Smartphone, smart saver
While 66 per cent of millennials cherish and rely heavily on their mobile devices, that dependency isn't necessarily a bad thing. In fact, according to a recent BMO Bank of Montreal report, it's paying off financially.
"The Millennial generation is leading the charge in terms of adopting new technologies and integrating them into their everyday lives, and as a result, are relying on their mobile devices more than ever before to complete day to day tasks -- particularly when it comes to managing their finances," said Tatiana DaCosta, head of online and mobile banking Canada, BMO Financial Group.
There are some financial pros and cons to keep in mind when navigating mobile apps -- particularly if you, like 73 per cent of respondents, feel lost without your cell phone.
Knowledge is power
Since the survey participants began using a financial app, 88 per cent are now managing their finances more effectively.
Such is the case for Timothy Keslick, who regularly uses two mobile banking apps. "By being able to keep track of the money going in and out of my account, the apps help me see how much money needs to be saved to cover recurring costs, like phone payments, car payments and auto insurance, how much should be devoted to saving and where I can trim my spending on unnecessary variable expenses."
It's also helpful to be able to easily access banking information for the times when you're unable to get to a computer or a teller, he adds.
Christine White, a money coach with Money Coaches Canada, encourages her clients to use mobile apps. "Mobile apps, especially the banking ones, allow people to visually see their own real money in real time."
Be choosy with your apps
However, White recommends banking apps -- not budgeting apps. "They are based more on theory and tracking things spent in the past." And while financial apps, such as Mint are good increasing awareness about where your money went, she says they don't help very much with the behavioural component of making good spending choices in the future.
Think before you transfer
While mobile banking apps are a great organizational tool, sometimes they can make savings too accessible, says White. "We have clients separate their spending money from their short-term savings accounts -- segregating their debit access." But easy access can work against even the best of intentions. Apps can easily allow a change of heart, as consumers can quickly transfer cash, and enable the impulse spending they were originally trying to avoid.
Apps have limits
One difficulty for users who have accounts with more than one bank is that the apps aren't able to communicate well with each other, says Keslick. "If I have to transfer money from one back to another, I cannot simply do so using the apps."
And in terms of security, many millennials save passwords and logins instead of memorizing them, says White, adding "should anyone know their phone password, that can leave them very financially vulnerable."
Vanessa Santilli is a freelance writer in Toronto