5 Personal Finance Apps to Keep Your Finances in Check

May 5, 2017

In today’s tech-savvy environment, it doesn’t take much to find that there’s an app for everything. If you want to edit a photo to post on Instagram, read a book, or track your food or workouts, there’s likely an app for it. It is as simple as making a few taps on your smartphone. With 95% of Americans owning some kind of cellphone according to PEW Research Center, it doesn’t seem surprising that apps are becoming so easy to use. Apps help make everyday life a little bit easier. The same simplicity can apply to personal finance apps.

If you are an avid smartphone user, you may have noticed that your experience is getting significantly easier. Instead of driving to your nearest bank to deposit a check, you can now do so from your smartphone in a matter of minutes. Checking your balance and transferring funds are simpler than ever. Did you know, there are apps that help you stick to your budget, remind you to pay bills, and invest money? Read on for five personal finance apps that could help make your life easier:

Acorns™

Category: Investing

Cost: Free app install, $1 per month for the service

Best for: Wanting to make an extra buck

The idea behind Acorns™ is using your spare change to earn additional money. Essentially, this app is meant for investing, especially small amounts. You can start off by putting in just $5 and Acorns™ economists will invest your money into stocks and bonds for you. One major benefit to this app is it is mostly hands-off. There are three options for depositing money, which can all be done automatically:

Investments from your bank account (recurring or one-time)
Round up to the nearest dollar whenever you make a purchase on a debit or credit card (you will not see any money leave your credit or debit card until the round-ups reach $5)
“Earn Found Money” is where you receive money from purchases made with specific brands

Acorns™ will then invest your money into over 7,000 stocks in bonds, and when you earn dividends the app will reinvest those without you even needing to tell it to. The service does come at a cost: $1 per month. You can pay $2 per month to add on Acorns Later™, which is an IRA that saves for retirement. There is also the option to withdraw your money whenever you would like. Investing your spare change in Acorns™ will likely give you a higher return than just letting it sit in your wallet.

Do You Need a Financial Advisor to Start Investing?

Mint™

Category: Budgeting

Cost: Free

Best for: Keeping track of finances

Mint™ is one of the most popular finance apps, and it is totally free. The purpose of the app is to manage your money, plain and simple. Whether that includes investments, credit cards, bills, or budgeting, you can take a look at all of your finances all in one place. You can also keep track of your credit score and the app will give you tips as to how to make it better. Mint™ will notify you when you need to pay your bills and tell you what you owe so you won’t miss any payments. The app tracks your purchases to make sure you are not going over your set budget and will let you know if you are close to doing so. Mint™ comes from Intuit™, which also owns TurboTax™, so there is a strong level of safety involved. Get this app if you are looking for convenience and simplicity in managing your finances for no cost.

Honeydue™

Category: Budgeting

Cost: Free

Best for: Couples

This is an app that is made for couples. If you are in a relationship or married and have a hard time keeping up with finances with your partner, this is the app for you. It is designed to be collaborative, so both you and your partner are aware of bills and spending and can keep track of expenses. Custom categories can be created and then you set a monthly budget for each one. You can set bill reminders for just one person – that way you know for sure who is responsible for that bill. It doesn’t matter if you have a combined account or if your finances are completely separate because you can customize how much you share with each other. This app is sure to cut down on disagreements about finances between couples.

Personal Capital™

Category: Investing/Money Management

Cost: Free

Best for: Working on your net worth

Personal Capital™ is for investment and money management and tracking your net worth. The app pulls together all of your investments, loans, credit cards, and bank accounts and determines what your net worth is and whether you are investing in the right places and gives advice as to how to improve your portfolio. This is a free app and is run by financial advisors both human and automated. There are tools for budgeting as well, but the real strength in this app is in discovering and improving your net worth. You can also use the technology and advisors to plan for retirement.

