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How to choose the best budgeting app

A good budgeting app can help you spend and save both safely and wisely.

jar labelled budget and smartphone

Keeping track of your income and expenses can be complicated. Good budgeting software can save you a lot of time and effort. 

Most money managers are available for desktop and mobile, so you can keep track of every little expense you incur throughout the day.


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What can budgeting apps do?

Modern money managers are big on convenience. Back in the day, smart savers would typically use a spreadsheet to organise a budget. To save on time and effort, budgeting apps automate at least some of the process while handling all the calculations. Budgeting apps can:

  • Import financial information from spreadsheets or directly from your bank account
  • Streamline your spending and saving plans
  • Generate budget reports, graphs and charts
  • Some can display financial trends, forecast spending and flag expenses as tax deductions

Paid vs free budgeting apps

Many paid apps have a free version with fewer features, so you can start free and upgrade later if you need to. Sticking with the one app will be easier for you in the long run.

Common features of paid apps

  • Create savings goals
  • Sync with your bank account: Your app communicates with your bank to record your transactions and automatically sorts them into categories such as 'dining out' or 'groceries'. 
  • Sync with unlimited bank accounts: Most free apps will sync with just one.
  • Create unlimited budgets: Handy if you have multiple savings goals or want to cut down on spending in specific categories. Most free apps offer just one.
  • Multi-user collaboration: Lets you and a partner or partners access the same budget.
  • Advanced charts, forecasts and reports: Lets you track in detail where your money is going. Some budgeting apps also forecast how much money you'll spend over the next month if you keep going at the same rate.

Not all paid apps have all these features, and some offer a few in their free version.

Bank syncing vs file import vs manual entry

Budgeting software is useless without income, expense and other financial data. You can manually enter information into any available program, but they can also automate the process to varying degrees:

Bank syncing

You can sync your bank account with the app so it automatically pulls in data, including income, expenses, regular bills and so on. This is the easiest approach to accurate budgeting, as the software handles most of the data entry for you. The caveat is that you have to entrust a third party with your bank account details. 

Bank account syncing is often a premium (paid) feature, but sometimes you can get it for free, such as with Pocketbook. Budgetbakers' Wallet and Goodbudget both sync one bank account for free, but you'll need a paid subscription if you want more.

File import

Most banks and financial institutions let you export account data, which you can import into budgeting software. There are several file formats floating around, but .CSV, .QFX and .QIF are the most common. 

This approach is quite secure, and it can save a lot of time compared to manual data entry. However, this option isn't automated, so the onus is on you to import data regularly. There's also no guarantee that the software will read the file's data accurately.

Manual entry

Manual entry is the most accurate method, but it's also the most time and effort intensive. 

It's important to be consistent. You don't have to log everything; pick what types of expenses you think qualify before you get started and make sure you always record those. 

Manual entry is a common inclusion in free and paid budgeting apps, but isn't available on banking apps.

Which method is best?

Bank syncing is the easiest option if past budgeting efforts haven't been particularly effective. 

One of the hardest elements of budgeting is confronting how much we spend and, at times, leaving luxury items behind. When you use manual or file import methods, it's easy to fudge the data, skip an expense or "forget" to enter one. Bank sync, however, pushes you to be honest with yourself.

But it's still useful to add or correct some things manually. Bank syncing sometimes files transactions under the wrong category – for example: if you were to withdraw $100 cash at a supermarket checkout, that $100 would count as a grocery expense – so it may be necessary to make some tweaks. 

Is bank syncing secure?

Note that your bank may hold you responsible if money is fraudulently taken from your account as a result of sharing your login with a budgeting app. Check with your bank before using a third-party app that uses your bank login information.

Software that can connect to banks usually uses account aggregation services. These are third-party programs that establish a secure communication channel to pull all the necessary data into your budgeting software. 

Salt Edge and Yodlee are two popular aggregation services used by many budgeting programs, which provide detailed security information on their websites. Third-party protection can be beneficial, as aggregation service security specialists may be better at protecting your data against online attacks, compared to software developers. Some programs support bank-sync, but do not specify whether they use a third-party service or their own systems.

Types of budgets

There's more than one way to budget your bank account, but this isn't an area where one size fits all. Most programs use at least one of these popular methods:


Breaking your income/expenses into specific categories – such as work, leisure, travel, food and so on – with an expense limit. Incomings and outgoings are moved into the relevant categories, so you can see whether you're under or over the limit you defined, at the end of a specified period (e.g. a week).

Envelope method

Similar to categorisation, you create different envelopes for each expense type (food, power, internet etc.) at the start of each pay cycle, add the amount of money you expect to or are prepared to spend for a certain time period, and withdraw from the relevant 'envelope' when necessary. Any leftover money can be rolled into the next period or moved elsewhere. If you wind up with an empty envelope before your time is up, you need to reassess your spending, or your budget.


Budgeting based on expected needs. You prepare a list of predicted expenses for a certain period, and budget your income accordingly with the expectation that the money will be spent. Every expense must be categorised, leaving little-to-no room for frivolous purchases. Income, minus expenses must equal zero, although expenses can include savings.

Bank apps

Each of the "big four" banks (Commonwealth, Westpac, ANZ and NAB), as well as a number of smaller banks and financial institutions, provide their own budgeting software or calculators. These typically require an active bank account to use. For example, a St. George customer can't access Commonwealth's Netbank budgeting tools. 

Depending on the app, official banking apps can be useful for budgeting, and can even lump transactions into categories. However, you usually can't manually edit any of this data, so you're stuck with what label your bank files certain expenses under. 

One benefit of banking apps is up-to-date, automatic transaction records that don't make you give your online bank details to a third party.

Budgeting apps tend to have far more features than banking apps, and are better if you're serious about budgeting. But if you just want a broad overview of where your money is going, then you might get by with what your bank provides.