I’m glad this resonates - this was exactly my thinking!
And this is excellent! I think an onboarding flow is an excellent idea - and a budgeting/money management one that could be started any time from the app would similarly be super helpful. Maybe something that walks through the different balances, different ways of budgeting, setting up things like salary sorter, future transactions etc…
Interesting. I was working on the assumption that Pots would not be included in any of these balances. What were you thinking?
Yeah I think the Starling way is a nice approach, and I agree with the sentiment around the pot approach. I fear it may have locked Monzo in to an inflexible system, at least when it comes to future expansion.
Maybe it’s expanding on the use of locked pots / savings pots in a clever way to benefit all approaches? I’m sure there’s a “covers all needs” mechanism in this, just not sure of it. Paired with things like “pay from pot” or the Starling Overdraft mechanism it might be more seamless that I am currently imagining.
I’m trying to type this out on mobile which isn’t very effective so will come back in a bit for the rest…
I’ve made a ninja edit to the opening post. I think this can be squared by basically having two sorts of pots: “offset pots” that work like Starling’s goals spaces and normal pots that work like they do at the moment.
I think there is probably utility for proper segregation (like we have in the app at the moment) but also to have the ‘offset’ set-up.
So I guess the budget in YNAB is set up for monthly recurring expenses, yes, but the idea is you don’t plan (and then do) the expenditure until the money is in hand.
For people on the start of their budgeting journey, it should work to align priorities to spending. “This is all the money I have for the next 18 days” - and it must do Jobs A, B and C. I know Job D is coming in 22 days, but I will be paid again by then. When (Pay) Day 18 comes, Job D gets budgeted for. At that point in someones financial life, it’s a very functional prioritisation mechanism (IMO).
As ones finances mature though - the same applies but you, by nature of building healthy savings, look further out. e.g. lets say I have 3 months salary sat in the bank, I keep 1 month as “Emergency Fund”, and the other 2 are planning the next 2 months of budget. So when I get paid in February, I will use that money to budget May spending.
So effectively, this part of budget is a forecast of future spend based on money on hand, and not theoretical future money. But I think that is still “Budget” so that’s OK.
That said it’s not bullet proof - contractual obligations and what not mean you can likely forecast expenses forever… But I think it’s a system that keeps you honest / accountable to priorities
Yeah and I don’t at all disagree with what you’re getting at conceptually - I just think this forecast should be a separate entity to the budgeting aspects. Sure one can inform the other - but I’d see a real risk in a combined ‘thing’, if nothing else just because of the types of “well, I will have £x in a week, so why not spend £X now” transactions that littered my youth
But I think a lot of those points are semantics - and certainly the underlying tools and approaches should have improvement to do some form of combined budgeting and forecasting!
And yes couldn’t agree with this more! I’ve never trusted that “available to spend” figure, it would be so useful if there were options and abilities to set it up so that the data can inform meaningful actions
Wow, lots to get stuck into there. Tomorrow, though, I think!
One immediate question: you’re keen for the Simple approach, right? I thought that Simple does include upcoming income? Especially given it works on a rolling 30 period and salary is usually more frequent than monthly in the States. Have I misunderstood Simple, or is this a place where you disagree with their approach?
I’ve been thinking a lot about the conundrum of whether financial planning features in Monzo ought to take account of upcoming credits to your account or not.
I think we probably need to break this down a bit:
In the future transactions / upcoming list, I think you do need to have credits. For example, If you know you’re transferring £200 from savings to cover an exceptional expense, then I think you should be able to prepare for that.
What I’ve been calling the “Left to Spend” balance is different. I’m persuaded by the arguments that you don’t want people to spend money they don’t have - so I think this should probably exclude upcoming funds until they hit (or until they show as greyed out future transactions).
I also think the Left to Spend budget should plan to the end of the current budgeting period. I was originally envisaging a rolling period, but I can’t see how that’ll work without including future credits in your Left to Spend figure (which I think we’ve agreed is a bad thing).