You Need a Budget (YNAB) ™

Category: Investing/Money Management

Cost: Free app install, $6.99 per month after free trial for service

Best for: Getting out of debt

YNAB™ has been growing in popularity over the last few years and has the goal to get you out of debt. It is primarily a budgeting app, but it also gives you the tools to learn how to get out and stay out of debt. You Need a Budget lives by four rules:

Give every dollar a job: make sure you have budgeted for every dollar you get in income monthly
Embrace your true expenses: always include expenses that occur less frequently within your monthly budget
Roll with the punches: be aware that your budget will probably have to change – and be willing to make those changes
Age your money: this is just saying that you should be using last month’s paycheck to pay this month’s bills

YNAB™ is an effective app that many users swear by, but it does cost money. You will be charged $6.99 each month after a 34-day free trial. Use that free trial period to determine whether the guidance is worth the price.

Add Personal Finance Apps to Your List

According to PEW Research Center, 77% of Americans go online on a daily basis. Of those 77% of Americans, 43% of them go online multiple times a day. If you frequently use apps to make your life easier, why not add a few personal finance apps to your phone? The more you keep up with your finances, the more aware of them you will be. There are apps for sticking to your budget, tracking credit score, investing, fraud protection, and more, and these are just a few of the many personal finance apps out there.

Cards and Accounts That Pay You

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Education Loan Finance by SouthEast Bank is not responsible for and has no control over the subject matter, content, information, or graphics of the websites that have links here. The portal and news features are being provided by an outside source – The bank is not responsible for the content. Please contact us with any concerns or comments.

Give Experiences

It’s no secret the U.S. is a country of “stuff.” We fill our homes, garages, and eventually, storage units with items that we just know we’ll use again someday. While the newest iPhone® or New York Times® Bestseller might make your family and friend’s faces light up this December, once the next model comes out or the last page is read, those gifts become obsolete.

So instead of blowing your hard-earned income and monthly budget on more “stuff,” consider giving experiences: concert tickets, zoo memberships, or woodworking classes that your recipient will remember longer than they will the plot of that over-rated biopic. What’s even better: you can experience these things together. If you’re looking for more experiences to gift this holiday season, check out Huffington Post’s article, 21 Gift Ideas For People Who Value Experiences More Than Things. You can find a more holistic approach to experiential gift-giving for the mind, body, and soul in this ELFI blog.

Give Savings

While not the most glamorous gift, receiving a contribution towards your student loan debt really is the gift that keeps on giving. Helping put a dent in student loan debt is more thoughtful than cash or a gift card snagged while checking out at the grocery store, and it can help you pay off those student loans faster.

If your parents, grandparents or significant other made a student loan payment in your honor for the next two-three years for the holidays and your birthday, thousands of dollars could be shaved off of your student loans. Getting out from under student loan debt faster also means more fun money in your checking account to boost that monthly budget and buy the gifts you really want to give.

If you’re like the many students who took out multiple federal and private student loans over the course of college, it may be a good time to consolidate and refinance student loans into one singular loan. Besides possibly scoring a better repayment term and interest rate, seeing the family contributions to paying off the debt could really jumpstart your 2020 goal of getting more financially fit.

REgive Gifts

Re-gifting gets a bad wrap for being the lazy person’s way of shedding the unwanted junk in their house. However, with a little extra thought, re-gifting can be a fulfilling experience. Look past the junky toaster on your kitchen counter or clothes you hate and consider items that are in good condition, but no longer bring you joy or serve a purpose in your home. Maybe it’s an old CD that you and your dad listened to before you left for college. Maybe it’s an Instant Pot® that you really thought you’d use more of in 2017. Or maybe it’s a necklace your friend always compliments. Whatever it is, clean them up, wrap them nicely, and—whatever you do—be sure your friend or family member didn’t give you the item first. The secret to successfully re-gifting is to be upfront and honest about the gift being from your own personal department store and share why you did it.

Give Time

The holiday spirit is all about being with the ones you love and being generous to those in need. If you or your family are feeling stressed to maintain monthly budgets this year, consider scrapping gifting (in the traditional sense) altogether. There are countless organizations that take volunteers throughout the holiday season to distribute presents in hospitals, cook meals for the homeless, and even shovel snow or hang Christmas lights for the elderly. By giving time, you make connections in your community, spread cheer, and build karma for the new year.

