If reading your credit card statement makes you as anxious as watching Uncut Gems, you’re not alone. The average Canadian millennial now spends a staggering 2.4 hours a day worrying about money.
From skyrocketing rents to student debt, our generation is juggling a huge amount of expenses every month. It’s no wonder that 60 percent of us haven’t started saving for the future and 77 percent predict we’ll have trouble paying for our retirement.
Enter KOHO, a Toronto-based fintech company that’s seeking to take the stress out of saving and bring balance to your financial life. They describe themselves as “an everyday chequing account, paired with a reloadable prepaid Visa card”—along with a personal financial planner that’s available in your pocket 24/7. They’ve got some impressive data to back up their claims: within 3 weeks, the average KOHO user saves 7% of the money they load into their account (through RoundUps and Savings Goals), vs. 2% the average millennial stashes away at traditional banks
Here’s how to use KOHO to kick start your savings plan, and alleviate some of that stress. Just think of it as your fiscal self-care routine.
As we all know, the easiest way to save money is to stop spending it. And if you’re looking to cut frivolous spending, you’ll want to start with your bank. Canadians are charged some of the highest banking fees per capita in the world ($217 a year, on average), and most of it’s just for the privilege of parking your money there.
KOHO doesn’t just promise no hidden fees: it’s free. Like, absolutely, 100% free. Untethering yourself from financial fees and penalties (like that 20% interest rate on your credit card companies) is a great first step to reclaiming—and saving—more of your hard earned money.
Since KOHO is a prepaid card, there’s no risk of you overspending and getting dinged with interest or an overdraft fee. And you can still use your KOHO card for anything you might use Visa for, since it runs on the same network.
KOHO is a new twist on banking, but don’t worry, your money is always safe and accessible. They’ve partnered with Peoples Trust, a federally regulated and CDIC-insured bank to hold any money you load onto your KOHO card. So if anything were to happen to KOHO, you’d always be able to access it via Peoples Trust.
It’s hard to save money when you have no idea where it’s going in the first place. And there’s nothing like the embarrassment of checking your balance and realizing you really did spend $30 last week on bottled water, ATM fees, and getting to that next level in Candy Crush.
Thankfully, KOHO has created a super-simple app for users to track their purchases and monitor their savings goals. You’ll see exactly where your money is going in real-time, and set your own budgets to know when you’re approaching your limit. Overshot your food budget this month? KOHO will let you know when it’s time to cancel that dinner reservation and stock up on rice and beans.
The KOHO app also allows you to set Savings Goals, which is a really helpful feature for tracking your financial targets both big and small. Let’s say you’re moving across the country for a PhD program next September, and have no idea how much money you’ll need to put aside. The KOHO app lets you set individual goals for everything from your airfare to the cost of a new microwave. Just add the estimated cost of each expense and the date you’ll need the money by, and KOHO will make automatic daily contributions to ensure you reach your goal on time.
Saving money feels fantastic, but earning it by doing basically nothing is even better.
KOHO offers a suite of features that’ll reward you for all that brilliant saving you’re doing. With their PowerUps feature, you’ll earn instant cash-bank on every purchase you make using the KOHO card, to the tune of 0.5%. The best part is that you can access this money within 1-2 business days, meaning you can quickly invest it and multiply those savings. Plus, you can earn an extra 1% PowerUp for each friend you refer to KOHO, which can really stack up.
If you make a lot of little purchases throughout the day (americanos, anyone?), you’ll want to check out their RoundUp program. After enabling RoundUps, every purchase you make is rounded up to the nearest $1, $2, $5, or $10, your choice. It’s a great way to stack those savings, and to keep track of just how quickly those “small” purchases can add up.
And unlike pretty much everyone with just a regular bank-issued credit card, the average KOHO user actually reduces their overall spending, and saves 7% of whatever money they load into their account.
So now that your financial anxiety has dissipated and your savings plan’s on track, what will you do with all this newfound KOHO cash?
Once you’ve got an emergency fund put aside—and a savings plan for long-term goals like buying a house or funding your kids’ education—don’t be afraid to treat yourself. Psychology shows that small rewards are a great way to incentivize future good behaviour.
So go ahead: start planning that trip to Barcelona. You earned it!
Want to start actually saving your money with KOHO? Click HERE to learn more.