Banking and Saving Money with Monzo
Just over a month ago I opened a bank account with Monzo and have been using it as my main bank. I wanted to be clear on my finances this year, seeing exactly what I’m spending money on and try to save money too. A few of my friends recommended Monzo, a fully fledged bank that is digital only, all controlled via the Monzo app. They claim to be the bank of the future - and I totally agree this is the way forward. Here’s my review of Monzo:
Traditional banking is irritating
There are many things that I find irritating about traditional banking. First of all, I hate cash. It’s hard to track spend, it takes up room in my pockets and it’s easy to loose. I avoid cash as much possible, and have moved to Apple Pay as my primary method of payment, followed by debit card if required. Of course, cash still has its uses and is necessary in some situations, but this happens a very small amount.
However, contactless and debit card payments present a major problem within my high street bank, Halifax. I cannot see how much money I actually have to spend. Each time I use my Halifax account, payments move to “pending payments” , which causes the headline bank balance to be inaccurate. I can work out how much I have, but I shouldn’t have to.
Monzo shows me how much money I actually have to spend
Monzo updates my available spending balance in real time as I use the (amazingly good looking) debit card or use the account via Apple Pay. It also provides me with a notification each time I use the account, categorising the payment into things like entertainment, bills, or eating out. The summary screen which shows my available spending balance and what i’ve spent money on - which I can see by each transaction or each category. The summary also takes into consideration my committed spend, such as my upcoming bills and deducts this so I can see how much spending money I have, as well as the total bank balance. I love this - knowing exactly how much money I have is so helpful.
I’m saving more money with Monzo than I ever would have with my high street bank
Monzo also allows me to automate my savings and save me more money than I would have done with Halifax. Monzo account holders can create “Pots” - a way to store money away. I usually put money away each month from my savings, which I will continue to do with my savings pot that I have set up with Monzo. However, Monzo allows me to save even more without having to think about it, in two ways. Firstly, I have switched on the “Round up transactions” setting. This means that every time I spend money using my Monzo account, the transaction is rounded up the nearest £1, with the “spare change” being moved into my savings pot. This is a great way to save, and also not feel so guilty about spending so much on a night out 😉
I’m also using the IFTTT app to participate in the Monzo 1p savings challenge. IFTTT which has a partnership with Monzo, automates my savings, by moving a small amount of money from my spending to my savings pot every day. The 1p challenge started from 1 January, saving 1 pence. Each day the amount it saves increases by 1p, so on 2nd January it saved 2 pence and so on.
Sending and requesting money has never been so simple
Account numbers and sort codes…. who actually likes these digits? Having to ask someone for their account details is problematic when it comes to sending money to friends. It’s unnecessarily complicated. With Monzo, I can send and request money to fellow Monzo users in seconds thanks to “pay nearby friends” feature - each person just opens up this section of the app. Each Monzo user is also given a Monzo.me page, which allows non Monzo users to send money easily, just by using a card payment, Apple Pay or Google Pay.
Despite my love for Monzo, there are things that it can’t do effectively (yet)
Monzo does encourage its customers to go “Full Monzo” and use the account switcher service to move direct debits and income over from an existing bank account and automatically close your old account. However, I have kept my Halifax account open as there are a couple of things that I cannot do without a charge or time delay (which may change as the product develops) . You cannot currently pay in cash unless you use a store that allows PayPoint transactions, also charging you £1 per deposit. To work around this in instances where I need to pay in cash to an account, I have paid into my Halifax and transferred the money across to Monzo. Also, paying Cheques into a Monzo account currently involves posting the cheque to Monzo using freepost - although Monzo has said they are working on paying in cheques by taking a picture of it in the Monzo app (A feature already available with Halifax). These things aren’t a deal breaker for me, because I aim to not use cash or cheque.
Monzo is constantly developing new features, with the help of its users
What I love about Monzo is that it’s developing new features all the time, with all plans shared in the product roadmap and blog. They heavily rely on feedback from its users in its community forums and aim to make banking simpler and more transparent, cutting out the financial jargon that nobody actually taught us in school. And from my experiences of it so far, it is absolutely doing that - its simplified banking, improved my spending and made my life a whole lot easier!
If anyone is thinking of joining Monzo, do it! Plus, if you use my golden ticket link to sign up to Monzo, we both get a fiver: https://join.monzo.com/r/iadc2pg 💰