If you’re still feeling stressed about ruining your perfectly planned monthly budget this holiday season, consider student loan refinancing. Recent graduates have reported saving an average of $309 every month after their student loan refinance with ELFI*, which averages out to $20,936 in total savings.¹ And because this is the busy time of year, you can see your potential savings and see if you are prequalified for a student loan refinance in minutes. Happiest of holidays to you and yours!

*Subject to credit approval. Terms and conditions apply.

¹Average savings calculations are based on information provided by SouthEast Bank/ Education Loan Finance customers who refinanced their student loans between 8/16/2016 and 10/25/2018. While these amounts represent reported average amounts saved, actual amounts saved will vary depending upon a number of factors.

Notice About Third Party Websites: Education Loan Finance by SouthEast Bank is not responsible for and has no control over the subject matter, content, information, or graphics of the websites that have links here. The portal and news features are being provided by an outside source – the bank is not responsible for the content. Please contact us with any concerns or comments.

2019-12-10

Student Loan Repayment: Debt Snowball vs. Debt Avalanche

By Kat Tretina

Kat Tretina is a freelance writer based in Orlando, Florida. Her work has been featured in publications like The Huffington Post, Entrepreneur, and more. She is focused on helping people pay down their debt and boost their income.

To cope with the high cost of college, you likely took out several different student loans. According to Saving For College, the average 2019 graduate left school with eight to 12 different student loans.

With so much debt and so many different individual loans, you may be overwhelmed and can’t decide where to start with your repayment. If you want to pay off your loans ahead of schedule, there are two main strategies that financial experts recommend: the debt avalanche and the debt snowball.

Here’s how each of these strategies work and how to decide which approach is right for you.

The difference between the debt snowball and debt avalanche strategies

Both the debt avalanche and debt snowball methods are strategies for paying off your debt early. However, how they work is quite different.

Debt avalanche

With the debt avalanche method, you list all of your student loans from the one with the highest interest rate to the one with the lowest interest rate. You continue making the minimum payments on all of your loans. However, you put any extra money you have toward the loan with the highest interest rate.

Under the debt avalanche, you keep making extra payments toward the debt with the highest interest rate. Once that loan is paid off, you roll over that loan’s monthly payment and pay it toward the loan with the next highest interest rate.

For example, let’s say you had the following loans:

$10,000 Private student loan at 7% interest
$15,000 Private student loan at 6.5% interest
$5,000 Direct Loan at 4.45% interest

In this scenario, you would make extra payments toward the private student loan at 7% interest first with the debt avalanche method. Once that loan was paid off, you’d make extra payments toward the private student loan at 6.5% interest, and then finally you’d tackle the Unsubsidized Direct Loan.

Debt snowball

The debt snowball method is more focused on quick wins. With this approach, you list all of your student loans according to their balance, rather than their interest rate. You continue making the minimum payments on all of them, but you put extra money toward the loan with the smallest balance first.

Once the smallest loan is paid off, you roll your payment toward the loan with the next lowest balance. You continue this process until all of your debt is paid off.

If you had the same loans as in the above example and followed the debt snowball method, you’d pay off the Direct Loan with the $5,000 balance first since it’s the smallest loan. Once that loan was paid off, you’d make extra payments toward the $10,000 private loan, and then you’d pay off the $15,000 private loan.

Pros and cons of the debt avalanche method

The debt avalanche strategy has several benefits and drawbacks:

Pros

You save more in interest: By tackling the highest-interest debt first, you’ll save more money in interest charges over the length of your loan. Compared to the debt snowball method, using the debt avalanche method can help you save hundreds or even thousands of dollars.
You’ll pay off the loans faster: Because you’re addressing the highest-interest debt first, there’s less time for interest to accrue on the loan. With less interest building, you can pay off your loans much earlier.

