, “What is my account balance?” Then, answers are quickly messaged back by the platform’s mascot, an AI-driven penguin character named Charlie. Capital One offers a similar service, Eno, for its account holders.
CreditWise, also from Capital One, offers credit monitoring of TransUnion credit reports. The app alerts users to changes on the TransUnion report and also provides access to a VantageScore 3.0 credit score. Even better, the service is free, and you don’t have to be a Capital One customer to use it.
Robo advisors. Millennials may not have enough money to justify hiring a financial planner, but they can receive affordable investment advice through a robo advisor. The services use algorithms to make investment recommendations. “I think they are good to an extent when you’re getting started,” Serfas says.
Betterment and Ellevest are two robo advisors that have no minimum balance requirement, making them good options for cash-strapped millennials. Betterment charges an annual fee of 0.25 percent for its basic account. Meanwhile, Ellevest, which is geared toward women, has the same fee for its lowest tier service.
Digital loan and insurance applications. Who has time to fill out paper applications? Not millennials who would rather punch in information on a website or app than have to schedule a face-to-face appointment with a loan officer. Fortunately, a variety of financial products now have digital applications.
Ethos provides term life insurance in every state except New York, as well as quotes online. Another company, AutoGravity, lets you find a vehicle and apply for financing, all on its website or app. The online lending and banking company Laurel Road provides refinancing for student loans, personal loans and more through its website.
And when you’re ready to buy a home, the mortgage lender PNC offers a Home Insight Planner that provides guidance on how much real estate a person’s income can comfortably afford and then connects visitors to a loan officer. A separate service, LoanSnap, analyzes all financial information, not just interest rates, to recommend the right mortgage loan.
Other money-saving apps. While there are lots of ways to cut costs and maximize savings, you may find using an app or digital service to be the most convenient option. For example, Second Look from Capital One enables users to review credit card transactions to pinpoint mistakes, likes duplicate charges.
Another app dedicated to saving cash is Clarity Money, which works across banking institutions. “Clarity is fantastic for helping you find subscription services you’ve signed up for,” Caldwell says. It scans statements to notify users of recurring charges, which can help people determine if they are paying for services they no longer use.
