Alternative Saving Applications - Finding the mobile app that replaces your bank account.

Alternative Savings and Investing Applications

Consumer behavior is moving away from traditional savings accounts to alternative saving applications. For the past 5-10 years there are more and more alternative investment vehicles coming to market. The best alternative saving applications are available on mobile. The quick and instant availability of your phone allows you to tied to your money like never before. Often times alternative saving apps will have something very alluring about them compared to their legacy finance counterparts. Consumers are getting sophisticated in how they manage their money. Often they are looking for a mix of a few things. This article serves as a way to find an alternative mobile savings app that fits you.

Reasons to Use Alternative Savings and Investing Apps

Alternative savings applications are a fast growing consumer trend. More and more people are finding a better way to manage their money outside of a traditional savings or checking account.

Investing your money in these applications is very common, if you have any other type of investing app that is not mentioned in this article please share it in our Discord server.

Returns

Returns might be the most important thing when consumers choose any alternative savings or investing app. The most popular savings apps will have a fair mix of security with returns. The more popular alternative investing apps will be more returns focused.

Unique Investing Opportunities

Unique opportunity is an interesting decision when looking for a new alternative savings app. Each opportunity that a financial strategy proposes is a unique opportunity. For example, just about every financial app does something different and proposes a new opportunity to a consumer. Betterment allows users to do something different than rally rd, coinbase does something else, and so do we.

Every Fintech app is slightly different. There is no correct alternative savings apps that is right for everyone. The best savings app is different for every person depending on their needs and financial goals.

Safety

Safety is obviously important, however plenty of these alternative investing apps are not FDIC insured. That does not mean they are necessarily unsafe, or scams in any way. There are plenty of ways for these new emerging investment vehicles to protect your money. Some are unable to secure FDIC insurance because the investment opportunity is so new that there needs to be more data on how to effectively protect these investment strategies. This might be a selling point for some, but the risk is sometimes worth the reward.

Principle Risk - Principle risk is an important factor when it comes to investing. Principal risk is a fancy way to say that the money you initially “invest” will remain at least that. Something like stocks or cryptocurrency is heavily affected by principle risk.

Automation

Automation is an important and overlooked factor when you are looking for your next alternative investment app. Just like pets, each pet needs a variance of attention to take proper care of it. Think of the same with these financial applications. Some people are only looking for goldfish, while others want a dozen cats.

Difficult products tend to be for very financially savvy people, or financial professionals, but don't let that scare you. Most traders end up losing money. Automated products make things simple.

If you want to use some more advanced alternative financial apps keep reading.

Different Types of Alternative Investing and Savings Apps

The goal of this piece of content is to find the alternative financial app is best for you. There are plenty of different types of savings apps. This article will help you find what mobile app is fit for you, so that you can maximize the amount of money you are saving for yourself.

Every person will have a different ideal category of saving they want to try out. This article will give you a more unbiased opinion on what it is you should start using based on your particular needs.

Passive Income

Passive income is something that people are constantly searching for. There are multiple alternative saving apps that use this as their main value prop. Passive income is an interesting niche. Apps that focus on this tend to be what younger generations are looking for.

Passive income apps are tricky, passive income is really hard to come by, however there are a handful of great solutions on the market. Each of these passive income savings/ investing apps comes with their downsides. Passive income in this sense means “You put money in the account and that money earns some type of a yield”

Wealthfront - Wealthfront is a terrific product that provides people with a great source of “passive income” Wealthfront is a very popular alternative savings app for multiple reasons. It offers people a multitude of services such as financial planning, investing, high interest cash accounts, and have a way for users to borrow from their assets.

wealth Front has plenty of great options for people looking for some type of an alternative to a bank account to earn some passive income. One of the many things the CEO of Wealthfront preaches about is “Self Driving Money”. This self driving money concept ties perfectly into what passive income is and has to be included on our list for passive income saving apps. In addition wealthfront has FDIC insurance up to $250,000 depending on the account type you have with them.

Outlet - Outlet is another great solution for people looking for an alternative investing/ savings app for passive income purposes. Unlike most apps on this list Outlet allows you to pull out your investment at any given time without fees.

Once you are on boarded and meet all requirements to begin investing and saving your money you will be prompted to log in with your bank account. You will login with Plaid, and from there you can transfer money to and from your traditional bank account to your Outlet.

Your sensitive and personal data that is required will not be saved by Outlet, and is currently sent to our payment partner Wyre. Outlet is unlike every other app on this list. Outlet plays a similar role that a traditional financial advisor would play, however instead of telling you where to invest or put your money Outlet does that for you.

Rounded Savings

Rounded savings is an interesting approach to saving as a whole. Small wins add up to a large win. The most popular app that uses the rounded savings approach is acorns. Acorns is an interesting savings alternative, as it uses the rounded savings approach for each purchase. Every purchase will be rounded up to the nearest whole dollar. Each purchase will have the rounded amount automatically saved or invested for them. There are several apps that fit into this category.

These are some good examples of rounded savings apps that people use as an alternative to a savings accounts.

