Using a savings App

Just set up a direct debit into a savings account rather than paying high comission to a gimmicky system set up to fleece the unwary and naive.

Alexland wrote: »

I guess there is a market for people who are otherwise unable to put a suitable regular contribution into their savings and/or investment account. Personally I wouldn't use them as my brain is reasonably well developed in this area. In other aspects of life I am hopeless and apps might help.

I don't think there is, or at least only for people who are unable or unwilling to be anything more than prey to random spending impulses.
It really doesn't take much effort to work out what your regular spending is and what can be spent.
Apps like this work on the basis that you do your spending almost at random and then save what's left rather than make a rational decision what to save.
Peoplel who think they need something like this need to grow up and make some simple plans rather than hiding behind phrases such as "not good with money" or similar as if it's genetic and they are discussing abilty to to run the 100 metres in under 10 seconds rather than so soem simple adding up and subtraction no more difficult than they did in primary school.
The OPs already acknowledged they need to save. Which is a great first step. How much is a simple second one.,don't use an app like this which isa crutch that will handicap you by making it appear you can't make your own decisions.

The two aren't remotely analogous. Learning a second language requires memory and ability to understand verbal patterns. Saving just requires impulse control, which is something that any dog has.

Knowing that if you spend money now you won't be able to spend in the future does not require any sort of intellectual ability. Anyone who can dress themselves understands this. When someone says they're not good at saving, they mean they don't want to, or haven't in the past.

Plum sells itself as a magic solution that will build up a savings fund for you without you having to think about it. The problem is that to stop you noticing that you have less money to spend, it moves pennies. This doesn't work because when you put pennies in you get pennies out.

Malthusian wrote: »

Plum sells itself as a magic solution that will build up a savings fund for you without you having to think about it. The problem is that to stop you noticing that you have less money to spend, it moves pennies. This doesn't work because when you put pennies in you get pennies out.

Things like this can also encourage and embed bad financial habits in people. From Plum's website FAQ's:-

Q: I just moved a big amount of money into my account because I plan to buy an expensive flight in 2 weeks. Will Plum think that is money it can save? - A: No

For many of us the idea of leaving the money for an "expensive" flight sitting around in a current account for two weeks earning no interest would be an anathema. But with Plum this would appear to be the 'right' thing to do.

If I were going to allow tech to manage my money for me then I'd want it to know that I don't need to pay for the flight for another two weeks and leave the money earning interest until a day or so before it is actually needed.

To do that requires the tech to have a lot more knowledge and ability to predict than many people would be comfortable with. The tech protagonists would say that no system could know the flight didn't need to be paid for until two week's time (unless the user tells it).

Which makes the subsequent FAQ rather interesting:-

Q: I will get paid 5 days later this month.- A. Plum will radically reduce how much it will be saving for you as soon as you don’t get paid.

So the system is reactive, not proactive. Many people manage their money each month by spending until they have nothing left in their current account - if necessary cutting back in the last days before payday. If you know you won't get paid until 5 days later than normal you adjust your spending to make the money last for those extra 5 days. Technology which doesn't know that this month is different to other months cannot make adaptations until it has worked out that payday hasn't arrived. Which doesn't seem like a very good way of managing your money, and creates extra work for the user to 'undo' things the tech has done.

It seems to me that you already need to be quite good at managing your money to safely and conveniently allow tech to do it for you.

excelwizard wrote: »

Although I agree in principal yes, you can boil down that saving money is as simple as rationally knowing spending money now means you can't spend it later, in reality there are emotions involved and for some, controlling the impulse to spend requires quite a large lifestyle change and/or a change in their relationship to money.

Other way round. Lifestyle change requires impulse control. There is no Saving Fairy Godmother who will change your lifestyle by magic. It starts in the brain.