Best Budgeting Apps in the UK

Updated: Oct 12, 2021
Best Budgeting Apps UK

Contents:

Best Budgeting Apps

We've compiled a list of some of the best budgeting and money management apps in the UK. These are manual and open banking budgeting apps that help you track your spending, categorise your expenses and cancel wasteful subscriptions.

All the open banking budgeting apps listed here are available on Android and iOS and regulated by the Financial Conduct Authority (FCA).

Compare some of the best budgeting apps in the UK below:


Money Dashboard - Spending plan; Forecasted cash flows; Reminders

Money Dashboard Logo
Cost
Free
Green Check Mark
Connect Bank Accounts

Money Dashboard is a personal finance and budgeting app that keeps track of your spending and lets you view all your accounts in one place. It connects to your accounts in minutes and manages all of your transactions in one place, which means you can track your online current accounts, savings accounts, credit cards, and crypto wallets at once. Money Dashboard also has a Spending Plan tool that encourages effective money management through forecasted cashflows. By deducting your upcoming bills from your balance at any time, you’ll know exactly how much money you have left to spend or save.

Money Dashboard is available on the web, iOS and Android.

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Budget by Koody - Analytics; Forecasted cash flows; Reminders

Koody logo in blue
Cost
Free
Red Cross Mark
Connect Bank Accounts

Budget by Koody is a money management and budgeting app that offers a simple and personalised approach to keeping you on track with your finances, giving you complete control to account for your expenses and monitor your spending habits over time. The app is an excellent alternative for those who want to enjoy all the perks of a modern budgeting app without connecting their bank accounts. You can set budgets, categorise your spending and keep track of your cash transactions, current accounts, savings accounts, investment accounts, credit cards and crypto wallets, all without linking your accounts. Budget by Koody will also give you a continually updated overview of your monthly spending, with a reminder of your upcoming expenses, total monthly budget and daily spending limit to keep you within your budget.

Budget by Koody is available on the web, iOS and Android.

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Cleo - Spending analysis; Auto-saving; Smart chatbot

Cleo Logo
Cost
Free
Green Check Mark
Connect Bank Accounts

Cleo is a fun budgeting and automatic savings app that provides personalised budgets, spending breakdowns, budgeting tips and help with bills. The app also has a smart chatbot that helps you manage your finances in an entertaining way. The 'Roast Me' feature is particularly comical. The app turns red when you switch to roast mode, and Cleo begins to help you identify poor spending patterns and recommend ways to improve them. If you find finance, budgeting and saving money boring, this app might just change your mind forever.

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Plum - Spending analysis; Expenses categorisation; Auto-saving

Plum Logo
Cost
Free
Green Check Mark
Connect Bank Accounts

Plum is a money management app that builds a complete picture of your finances to save you money and help you budget. The app shows you an overview of your finances and analyses your spending to help you keep track of your money. Plum also automates your deposits and investments and automatically switches your utilities. It's free to download the Plum app, set money aside using automatic deposits and Round Ups, withdraw as often as you like, and switch your bills with Plum. If you're interested in automatic investments or want to earn interest on your savings, Plum Plus or Plum Pro might be for you.

Plum Plus: £1/month (first month free)
‍Plum Pro: £2.99/month (first month free)

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Snoop - Spending categorisation & summaries; Discount code finder

Snoop logo
Cost
Free
Green Check Mark
Connect Bank Accounts

Snoop is a money management app that allows you to see all your bank accounts together in one place, categorise your spending, receive daily spending alerts and view weekly and monthly spending summaries. Snoop has an exciting discount code finder that shares money-saving voucher codes for the places you already spend money at, so if there's a saving to be had, it's yours if you want it. Snoop will also help you reduce bills such as your energy, broadband, mortgage and mobile bills.

Other Snoop features include energy switching, insurance checker, card checker and payment hub. Visit Snoop to learn more about all their amazing features.

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Monese - Spending analysis; Expenses categorisation; Savings pots

Monese Logo
Cost
Free
Red Cross Mark
Connect Bank Accounts

Monese has a host of personal finance offerings, including a budgeting tool and expense tracker. With Monese, you can set weekly or monthly budgets, categorise your spending, open separate savings pots, move money around and receive detailed transaction alerts and instant notifications whenever you make a purchase. Monese also has other features such as multi-currency accounts, local payments, international money transfers and travel money.

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Emma - Spending tracker; Expenses categorisation; Reminders

Emma Logo
Cost
Free
Green Check Mark
Connect Bank Accounts

Emma is a money management app that automatically categorises your expenses to help set budgets, cancel wasteful subscriptions, and save you money in the long run. Emma analyses your finances in one place, giving you a clearer insight into your spending behaviour, as well as a host of tools to help you make smarter decisions with your money. With Emma, you can track your bank accounts, savings and investments, credit cards, cryptocurrencies, and pensions in one place. Emma will also sync your personal budgets to your pay period and use the ‘Emma reports’ feature to let you know if you’re on track or if you need to slow down your spending.