First point:
For future planning, beyond the current Summary period, you absolutely need to be able to see all planned incomings in addition to planned outgoings (manual or automatic). Such future credits would probably be in the form of manual, recurring future transaction entries unless Monzo can carry through existing, recurring credits into the future - although to be fair, this entire feature is useless without a rolling balance.
Second & Third points:
I don’t have budgets set and so I view left-to-spend as what I have ‘left to spend’ in the next 4,3,2,1 weeks until the specified monthly incoming payments lands and then triggers the next Summary period. This then resets the Left-to-spend figure and the monthly/summary cycle continues.
I’m not sure how having budgets set would affect this, as the Left-to-spend figure changes?
For me, I think the now and past are more important than the future (to a degree) and once you sort the first two, the last one is a lot easier.
I like this. But I want to see progress. How many days was my account above £xx in the last month, how does that compare to previous months?
I like this. I’d also like to be able to do it in advance. “I think I’ll get paid £xxxx and this is what I want to do with it”
End of month summary is terrible. Truly terrible. Bin that.
I’d like a “How I’m doing” section almost.
Last month I bought some trainers when I got paid, but this month I didn’t, so I must have spent less. But forgotten in there is the coffees or triple the amount of cat-food I need.
I keep posting this because to me, this is the most important metric in my account
(Pleased to say it’s looking a bit better this month!)
What’s my budget, what have I spent and how does that compare to another period? Am I on track? Can I afford those trainers without blowing my budget? Or will I run out of money 10 days before payday if I do?
As for future things, I think I’m in the no camp for this one. My salary/bills are pretty regular, but lets say you get a big bonus or you’re heavily commission based, to see that next month Monzo thinks your salary will be £1000 and you’ve got £1200 going out, that could worry people before they realise their predicted salary is wrong.
Something else I think would be good and this probably goes back to the old hub idea. If I’m paying British Gas or Vodafone or whoever, exactly the same amount for over a year, could they give me a nudge? “Did you know that shopping around for your utilities can save you ££?”
Or…
“You’ve paid for The Athletic for 17 months in a row. Are you getting the most from this subscription?”
The latter, as they are not direct debits and Monzo can’t/doesn’t predict them, I would imagine it’s quite easy for them to get out of hand.
Could Year in Monzo give some totals for recurring payments? I paid for Netflix monthly and maybe £9 is fine a month, but if I see that in an annual total, am I more inclined to cancel it?
Left to spend/safe to spend, should work well. But simple things break it.
I put money into pots for direct debits (which works fine) and one for food, which doesn’t. IFTTT replenishes my account but it removes it from my budget and doesn’t re-add it.
So for round numbers and an example;
Spends - £500
Food - £300
I have to set my budget at £800. Which is counterintuitive because it’s more than is in my current account, because otherwise when I spend £50 in Tesco, money goes out, funds from pot come back in, but it’s still left me £50 down.
I just ignore it now really but it would be good if anything coming back into or out of my account, changed the budget.
I’ll try and knit this all together at the end (gulp) - but I think that ideally the Left to Spend figure should be different from the budget figure. That’s why up here I had them as two separate ‘balances’. Much easier to get your head around that way (especially given that we’ve seen a bunch of confused people on here wondering why they’re going to run out of money when they’ve forgotten that they’ve set a budget).
This is excellent work! I’m taking a bit of time to get through everything, but I think I have your needs covered (in my head at least).
I’m interested in you putting this all on one screen though. I’ve already set out how I see the future spending working - I see (spoilers!) the graphs and analysis sitting under what’s currently the Summary button. But then I did wake up wondering whether it’s a stretch too far for Monzo users to create their own home tab (think Android widgets and being able to pull in different elements - balance, feed, graphs etc, as a bespoke way of managing your money) The one thing we know is that everyone is different, right?
Oh yeah, we’re going there!
I agree with all of that. Hopefully we might be able to unpack some of that once I get to what I’m currently thinking of as a replacement for the Summary screen. This won’t be Summary, but should reveal data, provide visualisations and almost coach you financially (should you want that). I think that’ll be an interesting thing to throw around (but have focused on some of this stuff because you kinda need to do the foundations before you get there).
