People struggle to keep track of their spending and find it harder to save when they shop through apps, a new FSCS study has found. We asked some industry players for their views…
The Financial Services Compensation Scheme (FSCS) found ‘out of hours' shopping can have a detrimental effect on keeping track of people's spending and saving habits.
It surveyed more than 2,000 UK adults in March 2017 and found women in particular were prone to spending money through apps.
Women had an average of nine apps on electronic devices that enabled spending, the survey found, while men were more likely to have an app on their phone that helped them save or manage their money.
Many respondents said apps made it much easier to spend money, while some struggled to keep track of spending as a result. About 9% of women said they regretted purchases made via this method.
At the same time a number of people said they would be more likely to save if it were easier to set money aside. Regular reminders to save were also welcome features.
Informed Choice managing director Martin Bamford said he understood the difficulty consumers had with keeping track of their spending through app purchases.
"I personally have fallen victim to this too. The problem is that you don't feel purchase as much through an app," he said.
Bamford said it was important to teach both good spending and saving habits at the same time, particularly to children when they are young.
"Our attitude to saving and spending becomes so engrained when we're young," he said. "So it's really about introducing those habits at the same time, so children learn money is not just for spending."
Easier to ‘gamify' spending
The langcat communications director Mark Locke said the choice of apps that enable spending versus saving was also part of the problem for consumers.
He said: "It's so much harder to come up with an app that really works to help people save money, and that's likely reflected in the small number of saving apps available in comparison to spending ones."
Locke said it was easier to ‘gamify' spending than saving, as saving apps lacked the same "instant gratification" of a purchase and were not as engaging.
However, he added: "There are some investment and savings apps that are appearing, like Moneybox for example, that are attempting to gamify the investment process in innovative ways, and that's great to see."
Locke added: "But we have to accept the fact that spending will always be seen as more fun than saving for most people. Perhaps apps are not the hammer we need crack the savings nut."
FSCS spokesperson Suzette Browne said: "Having the ability to make purchases at the touch of a button is both a blessing and a curse.
The chairman aims to shore up morale
UK economic headwinds are building
Three step reporting process
SJP academy hired 35 grads in May
Three advisers have their say…