Martin Lewis reveals how auto-saving mobile apps can save you thousands of pounds
31 January 2020, 16:49
The Money Saving Expert has revealed how the easy step can help you save a lot of money without even realising.
Martin Lewis is the go-to man for anything to do with finances, and his new tip is sure to help you put a few quid aside which will come in handy for a rainy day.
The 47-year-old has advised that people should look into auto-saving apps, which essentially put back a tiny bit of money without you realising - and it piles up!
The apps will use tech and data of your payments to work out how much you can afford to save and they'll then move the cash from your current account for you.
Martin, who spoke on Good Morning Britain yesterday, said: "The apps have an algorithm that looks at your bank account and sees how much money you can put aside, and automatically does it for you.
"There’s lots of these auto-savings apps coming out, people really like them and ask me ‘are they safe or not?’
"The answer is they’re good, but the interest isn’t that good and they’re relatively safe but not as safe as a savings account.
"So unless you've chosen to invest, you might be best off moving the cash to a normal savings account every few months".
If you're awful at getting into the habit of saving, they could be ideal for you.
There's a variety of apps which work in slightly different ways, it's best to look into them all to figure out what's best for you.
Tandem works by analysing your spending details through access to your bank account, and tells you how much you can afford to save.
As well as automatically moving money to savings for you, you can also make regular deposits and one-off ones.
It has a 0.5 per cent interest on your cash, which is low, but it is something!
Tandem is considered a fully regulated UK bank which means savings of up to £85k are completely protected by the Financial Services Compensation Scheme.
Moneybox works by rounding up all of your transactions, for example, if you paid £2.60 for a latte, the app would round it up to £3, and put that 40p in your savings.
The savings provider currently offers the top Lifetime Isa paying interest of 1.4 per cent and the company also offers a a 95-day notice account paying 1.65 per cent in interest.
With both accounts, you'll get the full £85,000 per person protection.
Plum's changed a lot since it first started out, as It was initially just some sort of chat bot in Facebook messenger.
Now it analyses what you can afford to put away every month and moves it to your Plum account, which doesn't offer interest on savings.
However, you can instead invest the money in stocks and shares, which is a bit of a gamble if you're not clued up, but can pay off if you invest wisely.
Chip is an app you give access to your bank account and it uses an algorithm to work out what you should be saving every four days.
Theres no interest available in the savings account so it can be worth moving the money collected every now and again.
One thing to bear in mind is that the money saved doesn't have the same protection as some others do, and you're at risk if Barclays Bank goes bust, as they money is held in a ring-fenced account with them.