Just so I’ve properly understood: your budget is the same for both years, and you overspent and the end of the month in 2020, but ended up underspending in 2019?
Introduce more pot types and allow users to pay from pots
Important thing 1: connect a virtual card to a pot
This shouldn’t be a surprise to anyone, but the ability to pay from pots is one of the most requested features. It’s likely (but not guaranteed) that this might become a feature of Plus or Premium - probably by hooking a virtual card to a pot.
To try and contextualise this, this is important because if you’re using pots to budget, then being able to spend from those ring-fenced funds is super important.
Important thing 2: connect virtual cards to Google or Apple Pay
. For the full service, though, we’d need to be able to add virtual cards to Apple or Google Pay - and potentially customise those card images (would it be great if it displayed the pot name / image in Google Pay instead of having multiple Monzo cards that you can’t tell the difference between?)
Yes please to all these pots changes. Another topic I have Opinions about!!
Can I throw some of this into the mix, for more pot based discussions. I think most of these have come up through the course of feedback suggestions anyway, but I think they all have a financial planning flavour to them:
As someone who likes to use my pots as envelopes:
Increase the total number available - much like having only a small number of categories, if you are using Pots for planning, you can only be so specific with the limit of 20, and I need more!
As well as the ability to link Virtual Cards to a Pot, I’d love to see Virtual Cards on Apple Pay (slightly different flavour to @Peter_G’s suggestion of linking a pot to apple pay
Direct Pot-to-Pot transfers - so I don’t have to clutter up my feed with moves in and out
And finally a way to natively assign a merchant to a pot (which is again similar to pay from pot, but at the merchant level rather than card level). I think in this bucket there is the potential for all sorts of “Do X From Pot” type activities, I hope more come
Correct. It’s really my budget for this month and just seeing how I did in a previous month. I used that screen grab as it’s one I had for my sheets guide in the comparison.
So now I know I’m doing better than last month and if I want to splurge a bit, there’s room there.
I won’t quote your whole post but that is a collection of excellent thoughts on pots. To to be able to have a virtual card in ApplePay that’s attached to a pot would be amazing.
This is my biggest want. Not so much for the feed, but I keep pots hidden. I got a refund this morning that I wanted to move. So I had to unhide a pot, move it, then rehide the pot.
“Move this incoming payment to Pot” would be wonderful.
I actually had a much longer post prepped that included that, but I edited for simplicity!
I would have said that there are two broad options: you connect a virtual card to a pot (and to the Pays) or that you add specific merchants to a pot. The latter way, it shouldn’t really matter how you pay - it’d always come out of the pot. But I think that comes with significant complexity - and the logic would need to be perfomed in the miliseconds that Monzo has to process a card transaction. So, I suppose I (regrettably) discounted it to focus on a simpler (?) option that option A gives us. Which, I think, would cover 80% (if not significantly more) of the need…
I don’t have any hidden pots… So have never experienced this… But seriously… You can’t move money into a hidden Pot? I can understand not having the ability to move money out…
I see that’s been in the past part of the reason why Monzo have said it’s not [currently] viable - totally get the logic behind the limited time for actions, but @N26throwaway covers it well:
Basically a “pay back” system would work.
In my head, I can envision the “instant decision” transactions being the “Pay from Pot” link, wether than is a VCard or the Mobile Pay from Pot (or whatever iteration, including “Mobile VCard Pay” too which I still would love).
And anything else working on the “Pay back” approach.
It’s sort of a native version of the IFTTT “If transaction at [Vendor]”
That said, all of this would make a great building blocks for a totally integrated style of IFTTT offering - all of which can be a post-transaction trigger to reduce the millisecond decision factor.
I’ve just hidden a pot to test that, and it looks like that works.
As does this!
What I would really like is a line in the “Payments” screen for an internal transfer, there’s a button already for moving money between Monzo accounts, so a Pot transfer could sit nicely here too. Far less clunky than trying to get to the list of pots. IMO.