You can upgrade to Emma Pro for £9.99 a month (or £59.99 a year) to access more advanced features.

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Monzo - Spending analysis; Expenses categorisation

Monzo logo
Cost
Free
Green Check Mark
Connect Bank Accounts

Monzo Bank is not a budgeting app per se, but it has put a lot of work into building a great budgeting and money management offering. It allows you to categorise your spending, view detailed spending reports, move money around, and open separate savings pots.

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Yolt - Spending analysis; Payment reminders

Yolt logo
Cost
Free
Green Check Mark
Connect Bank Accounts

Yolt is a personal finance and budgeting app that allows you to connect all your bank accounts and view them together in one place. You also get access to payment reminders, personalised insights into your spending and detailed breakdowns of your outgoings.

Note: Yolt budgeting app has shut down - learn more.

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What is a budget

A budget is a financial plan for your income and expenses over a particular period of time.


Consider the following example - suppose your net monthly income (after tax and national insurance contributions) is £2,000. You need to ensure that at the end of each month, you have spent less than £2,000 as spending more could lead to severe financial and mental health problems.


A budget helps you make a spending plan for that £2,000. A plan that ensures you never run out of money before your next payday. If you do it right, you might even have some money left over for long-term saving and investing.


How to create a budget

There are many ways to create a budget. For example, if you have your own method of estimating your income and expenses, making a plan to keep your costs below your income, paying your debt when due and saving a little for the future, you already have a budget.


At Koody, we recommend using the 50-30-20 budget rule. It's a brilliant budgeting technique that suggests spending 50% of your income on your needs, 30% on wants and 20% on savings and extra debt.


Let's continue with the £2,000 net monthly income example we used above. Using the 50-30-20 budget rule, you allocate £1,000 to your needs, £600 to your wants and £400 to your savings and extra debt. 


To make it easy for you to understand, we have included a simple budget calculator below. Use the budget calculator to quickly estimate how much of your monthly income to allocate to needs, wants and savings.


Budget Calculator 

Net Monthly Income
Input your net monthly income (after tax and national insurance contributions).
£


Needs (50%) 🏠 🚘 🧾
£
Wants (30%) 🍺 🛍 👠
£
Savings (20%) 💰 💸 🤑
£

The 50-30-20 budget rule helps you categorise your spending and make long term plans for savings and investing, but it does not work in every circumstance. There are situations where you need to be a bit flexible with the rule, and it makes perfect sense to adjust the ratios to suit your needs.


For instance, if you are struggling with debt and can barely afford to meet your monthly repayment obligations, allocating 30% of your income to wants and 20% to savings and extra debt might not work for you. 


Consider your own financial situation before deciding on what budget rule to use. 


A budgeting app that tracks, categorises, and analyses your spending could help you better understand how much to allocate to wants, needs and savings.

Most of these budgeting apps are entirely free to download and use. Additionally, many banks now offer a spending tracking and categorisation feature on current accounts free of charge.


The three main budget categories

The three main budget categories are needs, wants and savings.


Needs (50%)

These are things you cannot do without - your absolute necessities, such as:

  1. Groceries
  2. Essential clothing
  3. Mortgage payments
  4. Rent
  5. Car payments
  6. Utilities - energy, water, broadband, phone bill and TV licence
  7. Transportation
  8. Healthcare and Insurance
  9. Childcare
  10. Minimum loan payments. Anything above the minimum should go into the savings and extra debt category.

Using the 50-30-20 budget rule, allocate 50% of your income to your needs.


Wants (30%)

These are the extra things you spend money on that make life more enjoyable, such as:

  1. Dinner and drinks out
  2. New handbag
  3. Organising a party
  4. Travel
  5. Gym membership
  6. Tickets to sporting events
  7. Latest gadget
  8. Shopping


Using the 50-30-20 budget rule, allocate 30% of your income to your wants. 


Since our wants make life more enjoyable, it's important to spend money on them. But be careful not to spend too much. Allocating 30% of your net income to your wants is just about reasonable. And, depending on your personal circumstance, 30% might even be too much. 


Savings and debt (20%)

This category is all about planning for the future. There are two critical future events to plan for:

  1. Emergencies 
  2. Long-term goals, e.g., retirement, wedding or house deposit


If there's anything we've learnt from the Coronavirus pandemic, it is that emergencies happen, and it pays to be prepared. 


At Koody, we strongly recommend building an emergency fund to cater to unforeseen financial shocks like a job loss, major health issue or massive car repair.


Your emergency fund should be equal to at least three month's living expenses. This would serve as a buffer preventing you from making poor financial decisions in a time of crisis. You can start by allocating 10% of your net income to your emergency fund. Read more about building an emergency fund here.


The second category under Savings and Debt is long-term goals. We all have long-term goals. For some, it could be living comfortably in retirement. For others, it could be buying a home or getting married. Whatever your goals, without adequate planning, you might struggle to achieve them.


