August 29, 2018

Qapital Review: Is It Safe?

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Do you spend your money before you even have a chance to save it? Enter Qapital, the mobile app that "forces" you to save by rounding up your purchases or following rules you've chosen. While you won't get rich quick with this app, it can be good for beginning savers.

Overall Score

4.3

Annual Fee

5.0

Minimum Deposit

5.0

Customer Service

3.0
5-point scale (the higher, the better)

Pros and Cons

  • No service fees
  • No minimum balance
  • Rules-triggered savings
  • No interest
  • Only available on a smartphone
  • No phone support

Bottom Line

Free mobile app that makes saving money fun and automatic with customizable rules. Good for those who have trouble saving

Qapital began to help make saving easy and fun. It's no longer about sacrificing certain habits. Instead, they put the focus on goals and passive saving. You are in the driver's seat as to how much and when you save. Qapital then does the rest for you.

As long as you are 18 years or older, all you need to get started is a US-based checking account. You don't even need a minimum deposit to get started. Just open your account, start spending, and watch the savings trickle into your account.

Keep reading to learn if Qapital lives up to its hype.

How Qapital Works

After you open your Qapital account, which you do on your smartphone only, you connect your US-based checking account to use for funding. Keep in mind that you can only link a checking account. This is what Qapital uses to transfer funds when you trigger a rule. They also use it to deposit your withdrawn funds once you've reached a goal.

Once you set up your funding account, you can set up "goals" and "rules." Your goals are what you are trying to save for, such as a vacation or wedding. Rules are the transactions that you make that trigger Qapital to transfer the designated funds to your Qapital account for saving.

Your rules are triggered by spending on your linked credit card accounts. Once you trigger a rule, you will add to your savings with Qapital. The funds come from your linked checking account, though, not the credit card used to make the purchase. Qapital offers a variety of rules, which we discuss in detail below.

Qapital does not hold your money themselves; your money sits in a partner bank in an FDIC-insured checking or savings account. These accounts are not your funding accounts. Your funding account is your current checking account at your bank; it doesn't have to be at one of Qapital's partner banks.

In addition to your Qapital Saving account, you can also set up a Spending account. With this account, you receive a Qapital Visa Debit card. You are free to make unlimited transfers between your Qapital Savings and Spending accounts. You can also set up direct deposit from your paycheck into your Spending account. In fact, opening a Spending account is the only way for you to earn (minimal) interest on your Qapital accounts.

What Are the Rules?

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Qapital offers four preset rules, but you have the option to make customized rules as well. The preset rules include:

  • Round-up rule: This is the most popular rule, as it "rounds up" your designated transactions, putting the difference in your savings account. You set the transactions that trigger the rule as well as the amount of the round up. Your increments must be to the nearest even multiple. For example, if your round-up rule is $4, a $3.50 purchase would round up to $4. A $5.50 purchase would round up to $6.

  • Set and forget it rule: You can pick specific days of the week or even one day a month to transfer a specific amount of money to a specific goal account. If you want weekly savings, you can set up "save $20 every Sunday," or you can set up a rule for "save $50 on the 1st of each month." You create the rules; they are not preset.

  • Spend less rule: You can reward yourself for spending less. For example, do you have a coffee shop habit? You can set a rule that every week that you spend less than $20 at the coffee shop, you save the difference in one of your goal accounts.

  • Guilty pleasure rule: Do you have a habit you consider a "guilty pleasure"? You can try to curb those habits by setting up the guilty pleasure rule. Either way, you win with this rule. If you give into your guilty habit, you trigger a rule and add to your savings account. This may make you think twice about that habit. If you avoid the habit, you have more money that you can set aside for your goals.

If these rules don't speak to you or you have another "unique" rule you'd like to implement, you can set up your customized rules in the app.

What Are the Fees?

Qapital doesn't have a minimum balance fee, usage fee, or monthly service charge. The app is free to download, and you don't pay a fee to set up your account.

You may, however, pay fees if you choose the Qapital Spending account and use your Qapital Visa Debit card at the ATM. The fee varies by bank. They also charge a foreign transaction fee for charges made overseas.

How Does Qapital Make Money?

Qapital makes money from Visa when users swipe their Visa card. Visa charges retailers a small fee for accepting their card. Visa then gives Qapital a small cut of that fee for each Qapital Visa card transaction.

How Do You Get Your Money?

You are free to withdraw your funds at any point. You don't have to wait until you hit a goal, but that's the obvious intention with this account. You can trigger the withdrawal by requesting the amount to be sent back to your funding account. You can also transfer the funds to your Spending account and use your Visa debit card to withdraw and/or use the funds.

Qapital doesn't charge a fee to withdraw funds, even if you withdraw them before you reach your goal.

Is Qapital Safe?
Qapital takes your safety seriously. They claim they don't sell your information to third parties. They also offer data encryption for information communicated via the app as well as with their partner banks.

Your funds are protected by FDIC insurance through the partner bank. You are protected for up to $250,000 on all accounts combined. This protects you should Qapital or the partner bank go out of business. The insurance is not issued by Qapital, but rather by the partner bank.

Reasons We Like Qapital

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  • You can save without thinking about it. Mindless savings makes it easier to save, even if it's $2 at a time. With the minimal effort required, you can see the savings add up by monitoring your account via the app.

