The Refinement Club

Dec. 16th: Budget App

The sixteenth day of The Refinement Club’s Advent calendar features Ingrid Lea, Torny Hesle and Thale Høy-Petersen’s idea about budgeting and money spending. Enjoy!

Problem
The replacement of debit cards instead of cash as the most common payment form has made it harder for users to control their own consumption.  Unlike before, when you could clearily see your wallet shrink after purchases, you now have to check your bank online afterwards too see your expenditure – and then it’s often too late. Several banks even let you exceed your balance without being aware of it.

More and more young people struggle with taking control of their economy, and the main reason is that there are no (good enough) tools to handle it.

Consumers need a tool that makes digital money more visible and handle their spendings sensibly. 

Solution
Our solution is to create an app that visualises the consumption and brings the online bank closer to the moment of purchase. The app is a solution for both your online bank and smart phone.

Today your online bank show what you’ve purchased through your transaction list; ”Purchases, Café Isabella,  kr. 312” or ”Purchases, H&M, Oslo City, kr. 298”.

Since the bank already lists the location of the purchase, these locations can be sorted into categories like ”Food and household”,  ”Clothing and accessories, ”Social and entertainment”, ”Transportation and travelling”,  ”Other stuff”.

The bank automatically creates a standard category system, but you are free to change the categories and locations so it suits your lifestyle and budget.  Some may want Cafe Isabella in ”Food and household” because they dine there three times a week, while others may want it in ”Social and entertaining” because they go there with friends to drink beer every friday.  So if you are of the last kind and you move Cafe Isabella from ”Food and household” to ”Social and Entertaining” the system will be updated and from now on store purchases from Cafe Isabella in that categoy.

Most budget systems today requires you to fill in your predicted spendings, but the problem is that you don’t have overview of your previous purchases. You often spend more than you think, and this is why you also end up broke. The first time you use our budget solution your online bank bases your budget  on last month’s bank statement. This opens your eyes to where your money flies off, and based on this you can adjust your budget.

Let’s say you spent 2800 kr on clothing and accessories last month, and you  realise that’s way too much, then you adjust it down to 2000 kr in your new budget.  You can choose to get push notification whenever you reach an optional amount, like 1500 kr, or halfway, or at several specified amounts; ”You have now spent more than 1500 kr on clothing and accessories. It’s time to tighten your belt”. 

Whenever you want you can check how your different budget categories are doing.  You can also calculate if you can afford that nice pair of shoes you’re longing for: 

”Item 1, clothing and accessories,  kr 249”
”Item 2, clothing and accessories, kr 499”

Ex 1) ”You can afford both Item 1 and Item 2, but after that you’ll only have 129 kr left in this category the rest of the month”.

Ex 2) ”You can afford Item 1, but not item 2. However you still have 1300 kr left in Social and Entertaining this month, so you can move money from that category.”

This way you’ll get a clear view of how much money you’ve got, and if you actually can afford buying the stuff you want.

It’s important to specify that the budget app isn’t based on how much income you’ve got. Even though you have an income of 10 000 kr/month you’re budget can be 8000 kr/month.  The app helps you taking control of your everyday economy, and varying expences, and therefore it helps you to save money.

In the end of every month you can adjust every category for the following month. Maybe you see that your Food and household budget isn’t realistic; raise it. Or maybe you want to save money on Social and Entertaining so you can raise your Clothing and Accessories budget since you need a new winter jacket. If you have money left after all categories are added up in the end of the month, you can choose  between saving them (deleting them from your budget) or keeping them as a bonus in next month’s budget.

In addition to being a personal budget solution, this app will also show your bank that you know how to handle your money (benefits when it comes to loans etc.)

There are several ways to save money. This solution does so just by keeping you from wasting all of it. And it gives you an overview of your spendings straight from your pocket.

 About us
We (Ingrid Lea, Torny Hesle and Thale Høy-Petersen) are a creative team graduating from Westerdals next summer. Our passion is advertising (read: trendy, creative problem solving), but we do a lot of other stuff too; right now we’re doing individual projects where Ingrid puts moss and reindeers into glasses, Torny makes plush creeps to keep kids from crying and Thale knits herself in a full scale 1:1 model.

This idea is under construction, we’re going to develop it further, and appreciate feedback!

 Would you like to submit your own idea to our calendar? Go ahead!