Allocate the remaining 10% of your net income to saving towards your long-term goals and overpaying your debts (if you think it's necessary to do so). 


Read our Investing for Beginners guide to learn more about investing and financial planning for your future.

How to stop going over your budget

  1. Set SMART goals: Set SMART (Specific, Measurable, Achievable, Realistic, and Timely) goals and plan for each month of the year. There's no point in planning to save 70% of your income next month if you've never saved up 20% before. A rule of thumb is to start small, then increase your savings goals each month. For example, if you save 10% this month, you can try 11% next month, 12% the following month and so on.
  2. Open a separate savings account for each budget category: There are three main budget categories - needs, wants and savings. Opening a separate savings account or pot for each category will help you better track your spending. For example, you can open an ISA (tax-free savings account) for your savings and a standard savings or current account for your needs and wants. Banks like Monzo, Starling and Barclays allow you to create virtual savings pots within your existing account, so you don't have to go through the hassle of opening multiple accounts. This method of budgeting is called the envelope budgeting method.
  3. Set up a standing order for each payday: If you have different savings accounts for each budget category, use your bank app to set up a standing order to move money from your current account to your savings account every payday. This way, you are allocating money to all three budget categories immediately after you receive your salary. If you have an investment account, you should consider setting up a direct debit to automate transfers to your investment account too.
  4. Automate the entire budgeting process: Spreadsheets are lovely and might provide some value. Yet, many people fail to stick to their budgets because they can be time-consuming and strenuous to create and manage. If spreadsheets work for you, that's fine. If they don't, use smart manual budgeting apps (if you don't want to connect your bank account) or open banking budgeting apps that connect to your bank account, so you never have to worry about manipulating a spreadsheet. Before you connect an app or service to your bank account, double-check that it is regulated by the FCA. All the open banking budgeting apps listed on Koody are regulated by the FCA.
  5. Pay off expensive debts: It can be challenging to stick to your budget if you are heavily indebted. Consider paying off expensive debts as quickly as possible, so you can focus on building a realistic budget and financial plan.
  6. Build an emergency fund: An emergency fund is money you set aside to cover unexpected financial shocks like a job loss, unexpected medical bills or major home and car repairs. An emergency fund is not for planned purchases like buying a new house, car, gadget or university tuition. At Koody, we recommend saving up an emergency fund equal to 3 - 6 months' worth of living expenses.
  7. Take the 1p savings challenge: The 1p savings challenge is a great way to cultivate a good saving habit. All you need to do is save one penny on day 1, 2p on day 2, 3p on day 3, and so on. After 365 days, you could end up saving over £650. Challenger banks like Monzo offer the 1p challenge as a feature within their mobile banking apps. Check if your bank does too. 
  8. Keep track of your progress: If you use an automated service like a budgeting or money management app, it'll be easy to see if you are meeting your spending targets. Keeping track of your progress helps you stay in control of your budget.

1. Are budgeting apps safe?

Modern budgeting apps like Money Dashboard and Plum claim to use the same encryption technology as all major banks to protect your personal information. They don't store your banking credentials and can only access your data in read-only mode. This means that your account can't be breached, and the money in it can't be touched. These apps are also regulated by the FCA.


2. Is there an app that keeps track of your spending?

Most modern budgeting apps like Monese, Budget by Koody and Money Dashboard keep track of your spending to give you a clearer picture of your spending habits. Banks like Monzo and Starling also help you keep track of your spending.


3. How do I stop living paycheque to paycheque?

Here are our recommendations for the best ways to stop living paycheque to paycheque:

  1. Create a budget
  2. Reduce your spending
  3. Improve your skills
  4. Build an emergency fund
  5. Sell old items you no longer need
  6. Get a side hustle
  7. Stay away from payday loans

4. Why do budgets fail?

Here a few reasons why budgets fail:

  1. You set unrealistic goals
  2. Your budgeting tool is difficult to use and time-consuming
  3. You don't plan for ad hoc spending or emergencies
  4. You forget you have a budget
  5. Your expenses are higher than your income
  6. You are over-indebted

5. What is the best free budgeting app?

Here are some of the best free budgeting apps in the UK:

  1. Money Dashboard - Spending plan; Forecasted cash flows; Reminders
  2. Budget by Koody - Analytics; Forecasted cash flows; Reminders
  3. Cleo - Spending analysis; Auto-saving; Smart chatbot
  4. Plum - Spending analysis; Expenses categorisation; Auto-saving
  5. Monese - Spending analysis; Expenses categorisation; Savings pots
  6. Snoop - Spending categorisation and summaries; Discount code finder


You might also like 🤓

  1. Emma vs Money Dashboard
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  3. Curve vs Currensea
  4. Best Money Saving Apps
  5. Best Automatic Savings Apps
  6. Best Stocks and Shares ISA
  7. Best Investment Apps
  8. Compare Investment Platforms
  9. Compare Robo Advisors
  10. Investing for Beginners


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