You’ve scoured the internet for weeks.
You’ve read a dozen entries from trusted personal finance blogs.
You’ve even gotten personal recommendations from friends, family, and social media connections.
And you’ve finally, finally found the perfect financial tracking app.
And, bonus, it’s free!
But, here’s the thing.
Nothing in life is truly free. There’s always some kind of trade-off.
And if that fact hasn’t occurred to you while you’ve been happily using your “free” financial tools, we highly suggest you keep reading to make sure you’re aware of and willing to pay the (hidden) price.
The Hidden Costs Behind “Free” Financial Tracking Apps
If you’ve ever wondered what the phrase “If something is free, you’re the product.” means, let us break it down for you in the context of financial tracking apps.
Free Access Often Means Limited Features
Have you ever fallen for a “free” app just to sign up and find out only certain, very limited features were actually available for free?
This trick isn’t as nefarious as it is simply annoying.
Since financial management apps often attract people who are looking to save or are overall very careful with their money, we unfortunately see this kind of sneaky marketing a lot in our field.
If a “free” financial app isn’t upfront about how that price tag of zero really only applies to their free download, free tier with very limited features, or free indeterminate trial period — in what other areas should you question their truthfulness?
Annoying Upsells That Steal Your Sanity
This is another thing we see a lot when it comes to “free” money management tools that also isn’t dangerous but can certainly be maddening.
Often, “free” apps put out by bigger companies with bigger sales departments are little more than sales funnels. Their salespeople treat their user base like a pool of “leads” to whom they try to sell paid products or services — sometimes relentlessly.
Personal Capital is a prime example of a tool that offers “free” financial management features that come at this hidden cost. In fact, there are plenty of stories of people getting cold sales calls from Personal Capital for years.
The purpose of Personal Capital’s sales calls is to persuade users to add at least $100,000 in assets to their accounts. This threshold is when their customers are eligible to begin working with hands-on financial advisors for a fee of .89% to .49% of the value of the assets.
Now you know how Personal Capital and other legitimate financial tracking apps make money despite seeming to offer services for free out of the kindness of their hearts.
White-Glove Service? Could Mean Extra Eyes on Your Private Financial Information
Now we’re ramping up to the danger zone when it comes to the dark side of free.
When any tool offers you white-glove service, that means a real human being, one who is of course capable of making mistakes, has complete visibility into the financial assets you’ve entered into the app — and who knows what else.
But because technology can create a feeling of separation from the company and people who are providing a tool, users easily overlook this fact and feel blindsided when they find they’re “paying” for a service by trading in their privacy.
Let’s use Personal Capital as an example again. We found this story about PC on a personal finance forum:
“I used the free tool for the past year and found it really beneficial to see things like my market allocation. However, I went on one of their complimentary wealth management calls and realized that without me giving explicit permission the Personal Capital Wealth Advisor had complete and unrestricted access to my account.
“I immediately deleted my account and am not going to use them going forward.”
When your privacy is on the line, “free” tools like Person Capital and others don’t look like such a great value after all.
Paying the Ultimate Price: Losing Control of Your Data
If invasion of privacy is bad, actually losing control over your own financial data may be worse.
What do we mean?
We mean the tendency that many “free” financial trackers have to actually sell their user data to advertisers and other entities in order to make money. Mint is one of the most popular financial tools to sell advertisers aggregated data that includes information about their users’ spending, average credit card balance, number of retirement accounts, and so on.
Sure, Mint and other similar tools promise that the user data they sell is aggregated in a way that makes it completely anonymous. But what if, one day, it isn’t?
What if their system for ensuring anonymity doesn’t work as well as they think it does — or gets hacked?
What if a shady company outright lies about just how anonymous the user data they’re selling is?
What if they decide they want to start selling data to organizations that you don’t want to have your information, like a government agency?
Selling your data to the very entities that many of us actively try to avoid on the internet is the very definition of you being the product when it comes to free apps.
How to Make Sure a Free Financial Tracking App Is Safe
All of the above isn’t to say that choosing a financial tracker that costs a pretty penny is an instant gateway to limitless features, total privacy, and extra secure data.
You’re still responsible for doing your due diligence when choosing any tool to which you’re going to give access to your most sensitive information.
Here are a few tips to help make sure you know what you’re signing up for — and that it’s safe to use.
Check out Independent Reviews
Independent reviews are ones that don’t come from the company that provides the app or anyone who was compensated in some way to provide the review.
When you’re reading reviews about a financial tracker, you’re looking to see if any users have uncovered concerns with the terms and conditions, experienced a security hiccup, or exposed other red flags that might point to breaches or usability issues in the future.
Read Everything You Sign
It’s tedious, but reading the terms and conditions before you give a financial app your information is the only way you’re truly going to know how a (truthful) organization is going to treat and use your data.
And it’s not necessarily the end of the world if they’re going to use your information to their benefit — what matters is that they’re transparent about it and that you’re comfortable with it.
Since this kind of documentation can be hard to wade through, we recommend using a keyboard shortcut to search for terms like “sell,” “share,” “third-party,” and others that pertain to the information you want to know.
If there are no terms and conditions to read, don’t take the risk — move on to another app that has a shred of respect for itself and its users.
Look for Robust Security Features
In our opinion, tools that deal with people’s sensitive financial information need to provide the same security precautions that financial institutions do.
This means encryption, two-factor authentication, sign-in notifications that can alert you if someone tries to get into your account, and so on.
A financial app that partners with third-parties and therefore doesn’t have or save access to your credentials might help keep your data even more secure.
When You’re Ready for an Affordable, Secure Financial Tracking App: Kubera
Kubera is different from Personal Capital, Mint, and other money management tools in a number of ways.
First, it’s one of the few financial tracking apps that enables users to monitor and optimize a variety of asset classes — from traditional (stocks) to physical (homes) to digital (cryptocurrency) — across a variety of currencies.
Users can add tickers for individual stocks or cryptocurrencies to their Kubera dashboards to keep an eye on the market. And if you want to track homes, vehicles, or web domains using Kubera, our integrations with leading asset experts (such as Zillow in the U.S.) will keep your dashboard up to date with the real-time market value of your largest investments.
And you can see it all with Kubera’s beautifully-designed charts that help users track investment success, asset allocation, and how your net worth is growing.
In addition to these features, Kubera also takes its customers’ privacy and security seriously.
Kubera’s bank-level security measures employ cutting-edge encryption, apply two-factor authentication, and keep customer credentials safe through our partnership with industry-leading third-party aggregation services.
Then there’s our simple, affordable subscription fee that enables us to stay in business without selling your private data the way other financial tracking apps do.