  • They have a Failsafe Mechanism that may help you avoid overdrafts in your funding account. Qapital helps you avoid overdraft fees by halting transfers from your funding account if the balance is less than $100 in that account. Qapital pauses the rules until your funding account has a balance exceeding $100. This isn't a fail-proof model, but it does minimize the risk of overdraft fees.

  • You can use the "If this, then that" rule. These rules apply to many different areas of your life. Are you a social media user? Set up a rule that whenever you tweet, you make a deposit into your Qapital account. Do you go to the gym? You can set up a rule to save every time you step foot in the gym. The IFTTT rules are endless and can make savings fun.

  • You can set up multiple savings goals. Some microsavings apps restrict you to one goal at a time. Qapital allows you to set up multiple goals and assign rules to them accordingly. You can even assign the same rule to multiple goals.

  • You won't pay a transfer fee to take your money. Qapital doesn't charge a fee to take your money, even if you take it prior to hitting your goal. This could be looked at either way, though. It could be a downside since you have access to your funds before reaching your goal, but it's also good to know you can access the funds in an emergency, fee free.

  • You can use your existing bank account as your funding account. You don't have to go through the hassle of opening up another bank account at a Qapital partner bank.

  • You can link many different credit cards to trigger your "rules." As long as the credit card is bank issued, you can link it to your rules. You may also use American Express cards and PayPal accounts.

  • You can set up recurring transfers outside of your "rules." If you prefer preset savings transfers, you can set those up as well. You can also conduct manual transfers when you have extra money.

  • You can set up direct deposit into your Spending Account. You can designate all or part of your paycheck to hit your Spending account. From there, you can transfer the funds to your savings account automatically. This can help increase your savings even though you have to make the transfer to the goals account.

  • You can pay yourself for giving into guilty pleasures. Are you stuck in a habit you'd love to kick? "Penalize" yourself by having money taken from your checking account and put into your goals account every time you give into the habit. It's a rewarding punishment.

You Can Pay Bills with Qapital
While Qapital is meant as a savings mechanism to help you reach your goals, you can write a check from your Spending account. Just click on "Transfers" in the app and choose "Pay Bills." From there, you can choose to have Qapital send a paper check on your behalf.

Reasons You May Want to Look Elsewhere

  • It can take up to 10 business days for the round-up feature to start. Your rules may not start immediately. It can take as many as 10 days to get all parties on board with the round-up rule. It's not just Qapital, but also your funding bank and your credit card that need to be figured into the transaction.

  • You only earn interest if you have a Spending Account. Granted, the interest you earn is minimal, but every little bit counts. If you don't have a Spending Account, your savings sit in the account interest free.

  • Qapital is only available on your smartphone. Qapital started as a way to make savings easy, which is why they only offer a smartphone app. You can't access your accounts online on a PC.

How It Compares

Digit:
Digit makes savings automatic by evaluating your accounts and determining how much you can afford to save. You set up goals and Digit decides how much you can afford to save towards those goals on an ongoing basis. You save when you can afford to and back off when it's not feasible. Digit does charge a monthly fee, whereas Qapital is free.

 

Qapital

Digit

 

Benefits and Features

Annual Fee
$0
30 days free; then $2.99/month
Checking
Yes
No
Online Platform
No
Yes

Qapital: Pricing information from published website as of 07/02/2018

Digit: Pricing information from published website as of 07/02/2018

Acorns:
Acorns is an investment account, rather than a savings account like Qapital. Acorns sweeps your spare change into your Acorns account and invests your money once you accumulate $5. You'll invest in ETFs and pay a small monthly fee for the service.

 

Qapital

Acorns

 

Benefits and Features

Stock Trading Part of service fee. Free for college students for 4 years. No add-on trading fees.
Savings
Yes
No
Annual Fee
$0
Free for college students; $1/mo for Acorns; $2/mo for Acorns + Acorns Later; $3/mo for Acorns + Acorns Later + Acorns Spend
Phone Support
No
Yes
Online Platform
No
Yes
Banking Acorns Spend checking account comes with a debit card and has no minimum balance requirement, no overdraft fees, and unlimited free or fee-reimbursed ATMs nationwide. $3/mo for Acorns + Acorns Later + Acorns Spend.
Taxable Accounts
No
Yes
IRA Accounts
No
Yes
Roth IRA Accounts
No
Yes
SEP IRA Accounts
No
Yes
 Visit Site

Qapital: Pricing information from published website as of 07/02/2018

Acorns: Pricing information from published website as of 04/04/2018

Chime:
Chime is an online bank with the benefit of an automatic savings program if you opt-in to the savings account. It's mainly a checking account, but the Chime Savings option offers a round-up rule that rounds your purchases made with your Chime Visa to the nearest dollar, saving the spare change for you.

Bottom Line

If you've yet to figure out how to make savings a habit, Qapital can get you on the right track. With minimal fees and multiple ways to set up your rules, it can make savings a habit rather than a chore. While you won't make much in the way of interest, if it stops you from needlessly spending or ignoring the need to save, Qapital may be the help you need.

Disclaimer: Opinions expressed here are author's alone. Please support CreditDonkey on our mission to help you make savvy decisions. Our free online service is made possible through financial relationships with some of the products and services mentioned on this site. We may receive compensation if you shop through links in our content.

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