Monday, 20 January 2020

Twine App Review: Savings Goals for Couples

Twine App Review: Savings Goals for Couples
10 Jan
12:10

Twine is a money management app for couples. With Twine, you and your partner set financial goals together and reach them by saving money or investing in the stock market — or both.

Combining finances with a partner can be tricky, but the process is easier when you can clearly track how much each person is contributing and track your progress as a team. We took a deep dive into Twine to see how the app stacks up.

What is the Twine app?

With Twine, you and your partner save and invest money to make progress towards common financial goals. Twine is owned by financial services giant, John Hancock.

To get started, you and your partner connect your bank accounts to the Twine app. Then you set up one or more common goals, which are funded by recurring deposits from your bank accounts into Twine’s savings account or investing account. The app calculates an estimated date when you’ll reach the goals you’ve established, based on the amount of your recurring deposits and the returns from the savings and investing accounts.

If you opt for the savings account route, you’ll earn 0.63% APY on the money you stash away. With the investing route, market returns dictate how much you earn. You can withdraw your funds from either account type at any time; withdrawals from savings take two to three business days, while withdrawals from investing accounts take 7 to 10 business days.

Whichever route you decide on, Twine creates separate accounts for you and your partner, but your deposits are funneled toward the same goals. Twine does not have any requirements concerning who you can team up with — as long as both users are 18 or older, you’re good to go.

Twine’s fees and features

There are no fees for Twine’s savings account product, which earns 0.63% APY. However, Twine charges a fee of 0.60% of your investing account’s average daily balance, to be paid out per month.

Customized goals

The app enables you to save for one or more goals, like a vacation, wedding, home down payment, children or even just general savings. You and your partner set a target amount for each goal, and then set up monthly deposit amounts.

Twine makes weekly recurring installments (the amount is based on your monthly contribution), and the money is moved from your linked bank account to your Twine account. The app will then provide you with estimated projections as to what date you should reach your goal.

Joint investing

When you choose the investing option, Twine creates separate brokerage accounts for you and your partner with John Hancock.

Twine’s investing feature offers conservative, moderate and aggressive portfolios, made up of exchange traded funds (ETFs) and mutual funds. Twine recommends you choose an investment portfolio that’s in-line with your goals and risk tolerance.

No minimum balances or minimum deposit amounts are required, though there is also a custom portfolio option that requires a $100 minimum balance in your account. Investment accounts are protected by the SIPC up to the legal limit.

Cash savings account

Twine’s savings account currently pays 0.63% APY, although it cautions that its interest rates are variable and are adjusted with market interest rates. The app does not require any minimum deposits for its cash savings account, and you can withdraw your money at any time. Cash accounts are FDIC-insured up to the legal limit with deposit services provided by Apex Clearing Corporation.

Advantages of the Twine app

  • While the interest earned on cash savings is not much, many apps that serve as tools for money management offer no interest at all. In this case, something is better than nothing.
  • Twine offers FDIC-insurance, and doesn’t skimp on its approach to security by having guidance and protection from both parent company John Hancock and Apex Clearing Corporation, as well as encrypting your data.
  • Allowing you to track your financial goals as a couple — as opposed to blindly contributing to a joint account and reviewing statements to compare who is contributing what — simplifies the idea of joint money management and increases transparency.

Drawbacks of the Twine app

  • There aren’t any limitations as to which user can withdraw from the Twine Goal account, and withdrawals can happen at any time. You’ll want to trust the partner you’re sharing a goal with — theoretically, they could cash out the shared goal account and leave you with nothing. However, this is also the case for most joint accounts offered by traditional banks.
  • Compared to other, high-yield savings accounts, the interest offered by Twine is dismal. There are currently high-yield savings accounts listed on our site that are doling out over 2% APY.

Twine vs. other joint savings apps

Twine isn’t the first fintech company to take on joint money management. Here’s how it measures up to competitors Honeyfi and Honeydue.

Twine vs Honeyfi

  • Honeyfi includes more than just joint savings, which is Twine’s core feature. Instead, Honeyfi also has a joint budgeting feature, and allows you to track your spending as a team and split transactions.
  • Honeyfi has a feature similar to Twine’s goal-setting tool, where it allows you to create custom goals where both of you can contribute and track progress. However, Twine offers an investing route to reach your goals, while Honeyfi does not offer investing. Honeyfi also doesn’t pay out interest on your savings, and instead rewards you with a 1% annualized savings bonus, paid once every three months.
  • Honeyfi charges an annual fee of $60, while Twine is free to use.

Twine vs. Honeydue

  • Honeydue takes a more holistic approach to joint money management, and allows you to track your partner’s spending, budget together, coordinate bill payments, share expenses and track investments. At its core, Twine and Honeydue provide very different functions.
  • Honeydue has not launched its joint banking feature yet, and while it allows couples to manage their money together, they’re not actually sharing any new joint accounts within the app.
  • Like Twine, Honeydue is free to use.

Is Twine right for you?

Twine takes on the same job as a joint savings account or joint brokerage account, but it definitely streamlines and simplifies the process of joint money management. Being able to visually track your progress towards goals is helpful, and it’s easy to see who is contributing exactly what, which increases the transparency that is necessary when combining finances.

While the interest offered is weak, and Twine doesn’t offer money management tools outside of its core savings feature, this app is worth checking out if you’re looking for a tool to save towards a shared expense, like a wedding or vacation.

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Sarah Berger
Sarah Berger |

Sarah Berger is a writer at MagnifyMoney. You can email Sarah here

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Source: https://www.magnifymoney.com/blog/banking/twine-app-review/

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