Cons

You don’t see results as quickly: Because you’re tackling the debt with the highest interest rate rather than the smallest balance, it can take longer before you can pay off a loan.
You may lose focus: It takes longer to pay off each loan, so it’s easier to lose motivation.

Pros and cons of the debt snowball method

The debt snowball method has the following pros and cons:

Pros

You get results quickly: Since you’re targeting the loan with the lowest balance first, you’ll pay off individual loans quicker than you would with the debt avalanche method.
Frees up money to pay down the next loan: You’ll be able to pay off loans quickly and roll the payments toward the next loan, helping you stay focused on your goals.

Cons

You’ll pay more in interest fees: By paying extra toward the loan with the smallest balance rather than the highest interest rate, you’ll pay more in interest fees than you would if you followed the debt avalanche method.
It could take longer to pay off your debt: Because you aren’t targeting the loans with the highest interest rate first, more interest can accrue over the length of the loan. The added interest means it will take longer to pay off your loans.

Which strategy is best for paying off student loans?

So which strategy is best for paying off student loans: the debt avalanche or the debt snowball? If your goal is to save as much money as possible and pay off your loans as quickly as you can, the debt avalanche method makes the most financial sense.

Psychologically, the debt snowball may have the advantage. According to a study from the Harvard Business Review, the debt snowball method is the most effective approach over the long-term, as borrowers are more likely to stick to their repayment strategy. However, which strategy is best for you is dependent on your mindset, motivation level, and your determination to pay off your debt.

Managing your student loan debt

Regardless of which repayment strategy you choose, you could save even more money or pay off your loans earlier by refinancing your student loans. When you refinance student loans, you apply for a loan from a private lender for the amount of your current student loans, including both private and federal loans.

The new loan has completely different repayment terms than your old ones, including interest rate, repayment term, and monthly payment. Even better, you’ll only have one student loan with one monthly payment to remember.

Use ELFI’s Find My Rate tool to get a rate quote without affecting your credit score.*

*Subject to credit approval. Terms and conditions apply.

2019-12-04

Tips for Starting Your Student Loan Repayment Journey

Once you graduate from college, leave college, or drop below half-time enrollment, it’s time to start thinking about when your student loan repayment period kicks in. Understanding the repayment process for your student loans is very important for a number of reasons – for one, if you don’t pay, your interest will accrue. Second, if you don’t pay, it will affect your credit score, which can hinder your ability to buy a home, buy a car, qualify for credit cards, take out a personal loan, or refinance your student loans. If you graduated this past spring, your student loan repayment period will likely start around this time of year (if they haven’t kicked in already). Follow these tips to master student loan repayment and get yourself to a strong financial start after college.

Know How to Access Your Loan Information

A good first step is to acquire your loan information. This can typically be accessed via an online login. Monitoring your loan information will be essential during the course of repayment. If you took out Federal Student Loans, you can likely access your info at https://myfedloan.org/. If you took out private student loans, check with your lender for how to access your information. Tracking your loans will give you a gage on the status of each loan, the balance you owe, as well as interest rates for each loan. By understanding the status of your loans, you can make more informed decisions about how you want to prioritize repayment, what type of repayment plan you want to choose, or even whether you want to consolidate or refinance your student loans.

Know When Your Payments Start

Immediately following graduation, you’ll likely have a grace period, or a period of time before your first payment is due. This can vary depending on the type of loan you have, and they can be different for each loan. Subsidized and Unsubsidized Federal loans have a six-month grace period. Perkins loans have a nine-month grace period. There is no grace period for PLUS loans; however, if you are a graduate or professional student PLUS borrower, you do not have to make any payments while you are enrolled at least half time and (for Direct PLUS loans first disbursed on or after July 1, 2008) for an additional 6 months after you graduate or drop below half-time enrollment. Private student loans will have differing grace periods so contact your loan servicer for more details. Knowing when your loan will be due is imperative to starting off on the right foot when it comes to your student loans.

