(Adds details of CEO and app)
By Beth Pinsker
NEW YORK, June 11 Struggling to get out of
credit card debt he accumulated in college, Rion Robinson tried
a lot of different approaches to curb his spending, from
old-fashioned spreadsheets to money management programs like
None of them worked.
Then Robinson, a 27-year-old who works for a medical
supplier in Columbus, Ohio, tried the Level Money budgeting app.
He was out of debt six months later.
Level, which launched last fall, is aimed at millennials
with their relatively straightforward finances and reliance on
digital technology. It tries to distill budgeting to just one
number: what discretionary money you have available to spend.
For Robinson, it was $17.57 a day.
"I checked it every day, sometimes multiple times a day," he
says. "It made it real for me."
Robinson is not the only person to feel separate from the
physical presence of money.
"We've lost the ability to just look in our wallets and see
how much is left," says Level founder and chief executive
officer Jake Fuentes. The company does not disclose how many
users it has, but says the app has been downloaded more than
Because of Level, Robinson gave up his $3 latte because he
could finally see how it crimped his grocery budget. He also
gave up buying music from iTunes and switched to a free online
streaming service. And he dropped a package of cable channels.
Getting to a daily spending number is not easy math, which
is why most budgeting programs only analyze previous spending.
But companies like Mint, with 15 million users, and major banks
like Wells Fargo & Co are also working on ways to spin
While many bills and income payments are regular, others are
not as easy to track. "Spending can be lumpy," says Brett Pitts,
Wells Fargo's head of product management for the digital
channels group. "And just tracking cash flow for the sake of it
is too small a frame."
The problem: Most money management programs only look back a
couple of months when users get started and may not capture
upcoming quarterly water or tax bills, one-time lump-sum
payments like tuition for summer camp or school, or
unpredictable expenses like car repairs. Bills that are split
with others also need to be apportioned.
Feeding in all the data required to make a reliable
calculation can be an onerous task. Mint has found that only
about 20 percent of Americans will take the time to quantify
Vince Maniago, group product manager for Mint, a division of
Intuit Inc, says his team is working on a solution to
the daily spending question. He thinks it will take about a year
to work out all the kinks.
Users want it, he says, but they just do not want to do the
work to get it. "It's like wanting to eat kale and quinoa, but
instead we don't," he says.
Wells Fargo is testing solutions that go beyond just
providing a balance update. Many of the bank's customers check
their accounts from lines at the store to make sure they have
enough to cover purchases. But account balances do not factor in
upcoming withdrawals so that if you buy groceries today, you may
be slapped with an overdraft fee tomorrow when the gas bill gets
"The challenge with checking your balance every day is a
false signal," says Steve Wendel, principal scientist for
HelloWallet.com, a financial analysis service now owned by
The way to get people more engaged is to ask very little of
them, Wendel says. A few push alerts to warn about low balances
or big upcoming bills will do it, but more than that just
That was definitely the case with Jessica Flaherty, a
30-year-old from Lewiston, Maine, who was mired in law school
debt. Flaherty did not want to deal with her problems, so she
just ignored them and turned off her phone to bill collectors.
When she finally decided in February that she needed to do
something, she did not focus on a daily spending number.
"I did not have a number to spend in a day," she says. "I
had a negative number."
Instead, she set up an account at Mint, fed in all of her
information and set up a goal to pay off her debt. A pop-up told
her there was no way to do it.
Flaherty found some things to sell and was able to pay down
her highest-interest loans, cutting her monthly payments from
$1,000 to $500. She also got a job as a volunteer coordinator at
a local library.
Since then, Flaherty has not been late making loan payments.
Spending changes are harder: "I have not succeeded in the coffee
budget," she admits.
Still, Flaherty says she feels more in control of her
"I try to be more on top of it," she says, "and not beat
myself up when I fail."
(Editing by Lauren Young, Lisa Von Ahn and Bernard Orr)