Avast Blog_Tips & Advices: Are budget-tracking apps safe?

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An app that helps manage your finances could be useful, but is your data secure?

These days, it seems like the next security breach is always lurking just around the corner. Whether it’s the latest Facebook password kerfuffle or a company’s credit card database being breached, news stories of innocent people’s data being exposed abound. That’s why it’s best practice to guard your personal — and especially, financial — information very carefully. But what if you’re one of the millions of people out there who could use a little help sticking to a budget?

Budgeting apps provide the convenience of all your financial data in one place, so you can easily monitor your spending. But in this climate of data insecurity, you may be wondering if it’s safe to hand over all of your financial data to an app.

It’s a good question, and one that has to be considered before setting up any budget tracking software. The good news is that it’s not as dangerous as you might think, provided you use a reputable budget tracker. We give a few suggestions below. But first, let’s look at what kind of info you’re sharing with the app and where that info lives.

In a nutshell, you’re sharing details of your credit card accounts and bank accounts. Some apps also work with other sources of income, such as stocks and investment funds. These apps will then sync with your online banking and other accounts periodically, to keep your budget up-to-date in the app. However, the apps just have “read-only” access, meaning they can see your financial activity — but can’t make any changes (like transferring money without your consent). Once they have your information, budgeting apps typically store that data on their own company servers. This is a security measure, for if someone were to steal your phone and open the budgeting app, they would not have access to your full information. The app will show your budget (things like purchases, bills, etc.) but not any of your bank login data. So if someone were to hack into your app, they still wouldn’t be able to hack into your actual bank account.

Still, you want to be smart when dealing with any money matters, so here are some best-practices for using these handy apps:

Tips for using a budgeting app

1. Check the privacy statement — Before you decide on the app, look at its privacy statement. These can sometimes be long and full of legal jargon, so it’s a good idea to search the word “sell” or “share” in the privacy statement. Then you can easily check to make sure the app won’t sell your personal data to third-parties for targeted ads. If the app doesn’t have a privacy statement at all, find another app.

2. Check the app’s security level. These apps deal with your financial information, so they should be using financial institution-level security measures. Look for the app’s encryption standards for user data (128-bit is good; 256-bit is better) and see if it has two-factor authentication as a login option for you (it’ll add an extra layer of security on top of your password).

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