Weigh Repayment Options

When you take out federal student loans and your grace period is complete, you will automatically enter the Standard Repayment Plan. This plan allows you to pay off your debt within 10 years, with the monthly payment remaining the same over the life of the loan. If standard repayment doesn’t work for your budget, you may want to consider some other options, or perhaps even refinance your student loans. The federal student loan program offers the following Income-Based Repayment plans:

Graduated Repayment Plan – Gives you a smaller payment amount in the beginning and gradually increases the payment amount every two years.
Extended Repayment Plan – Allows you to pay the least possible amount per month for 10 to 25 years.
Revised Pay As You Earn Repayment Plan or REPAYE Plan – Bases the monthly payment on you (and spouse’s) adjusted gross income, family size, and state of residence.
Pay As You Earn or PAYE – Monthly payments are based on your adjusted gross income and family size. You must be experiencing a financial hardship to qualify. You must also be considered a “new borrower” as of 10/1/2007 or after, or be someone who received an eligible Direct Loan disbursement on 10/1/2011 or after.
Income-Based Repayment or IBR – Monthly payments based on your adjusted gross income and family size. Must be experiencing a financial hardship to qualify.
Income-Contingent Repayment or ICR – Based on your monthly adjusted gross income and family size. Typically chosen if an individual can’t qualify for the Pay As You Earn Plan or Income-Based Repayment.Any changes to your income or your spouse’s income will affect your student loan payment. For example, if your salary increases, your student loan payment will as well. If you are married, both your income and your partner’s income are combined. Two combined incomes will increase your total income, likely increasing your monthly payment.

Keep in mind that each repayment option will have positives, negatives, as well as eligibility requirements. Research each option before making a decision, and consider contacting your loan servicer if you have questions or need more information.

Automate Your Payments (If you can)

Setting up automatic payments will make student loan repayment less of a hassle, will avoid late payments, and may even score you an interest rate reduction. Just be sure you have enough money in your account month-to-month to endure the payments without overdrawing.

Make Extra Payments

When you make your monthly payment, it will first apply to any late fees you have, then it will apply to interest. After these items are covered, the remaining payment will go toward your principal loan balance (the amount you actually borrowed). By paying down the principal, you reduce the amount of interest that you pay over the life of the loan. Applying extra income by making larger payments or double payments will reduce the total amount you’ll end up paying.

Reach Out for Help if Necessary

If you’re having trouble making your monthly payments, particularly on your federal student loans, contact your loan servicer. They will work with you to find a repayment plan you can manage or help determine your eligibility for deferment or forbearance. If you stop making payments without getting a deferment or forbearance, you risk your loan going into default, which can have serious consequences to your credit.

Weigh Refinancing & Consolidation Options

If you have multiple student loans that are all accruing interest at different rates, you may want to consider student loan refinancing or consolidation to make repayment more manageable. The federal student loan program offers student loan consolidation, in which they combine your loans into one loan with a weighted average interest rate, rounded up to the nearest 1/8th percent. You can also consolidate your federal and/or private student loan with a private lender through the process of refinancing. Refinancing your student loans is much like consolidation, however it offers the opportunity to start new repayment terms and possibly lower your interest rate. Keep in mind that refinancing with a private lender may cause you to lose access to certain federal student loan repayment options that are listed above.

Look Into Loan Forgiveness

If you work in a public service position or for a non-profit, you may want to consider the Public Service Loan Forgiveness program or another loan forgiveness program offered by the federal government. Other options exist for volunteers, military recruits, medical personnel, etc. Some state, school, and private programs also offer loan forgiveness. Check with your school or loan servicer to see if you may qualify for student loan forgiveness.

Earn Your Tax Benefits

If you are paying your student loans, you may be able to deduct the interest you pay on your student loans when filing your taxes. Deductions reduce your tax liability, saving you money and serving as a nice tradeoff for having to pay interest on your student loans. Repayment of student loans can be a long, difficult journey – but by taking advantage of your resources and staying determined to pay off your debt, it is manageable. If you need more information on paying back your student loans or the options that are available to you, contact your loan servicer.