best budgeting apps

Best Budgeting Apps in Canada – Monthly Budgets and Personal Finance

If you are like most people, you may be wondering how to budget your money, especially in this time of higher interest rates and persistent inflation. We believe that having a monthly budget is an important part of healthy personal finances.

Modern technology has made having a budget easier than ever. In particular, smartphone apps are available to seamlessly record your spending and allow you to know what to expect next month. Let’s take a look at some of the best budgeting apps in Canada.

Why is Having a Budget Important?

If you are trying to manage money without a budget you are bound to make some financial mistakes. Not having a budget is like trying to find something in the dark. You may have some idea of where you are but there is a good chance you could take a wrong turn or bump your knee.

In contrast, when you have a realistic budget and access to your spending data, it is more like a clear sunny day. You can see things very well and quickly, enabling you to make better decisions.

We often notice famous people claiming to have financial difficulties. People like movie stars, singers or NHL professional hockey players. How can this be? They are making millions of dollars! Clearly, they do not have a functioning budget. They are simply spending more than they are making. This is called having a deficit. Eventually, even having a small monthly deficit will require you to have too much debt no matter how much income you make each month.

Having a good, functioning budget will help you avoid the dreaded deficit months.

How to Start a Budget

Thankfully, having a functioning budget is available to all of us. You do not need to have a PHD in Economics. In fact, even a plain piece of paper and some type of budget template is a great place to start and even kind of a fun thing to do.

Do you know how much you spent on groceries last month? This is often an expense item that is underestimated. Having a realistic budget requires you to track your spending for a month or two. This is where budgeting apps are quite helpful as they automatically track for you as the month progresses. If you don’t track your expenses then you are likely to have an unrealistic budget for the future months which is of little use.

In any event, if you want to start right now, here is what to do with a pen and paper or on a spreadsheet:

  • Monthly income – start with your monthly income. Write down only the amount that you are sure to have. It is better to underestimate this amount.
  • Fixed expenses – these are cash outflows that don’t change each month such as rent or truck loan.
  • Variable expenses – identify those expenses that you often have but tend to change from month to month like vehicle gas or coffee at Timmies.
  • Annual expenses – these can be the tough ones. Expenses that happen only once per year or randomly can be difficult to budget. How do you budget for when your cat gets sick? It is still a good idea to make an estimate and divide by twelve.

This will give you a very rough budget that may not be realistic. However, it can identify some areas that surprise you. Especially if you are buying several coffees a day!

It will be interesting to look back at this rough budget that you started with once you have some more accurate information.

Budgeting Apps

There is no shortage of budgeting software that can help you; from a smartphone app to an excel budget template to your online banking, there are lots of different ways to get the data that you need.

With the fast paced life of today, a budgeting app may be the most convenient. Most apps will interface directly with your bank account or credit card so that every time there is a transaction the app will do its thing and put the expense into the correct category.

This gives you the opportunity to simply review the budgeting app data the next time you are stuck waiting in a ferry lineup or some other sort of delay.

Here are some budgeting apps that we think are worth your time to review:

  1. YNAB – this stands for ‘You Need a Budget’ which is quite an appropriate name if you are struggling with money.
  2. Mint – one of the more popular Canadian budgeting apps, Mint is a free budget app and is used by millions of people
  4. Bank apps – every bank in Canada has an app and online platform that will let you track your spending.

Some of these are free and some come with a monthly cost after a period of time. We are reluctant to recommend one over the other. Rather, we recommend that you spend a bit of time doing your own research and see what appeals to you.

Maybe even try each one for a short period of time. There is typically no initial charge for trying an app.

Budgeting Tips

Now that you are underway, we would like to offer a few budgeting tips to help you fight back against today’s increased cost of living.

  • Increase your income – with a part time job or side hustle
  • Decrease your expenses – pack a lunch instead of eating out
  • Buy things used instead of new whenever you can
  • Get a prepaid credit card instead of a regular credit card
  • Find free things to do for fun

Contact Us – We are Here to Help

Having a working monthly budget is a big part of having good finances. However, what if it is too late in the sense that you already have an overwhelming debt load. If that is the case for you, please contact us to discuss what options are available.

The Federal Government has authorized Licensed Insolvency Trustees (that is us!) with the authority to help you reorganize your finances by using either a Consumer Proposal or a Bankruptcy filing to provide you with a fresh start.

Once you have that fresh financial start, a budget or a budgeting app, can help make sure that you stay on a good financial path. By making the decision to contact us you are more than halfway to a better financial future!

Len Hiquebran, CPA, CA, LIT

After completing my articling at a local accounting firm, I spent some time working in industry as a controller of a logging company. Subsequently, I joined Derek L. Chase & Associates Ltd. in 2017 and began working in the insolvency field. In June 2020 I completed my studies and was granted a license by the Federal Government to be a Licensed Insolvency Trustee.