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Automatic savings apps

Automatic savings apps

What they are, how they work & our top picks

Chris Owen
Chris Owen | Edited by Helen Saxon
Updated 1 July 2022

Autosaving apps use clever tech to work out what you can afford to save and then do it for you, automatically – moving money from your bank account to a virtual savings account. The idea is that you start building up savings without really noticing the cash is going. We've everything you need to know and all the top picks below.

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Top autosaving apps

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Who's this guide for? Anyone wanting to try an automatic savings app that can help you get into the savings habit.

Not what you want? Other related guides...

App-based banking | Best bank accounts | Top savings accounts

What are autosaving apps?

These 'autosaving' apps try to squirrel away some of your cash without you noticing – useful if you find it difficult to put money aside or don't know how to start saving.

Some calculate how much you can afford to save each week and automatically move money into a separate savings (or investment) account, while others 'round up' your purchases to the nearest pound and save the change for you. In theory, these features should help you save without having to think about it, leading to higher savings building up.

If you're feeling the pinch, you can always tell the app to save less, or withdraw the money back into your current account if you need it.

Yet while these apps can help you save more, most interest rates they offer can be beaten elsewhere – to max returns on existing savings, see our Top Savings Accounts guide.

The five autosaving app need-to-knows

To help you decide if an autosaving app is right for you, it's worth getting your head around the following need-to-knows...

  • 1. The apps use Open Banking – which banks now have to support

    The apps below require you to give them access to your existing online banking, so they can see your current account (and sometimes your credit card) info. This allows them to calculate how much you can afford to save.

    Depending on the app, and which bank you use, you may sometimes need to give the app your login details so it can access your data. And because of a regulation snappily called 'the second payment services directive' (PSD2) and reforms to the banking industry called Open Banking...

    ... banks must share your banking data with authorised third parties if you've given permission

    By 'authorised' we mean those third parties, such as apps, which have special licences from the Financial Conduct Authority (FCA) or other European regulators – see our Open Banking explained guide for more. Banks may still share your info with unauthorised firms if they choose to. However, if you choose to do this with an unauthorised firm or app, you may be liable for any fraud affecting your bank account.

    We note in the details for each app below if it is authorised to provide these 'account information services'. If you find one that isn't, you need to decide whether or not you're happy to take on the extra risk.

    Quick question

    • What if I use an unauthorised app?

      If you use a third-party provider that's not authorised, you won't get the same levels of protection against fraud. So if you lose money through it, your bank may not pay out.

      You should always check a provider before you give it access to your accounts – you can do so on the FCA Register or the Open Banking register. If it's not authorised, ask what security measures it has in place.

      However, if you're happy with a provider, you can choose to give it access even if it's not authorised, but you need to be aware of extra risks.

      We asked the FCA what you should do if you have doubts about a provider. It said: "If you're unsure about whether a company is legitimate, you should ask them for more information, for example, who they are regulated by.

      "If you don't know who you are talking to, or there is reason to suspect that the provider is not who they claim to be, don't disclose your banking security credentials or other personal or financial information."

      Bear in mind too that using a firm that's yet to be authorised doesn't automatically mean you're not protected – some apps already adhere to other regulations, such as the e-money regulations, which means your money is safeguarded.

  • 2. Your money's not always protected in the same way as a traditional bank

    When it comes to your finances, you want to be sure your money's safe – so it's important to understand how your money's protected. UK-regulated banks such as Barclays and NatWest have the full £85,000 Financial Services Compensation Scheme (FSCS) protection (see more on this in our Savings safety guide).

    Some of the apps below also have FSCS coverage, but others don't. Instead, many autosaving apps have an 'electronic money' licence. This means they have to hold your cash in a bank account ring-fenced from their operating cash – this is normally with a big bank such as Barclays or NatWest.

    Should the digital bank go bust, assuming it's done things by the book, your money would be protected as it'd be in a different account to the firm's own money.

    But there's an important caveat. If the bank or building society in which your money was ring-fenced went bust, your money may NOT be protected. This is because it's not counted as a deposit, in the way that cash in a savings account would be, and so it's not as clear-cut – the FSCS has told us that it would have to decide on a case-by-base basis whether or not it would cover your cash.

    For providers in this guide, we tell you how your money's protected – it's up to you whether you want to take the risk of a big bank that's holding your money going under.

  • 3. You can invest through these apps, but there's risk involved and much cheaper alternatives

    The apps below also allow you to invest the cash they put away in collective investments called funds. This can be tempting if you want the possibility of growing your money faster, but it's important to understand that investing is risky – you'll be subject to market fluctuations, and if your investments do badly you could lose money.