Acorns - Acorns is another app that is very unique and genre defining. If you are looking for some type of a rounded up savings app the first you should look at is acorns. If you do not know how these alternative saving apps actually work then please read the following paragraphs carefully.

Acorns is an alternative savings app that allows people to round up their purchases and save the rounded up amount. Meaning that if you go to a store and purchase something for $9.95 the acorns app will round your purchase up to $10, and will invest the other $0.05 for you.

Depending on the settings of your acorn account you can clearly define where you want to invest your money. Acorns is a cool savings app because you are able to define what you consider a good investment.

Digit - Digit is a favorite for the financially savvy individuals. Digit gives you the most in depth analysis of your spending and monthly budget. Digit’s financial snapshot gives people the insight to save or invest like never before.

When you first open your digit account you are asked to provide some basic information about your income. Based on your income digit will tell you what it thinks you can actually afford to save/invest. This is a powerful concept, far too often do people invest too little or too much. Digit helps you find the perfect balance to make sure you are able to make the most of your finances.

Investments

Another alternative way to save and replace your bank account is an app that allows you to buy traditional investments, such as a traditional stock or investing application. These apps are easy to find, and a great fit for a lot of people who want something that feels “familiar” or something that other people use. People are often using these types of apps to totally replace their savings account. The problem that traditional investment vehicles such as stocks is that you are introducing principle risk. Principal risk is the concept that the principal amount you invest in is at risk of being worth more of possibly less than what you put in. If you are using a product that exposes you to principal risk that might not be what you want.

These are a few examples of alternative investing apps that you might be interested in:

Robinhood - Robinhood is one of the most recommended investing apps in America. The free stock exchange has plenty of features for rookie and professional investors alike. The application has several benefits for all types of non traditional investors. Features such as fractional shares, which allows you to buy less than 1 whole share of any stock.

Robinhood is a fan favorite due to its simple UX. People get intimidated when they think about investing or using some sort of alternative savings app. One of the many reasons Robinhood is a preferred alternative savings app is because it allows users to clearly understand what is going on. Even a rookie investor understands what they are looking at compared to more complex stock trading software.

Coinbase - Coinbase is another very unique alternative investing app. People can think of Coinbase as the gateway to cryptocurrency. Although Coinbase is a much more popular app in America, however it is still one of the best ways to introduce cryptocurrency into your investment portfolio.

Coinbase is the gateway to the world of cryptocurrency. Cryptocurrency serves many as an alternative to traditional saving. Bitcoin is the fastest growing asset of all time, it makes sense that people are obsessed with cryptocurrency and speculating on the future price.

Unique Opportunity

Alternative savings apps all have their own unique property, but only a few propose unique opportunities. For example, you might have met or heard of someone that treats watches as an asset class, people are making more money than every flipping clothing such as supreme for thousands. There are plenty of unique investment opportunities in the world.

Alternative saving apps tend to propose something new to the table. To be a consumer fintech app is hard. Every alternative savings app needs its own secret sauce so to speak. These are some of the go to savings apps that allow you to invest in unique opportunities.

Goat - Goat is an interesting app that is not much different than something like eBay. The difference between goat and eBay is that Goat specializes in buying and selling in things like sneakers, and other “hypebeast” type clothing. Clothing that has some type of value behind it based on the following of the brand, or other external factors.

With Goat the opportunity is the clothing. When you buy a shoe that shoe has a unique price associated to it. Goat provides the liquidity you need to see that investment back into cash. Goats marketplace makes this unique opportunity possible.

Rally road - Rally roadembodies the essence of opportunity investing. Rally road allows you to invest in unique assets. Assets such as cars, watches, and artwork. Rally road describes itself as “Rally Rd. is a platform where blue-chip collectibles are turned into stocks.” Stocks meaning an equity share of the collectible.

Rally road is the ultimate alternative savings or investing app. Rally road is a very interesting approach to a mobile app. Rally road is an incredible technology and allow people to invest in ways never before possible. Rally road shares are extremely interesting when it comes to a traditional investors point of view.

Rally road shares work similar to the way stock shares do in traditional companies. The downside to currently using rally road is that the markets can be very ill-liquid, so you may not be able to withdraw your money at a moments notice. There are times where you can not sell your shares.

The Downside of Alternative Savings Apps

The real downside to using alternative saving and investing apps is that they are potentially unproven markets, and you do not necessarily know where those markets will head. People who are using these apps should not expect the same service that traditional financial products have to offer.

The main difference between the two, non traditional, and alternative savings apps is the level of security. Alternative saving apps are not necessarily fully insured. Some are, and some are not. Alternative savings apps do not have a certain criteria like a bank does. Banks have to meet certain to call themselves a bank, there is no such thing for alternative savings apps.

Due to each mobile alternative app being almost entirely different they do not all meet a certain standard or criteria. Theses alternative savings and investing mobile apps will often have licenses and the legal compliance to be in business, but fall short of all have a unified criteria like banks have.

Conclusion

Investing should be for everyone, but traditional finance is not made for everyone. The solution that these alternative savings and investing apps propose in some ways fixes that problem. Saving your money in an alternative savings mobile app is arguably the same as a bank account, depending on how you use that savings or investing app.