One of the most important aspects of having a healthy relationship with money is to use an effective online budgeting app. But unfortunately, most of us are never taught budgeting in school, which can make people feel like budgeting is a goal that is out of reach.

However, thanks to modern technology, the abilities to budget are right in your hand! Now that smartphones and apps are commonplace, there are plenty of online budgeting apps to help you start building your future. But how do budgeting apps work? How can they help you with your personal finances? What are some things to consider when selecting a budgeting app? Read more to find out!

What Is An Online Budgeting App?

Budgeting apps are smartphone, tablet, or desktop applications designed to help you manage your money. They are designed to be easy to use so that the average person with no previous budgeting experience can quickly learn how to budget. In addition, many have customizable options, so you can put together a budget that suits you. Not all apps are made the same, so it’s a great idea to test them out to find the best that fits your needs.

How Budgeting Apps Work

How any particular budgeting app works is up to the app designer. Some budgeting apps work by syncing with your bank, credit card, and loan accounts, so the app can automatically track your finances. Others allow you to track your transactions without having to connect directly to your accounts. Also, some budgeting apps give you the option to do more than track by planning for your future with a well-planned outline for future incomes and expenses.

The setup may feel like a hassle, but it more than makes up for itself by taking the guesswork out of managing your money well. Instead of you tediously inputting every expense into a spreadsheet, your online budgeting app lets you track any transaction. We’ve been there reworking spreadsheets to account for changes in financial obligations or to make money appear out of thin air by reworking the budget. It’s such a grueling process that has been overcome with the right budgeting app. Or, for those who struggle to remember things like what you bought last week and when bills are due, budgeting apps can be a real game-changer.

What Can An Online Budgeting App Help You Do?

Budgeting apps can help you do a lot of things, including but not limited to:

  • Get a clear picture of your financial situation
    The first step to reaching any financial goal is to understand what your financial situation is. While this could be accomplished with a spreadsheet or accounting software, there is a fairly steep learning curve to accounting software. Plus, you’ll need to manually input all your financial data, which can create accounting errors if data entry is not your forte. Budgeting apps are a lot easier to use because, after the initial account information entry, the app can automatically track income and spending or give you the option to import your transactions.
  • Create awareness around your financial habits
    It’s easy to lose money unconsciously through impulse spending. Online budgeting apps can help you see where money tends to “leak out” of your budget. For example, maybe you’re a smoker looking for motivation to quit. A budgeting app can show you exactly how much money goes up in smoke, which can be a great reason to stop!
  • Identify spending patterns that need to change
    Once you have financial awareness, it’s easy to identify what can be changed. For example, perhaps you didn’t realize how much you were spending on takeout, and it’s already past time to start cooking. So plan ahead with a meal plan and include the expense in your budget. For work, try investing in a thermos to bring a hot meal to work. You may have a handful of subscriptions that could be canceled to keep more money in your pocket.
  • Create actionable steps towards reaching financial goals
    The most crucial thing online budgeting apps can do is ultimately help you achieve your financial goals. You may consider buying real estate or other income-generating assets that may seem like pie-in-the-sky ideas, but with an online budgeting app, you can make some adjustments to your financial plan and start saving for a down payment. Some apps can be set up to set money aside automatically, so you don’t even have to think about it!

Things To Consider When Choosing An Online Budgeting App

There are many budgeting apps to choose from. Here are a few key factors to consider when selecting an app to help you budget.

Device Compatibility

Not all apps work on all devices. So before you get your heart set on any budgeting app, make sure it’s compatible with your device. You can check device compatibility by searching the App Store (for iOS) or Google Play (for Android.)


Some budgeting apps are free to use, and some have a monthly subscription. If the app has a monthly subscription, see if there’s a free trial before committing to a subscription. You don’t want an unused subscription eating holes in your budget!

Be aware that some free apps contain ads. Some apps operate on the “freemium” model, which offers a limited version of the app for free, and a better, ad-free version to subscribers. You may find the few apps that provide a full access free trial to get your hands in there and see what you can really do with your budget to achieve your goals and dreams.

Ease Of Use

Most apps work by synching to your various accounts, but some require manually inputting all of your transactions. While some users prefer this with fewer security risks, it also has a lot more room for human error. 

Most budgeting app users prefer apps that synch to accounts because they eliminate what is often the most challenging part of budgeting, remembering all the little things you spend money on. Apps that automatically track your income and expenses make the process of creating and sticking to a budget much easier to do.

If you choose to update your budget manually, you can avoid relying on any shorter memory issues by recording your transactions in your budget on your device as they happen.

Options to Customize Spending Categories

Most budgeting apps will have the basics: housing, food, transportation, etc. Some have customizable spending categories, so if you have a pet or a hobby you would like to account for in your budget, you can do so. With customizable budgets, you can see the big picture more easily to know where you can alter your spending patterns to increase your savings.

See the Big Picture

Most budgeting apps will track your current transactions of what is coming in and going out of your accounts. Knowing where you are now financially gives you a great starting point to identify what is going well and what you can improve on. Use your past transactions to find any unnecessary expenses that could have been avoided, like late fees, overdraft fees, interest payments, or impulse buys.

A nice bonus is the ability to forecast your future with expected transactions planned into the future according to past spending patterns and known future transactions. As you then look forward to the next few months and years, you can identify potential financial challenges and plan wisely for emergencies and other bigger purchases like buying a vehicle or home or paying debt down faster.

Bottom Line

Budgeting apps are easy to use and can help you get on top of your finances by tracking your income and spending. With a bit of financial awareness, you can start making steps towards reaching your financial goals. So what are you waiting for? Sign up for a 30-Day free trial with CalendarBudget to track and plan for the future of your financial well-being.