Budgeting apps are coming up with new technological advantages that can track your budget easily without having to maintain any daily journal. But is a budgeting application completely necessary? Can we still rely on the traditional methods of budgeting or evolve with new methods of budgeting? Let us explore all these questions briefly.
Why Did Budgeting Apps Come into Being?
Whether the person is working in a corporate office or is a householder, budgeting is an essential task for both of them. In traditional times, keeping a separate accounts book for writing down the expenses and income was quite tiresome.
A budgeting tool mainly collects the financial information about an individual user and clearly shows the daily spending as well as analyses expense patterns. In simple terms, budgeting software is a digital tool that plans, forecasts, and tracks daily or monthly budgets.
There was no fixed time when budgeting apps came into existence. Budgeting activities were tiresome, thus to reduce the burden and automate budgeting, these apps were discovered. According to a market survey, almost 73% of people have been using a budgeting tool for calculating their budget and tracking their finances.
Let us now understand how a budgeting app is different from an expense tracker app.
Expense tracking or budgeting apps: Which is the better choice?
Expense tracker apps are often thought to be the same as budgeting tools, although that is not always the case.
Difference in functions
An expense-tracking app is primarily used for budget analysis, tracking, and keeping a focus on expenditures. On the other hand, budget software is built for tracking and keeping an online record of both income and expenditures. Moreover, a budget app saves a history of all the income as well as expenditures thoroughly, which is not provided by an expense app.
The spending pattern is different from the budget pattern
Spending pattern is identified from the budget pattern in many ways, such as the goal of an expense tracking app is to detect the pattern of high spending in a particular month.
In comparison to that, a budget pattern means identifying the nature of earning, and spending and categorizing every transaction compared to previous month expenditures.
Time point
Expense tracking tools are often used after making an expense, while a budgeting app is used even before the expense is made. The time point is crucial here, as using a budgeting instrument covers both the past and future of a transaction, while an expense tracking tool is limited only to a past transaction.
For example, if we spend £20 today, the expense tracking app will record this duly, although that is different from budgeting software. The budget tool will not only record this expense of £20 but also will provide suggestions for next-day spending and available budget for the future.
In a conclusive remark, an expense tracker app is highly limited when compared with a budget app.
Benefits of using a budgeting app
The reason for such high growth in using a budgeting app is that a budgeting device provides a large set of benefits:
- Most people look to calculate their loan period and analyse monthly finance. A budgeting tool directly gives a bird’s eye view of the loan amount, its maturity amount, and the time remaining to repay it.
- Get a snapshot of the stock market
- Plan a long-term finance
- Traditional budgeting needed the use of paper, modern budgeting is paperless
- Be alert for excessive spending and bills that are still due
- Includes an expense tracking tool
- Save all payment history in cloud storage for future use, even if the application gets accidentally uninstalled
- Automatically identify the nature of a transaction, which otherwise would be ambiguous to identify by a human
A budget when not organised and kept within consideration, can cause financial distress to a large extent. It is needless to say always taking notes and screenshots of every online transaction is very impractical, as well as highly unconventional.
The best budgeting app in the UK first analyses the total income categorises the expenditures in an organized manner and shows the leftover balance with predictions of future financial condition.
Future of budgeting apps in the UK
The United Kingdom (UK) comes in top ranking if the need for budgeting software is considered, given the background of the nation in leading financial services.
According to UK governmental data, almost 1.1 million people are working in the UK financial sector, as the financial sector contributes £278 billion to the national income. Budget application requirement is higher in the UK as the country is rapidly progressing in fintech, as the giant estimation of the whole fintech industry is almost $13.4 billion with 76,000 new jobs.
Given that just 14% of UK customers are actively using a budgeting app, and the fintech industry of the UK is rapidly growing, the future of budgeting tools is bright.
These days, a smart chatbot is being integrated with the best budgeting apps in the UK. These chatbots answer user questions in a very human way which clearly shows that budgeting apps are evolving. In addition to this, the use of artificial intelligence for detecting investment patterns is a major upgrade in modern-day budgeting tools. Many budgeting apps can also compare the subscription costs of different services and give detailed information about the best subscription service to choose from.
Conclusion
We have discussed the entire scenario of the best budgeting apps in the UK, their use, their benefits, and how the future of budgeting is slowly evolving.
Figgwealth is an advanced AI-powered budget planning application, and you can check out more about it on the official website.
