If you asked me for one tip on how to improve your finances, I’d probably suggest that you opened a Monzo account. Without a doubt, introducing this little coral card into my payday routine has helped me save more money than ever.
Monzo has been around for about 5 years now, although I only caught onto it in 2017. The bright design, the snazzy app and the fact that there was a huge waiting list to join, lured me in instantly. Little did I know back then that this card would revolutionise the way I managed my finances. It started off as a prepaid card, but has now transitioned into a full bank account. This means you can now receive your salary, withdraw cash, pay your bills and set up direct debits/ standing orders. They describe themselves as “a bank that makes things easier, not harder” – a statement I 100% believe to be true.
So, what are my favourite features?
1. Set budgets and track your spending
When I first started taking note of my finances, I would open my online banking, download my spending into an excel spreadsheet and analyse how I’d spent my money over the last month. I had a figure in my head of how much I should be spending in each area, which I’d then compare to my actual spending. I got into quite a good routine with this, but always wished there was an easier way.
Then along came Monzo (possible sequel to Along Came Polly?) With Monzo you can track your spending throughout the month and compare directly to the targets you have set for specific categories. Not only does this make tracking your spending easier, its pretty much eliminated the need for long-winded spreadsheets!
As an example, say I have set myself a budget of £150 for eating out this month. Every time I spend money at a restaurant, the cost of the meal is categorised under a “eating out” category. The app can then work out if I’m likely to spend more than my original target, based on how far through the month we are. This helps me identify where I’m likely to over spend, and where I then need to cut back.
2. Pay your friends
When I go out for dinner with my friends, we often arrange for one person to pay for the whole meal. We then agree to pay that person back as soon as we get home. But, it’s common that we’ll forget to pay them. Or we can’t remember how much we owe them. Or we go to pay them before realising we don’t know where our card reader is. Paying your friends back can become such a faff.
With Monzo, sending money to your friends couldn’t be any simpler. Even if they aren’t a Monzo user. There’s a payment section at the bottom of the app which links your bank account to your phone contacts. Simply click on their name to send them their money, and voila it’s done. There’s also a section that you can send money by regular bank transfer – again it’s super simple and only takes a few minutes.
3. Split bills
If you’ve finally convinced all your friends that getting a Monzo card is #essential then this is a feature you’ll love! There is a section on the app called Shared Tabs, which works by adding your friends to a group. Any time someone pays for something that you are included in, they can add this cost to the shared tab. The amount can be split evenly between everyone, or amended to reflect who owed what.
I went to Greece with three friends and we set up a shared tab. Every time we ate out, or got a round of drinks in one of us would pay. We would then add the amount (say £40) into the shared tab and it would show that three of us owed £10 to the person that originally paid. At the end of the holiday you can settle the tab, and feel confident that everyone has paid their way.
4. Save your spare change
If you need a little push to save money then this feature is excellent. Set up the spare change feature on Monzo and every time you spend, the cost of the transaction will be rounded up to the nearest pound and added into a savings pot. If your morning coffee costs you £1.70, 30p will be added to your savings.
How much money you save will obviously depend on how often you use your Monzo card, but this can be a great way of saving without even realising it!
5. Saving pots
That leads me nicely onto the fact that Monzo has a variety of ways you can save through their saving pots. These are a separate section of the app that you can transfer money into. You can have multiple saving pots set up for a variety of different things – for example a holiday savings pot, a wedding pot, a car pot etc.
There are different settings which allow you to either access the money in this pot at short notice, or lock them. You can also add your own image to the pot, I.e. a picture of the beach holiday you’re saving up for, that can be great for motivation!
Because Monzo is a mobile app, there is of course the feature of getting notified every time you spend. You can choose to opt in for notifications about news and updates, transactions and payments or lending promotions. One of the best things about notifications is if you have an upcoming payment due and there isn’t enough money in your account. They’ll let you know in advance so you can fix the issue before missing any payments.
7. You can use abroad
Some of the more traditional banks cost huge amounts of money to use abroad. Monzo has super low fees, and lets you withdraw £200 for free every 30 days. Other than where it is more cost effective to use cash, I will always use my Monzo card when I’m holidaying abroad!
If you’re struggling with saving, or managing your money, then Monzo may be the perfect card for you. Check out their website, blog, Facebook group or Instagram account for more information!