Family Finances – Organize your savings with QAPITAL
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Hello again! Thank you for stopping by! We have been talking about family finances for a while. Find all of my articles on the topic here. I want to share with you all the tools we use to better manage our finances. Another of my favorite tools is Qapital.
We categorize all of our expenses and keep track of our budgets thanks to Mint.com, but I found it hard to manage the transactions I call Extraordinary Expenses: those expenses that are known and expected, but that happens on an irregular schedule, not monthly.
Some of my extraordinary expenses are: Taxes (paid once or twice a year), dance company (my daughter is part of a dance company that charges me every 3 months), school and sport/dance pictures, teacher appreciation gifts, my hair salon (I have my hair straightened and cut every 3 months), birthdays (cake, parties, presents, etc), holidays (saving for Christmas presents, easter baskets, halloween candy, thanksgiving feast, etc), summer camps (I start paying for some camps as early as January), HOA fees and community pool passes (paid once a year), clothes (usually bought in the Spring and in the Fall).
I also treat savings as extraordinary expenses. We save towards, emergencies, home improvement projects, vacation, etc. We automate payments to our credit cards, kids’ college savings and retirement accounts, so I don’t count those amounts within our income and don’t save for them as I would for other goals.
The most popular method to handle these expenses is saving a set amount every month on a savings account from which you would deduct these expenses. You could also use a credit card to pay for these expenses and pay it off from that saving account. If found that saving that way didn’t give me visibility into how much I had saved or spent for each goal/expense. I would often just tap into that savings account to pay for random things because there was no visibility and no control.
The extraordinary expenses were always ruining our financial situation, and discussing or arguing about it would take most of the time during our finances meetings. It was crazy!
Ideally, I would have different savings account for each goal/expense, that way I would know exactly how much we have saved towards each and how much we have spent on each during the year, but can you imagine having so many savings accounts for all the extraordinary expenses and savings I mentioned above? It would be a nightmare to manage all those accounts.
I searched high and low for a solution to this problem and I found Qapital. It’s an app and they are working on the desktop version of it. It provides you with a checking account and a debit card and a savings account that you can divide into what they call ‘goals’.
This is how it works, and how we use it:
Link you funding account. It’s safe!
– The funds in your Qapital accounts are all insured by the FDIC. That means that you’re covered for up to $250,000.
– Qapital is secured with the latest and strongest SSL (Security Sockets Layer) and TLS (Transport Layer Security) encryption standards. Bank communication is only transmitted over encrypted endpoint, and your personal info like Social Security Numbers and login information is never stored on Qapital Servers.
– Identity protection with passcode access, fingerprint ID, and remote lock of your debit card and accounts. How cool is that? I can imagine locking my teenagers’ cards sometimes.
You will have to link Qapital to a checking account to fund your goals, or you can set up direct deposit from your employer to your Qapital. There are no fees for transfers or direct deposits.
It’s super easy to create goals or saving accounts within Qapital. You can assign a name and a picture to each goal, so they are easy to identify in the app. You can also assign an amount you would like to save for each goal, so you can track your progress and celebrate your milestones.
An incredible feature are the rules. They have many all ready to go, but you can also create all sort of custom savings rules with IFTT (If This Then That). Some of the preset rules I use:
– Freelancer rule: save 30% from each paycheck to pay for taxes.
– Set & Forget: set up daily, weekly, or monthly deposits to make savings automatic. You can then decide where these savings go by selecting the goals you would like to fund with each transfer.
– Round-Up rule: save the change every time you swipe your card or every time you get charged for anything. You will be amazed at how much you can end up saving every month without even noticing because you are only putting away a few cents every time.
Other preset rules include:
– Payday rule: pay yourself first. Save a percentage each time you get paid
– Guilty pleasure rule: Save a little whenever you buy the stuff you are trying to resist (Like Starbucks!)
– Spend less rule: Set a budget. Come in under. Save the difference
– 52-week rule: Save $1 week 1, $2 week 2, and so on for 52 weeks, and save $1,378 by the end of the year
– Apple Health rule: Reward yourself for hitting fitness goals.
Some of the rules you can set up with IFTT are:
– Save every time you hit your Fitbit goals
– Save when the temperature rises above 75 degrees
– When it’s freezing save for a sunny day
– Save when astronauts soar overhead: the International Space Station orbits earth 16 times a day.
– Save every time you post on Instagram
– Save every time you Tweet
– Save every time you play a Spotify playlist
and many, many, many more!
Move money between goals and accounts
This part amazes me. You can move money unlimitedly from your goals and checking account within seconds, not days! and with NO FEES! You can also move money from your checking account and your funding account with no fees, but it will take a couple of days to hit.
Every time there is a transfer from goals or accounts, and every time you swipe your Qapital card you get real-time notifications on your phone, so there are no surprises.
Your balance is always up to date. No pending charges.
This is how I use Qapital to manage our family finances, especially our extraordinary expenses and savings:
- We use Scott’s salary to pay for our recurrent expenses and college funds and we use my salary to pay for our extraordinary expenses and savings
- I asked my employers to make direct deposits to our Qapital account
- I set up the freelancer rule to save 30% of every paycheck to pay for taxes later.
- I also set up the set & forget rule to distribute the rest of each paycheck equally between all of my goals
- When a goal is completed I stop saving towards that goal (until I spend it at the right time and have to reopen it and start saving for it again)
- If at some point I need more money on a goal than what I have saved for it, I move money between goals. For example, if it’s time to pay for the HOA fees and I don’t have enough saved for it, I might borrow money from the Summer camps goal because I know that I won’t need it for a while and I can keep saving towards it until I need it.
- I use my Qapital debit card to pay for extraordinary expenses. You can also use the app to send checks to pay bills.
- To pay for expenses I move money from goals to the spending account (it takes 2 seconds) and swipe my card then, that way I make sure I am using the money from that particular goal.
Qapital was a big reason why we were able to save money for the first time in many years. I love it and I hope you do, too! Let me know if you have any questions by commenting below or sending me an email.