    This is why, as a rule of thumb, you should be looking to invest in funds or shares for at least five years – enough time to ride out any bumps in the stock market that might see you make a loss. If you can't invest for this long, it may be best to avoid it altogether. 

    There are much cheaper alternatives

    If your primary aim is to use these apps for investing, you should look elsewhere as the range of funds offered is limited and the fees are relatively costly. 

    See our Fund need-to-knows guide for full help, including our top-pick trading platforms which are much cheaper than these apps. 

  • 4. Sweep autosaved cash into normal savings to boost returns

    Autosaving apps are an easy way to get into the savings habit, but they generally offer little or no interest. Plus money left sitting in an autosave wallet may not have the strongest protection (see point 2 above).

    So unless you've chosen to invest, we'd suggest that every few months you move the money out into a normal top savings account (or at least check if a better rate is available) to get the best possible returns.

    Once you've gotten a feel for how much you can put away each month, it's also worth considering a regular savings account – these pay the highest interest on smaller sums.

  • 5. App-only bank accounts have more budgeting features

    The apps featured in this guide have a single purpose – to help you build up a savings pot without having to think about it. But if you're looking for more comprehensive help with managing your money, there's a different category of apps which could suit you better.

    App-only banks have a whole host of features meant to help keep your finances in check. For example, they give you real-time notifications when you spend or save, offer insights into your spending habits and let you sort your money into virtual piggybanks. They even offer some automatic saving features (for example, they can round up purchases to the nearest pound and put the change away for savings).

    By giving you more visibility and control over your cash, these features could prove more effective in helping you save in the long run. See our Digital banking guide for full info.

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Top autosaving apps

If you want to try an app to help you get saving, our top picks are below. Do note all these apps also offer investments as well as savings, so make sure you're signing up to a savings plan – if that's what you want. If you do want to invest, these apps aren't usually the cheapest way (see Investing for beginners for more). 

Automatic savings apps – our review

If you're looking to save little and often, most would be better off with a straightforward regular savings account, which would pay more interest. However, if you've tried that and it doesn't work for you, or you don't know how much you can afford to save, it's worth trying one of these apps. 

Our top pick is the default free plan from Chip, as you get its autosaving tech and an OK interest rate – it's partnered with Allica Bank to offer an easy-access account paying 1.05%, with unlimited withdrawals. Though to max your return, you can transfer the cash out of the app and into a top savings account.

You give it 'read-only' access to your current account via Open Banking (most major banks are supported) and it uses its algorithm to analyse your spending and work out how much you can afford to save. It does this every few days, automatically transferring the money into one of its accounts – make sure to open the Allica account and set it as your 'autosave allocation' in the app to boost returns. You can ramp up or down how much it saves each time, make manual saves and/or pause autosaves for up to three months.

Plum's Basic plan also offers a similar autosave feature to Chip, plus the option to round up purchases made from your linked bank account to the nearest pound. It then saves the difference (for example, 80p on a £2.20 spend), which it collects weekly. Your savings are initially held in your Plum account paying no interest, but you can move it to its easy-access 'interest pocket' at 0.5% or out of the app into a top savings account for higher rates.

Alternatively, the Chase bank account offers a similar 'round-up' option to Plum, but you need to spend on Chase's debit card to benefit from this. However, it moves any round-up amount to an easy-access account paying a whopping 5% – though it moves the 'round up' balance to another account (of your choice) each year, so the 'round ups' start from scratch. You can also activate 1% cashback on almost all spending for a year.

Top fee-free autosaving apps

Provider Features Interest rate (AER variable)
 Min/max deposit Max FSCS protection
Chip Autosave 1.05% on Allica Bank's easy-access account £1/ £85,000 £85,000, shared with Allica Bank
Plum Basic* Autosave and round-ups 0.5% on 'interest pockets' No min/ no max £85,000 on interest pockets, shared with Investec

Chase*

 Round-ups 5% – though the total gets moved to another account (of your choice) each year No min/ no max £85,000, shared with JP Morgan

Important: The Financial Services Compensation Scheme protection listed is for the interest-paying accounts stated above. Money deposited outside of these may not be covered, or the protection provided by or shared with a different bank. For example, money you deposit in Plum is instead ring-fenced in a different bank account (it uses the Bank of England), so if there are problems with Plum, your money's safe. This would be the case in this scenario as long as the bank itself still existed.

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