Qoins Review: Eliminate Debt With Your Spare ChangeGetting Out of Debt
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Most of us dream of financial independence, but for many Americans the most significant roadblock on that journey is debt. Debt is bad for your credit, hampers your ability to save and invest, and takes a toll on your happiness and mental health.
Did You Know? The average American has $36,000 in debt, and these numbers are rising year after year. Indeed, many of us seem paralyzed by our debt, with no idea of how to how to pay off these seemingly insurmountable sums.
How Do You Pay Your Debt Off?
Paying off debt should be everyone’s number one priority, but it’s hard to know where to start. Many of us are on tight enough budgets as it is, and the prospect of paying off that looming debt seems daunting.
What if there was a way to pay off debt without making any significant change to our lifestyle or spending problems? A way to pay off our debts automatically without having to worry about it?
Thankfully, there is such a way, and it comes it the form of a smartphone app called Qoins.
This Qoins review will explain how the app works, detail how to get signed up and set up your account, and explain the fees. Finally, we’ll sum up our thoughts and evaluate if Qoins is a legitimate and effective way to pay off your debts.
What is Qoins?
Qoins is a penny-rounding app designed to help you pay off your debts.
If you aren’t familiar with penny-rounding apps such as Worthy Bonds, let us explain exactly how they work. A penny-rounding app will monitor spending on your “funding account”, which is any account which you usually use to make daily purchases.
Every time you make a purchase, the app checks how much you spent. If there are any cents in the charge, the app will round the charge up to the nearest dollar and save the rounded-up cents in a separate savings account.
Per Example: Let’s say you fill up your gas tank for $22.50. Qoins will round the charge up to $23.00 and save the extra $0.50 that was added. Once the app has added up $5 worth of change this way, it will transfer the money to a special savings account managed by the app. The money in this account will then be used to pay off your creditors and eliminate your debts. It’s as simple as that. Just spend as you normally would, and the app will collect the spare change and put it towards paying down your debts.
Not Your Typical Penny-Rounding App
If Qoins sounds familiar, that’s probably because you just read our recent review of Acorns. Acorns is an investment app that operates on a similar principle: rounding up transactions and pocketing the change.
So what’s the difference between Qoins vs Acorns? Namely the difference is that Acorns uses the extra money to invest into the stock market and create and portfolio for you, whereas Qoins uses the money to pay off your debts.
Another popular app of this type is called ChangeED. What about Qoins vs ChangED? ChangED also uses penny-rounding to help users pay their debts, but as the name implies, ChangeED is specifically focused on paying down student loans.
Good to Know: Qoins, on the other hand, can be used to pay down nearly any kind of debt (including student loan debt!) whereas ChangeED is only limited to student loans. Therefore, as long you don’t mind paying the slightly higher fee for Qoins ($1.99 vs $1.00), it’s clearly the superior choice if you want to use a penny-rounding app to pay off your debt.
As we mentioned in our review, Acorns is an excellent way to get started in investing with all the same benefits as Qoins.
Used together, these two apps can help you build your wealth and achieve financial independence with minimal hassle.
In this next part of our Qoins review, we’ll explain how to set up your profile and link your accounts. There are only two simple requirements to open a Qoins account: you possess a checking account from a U.S. bank or credit union and you’re over 18 years of age.
Good to Know: At the moment, Qoins is only available for users in the United States. To get started, just search for Qoins on the App Store or Google Play store and download the app. When you first fire up the app, it will ask for your name, phone number, e-mail and the details for linking your checking account which will be used for the rounding transactions, otherwise called your “funding” account.
How Does It Actually Work?
Qoins will verify your account by depositing two very small amounts into your funding account. You’ll need to confirm those exact cent amounts with the app in order to complete the verification process. This verification procedure should be familiar to you if you’ve set up a PayPal or similar digital currency management account before. For most users, the verification only takes a few days.
Pro Tip: While you need at least one checking account linked to set up your Qoins account, you can add more than one account. You can even add credit card accounts as well. Basically, whatever account you do the most spending on would be the best candidate for linking to your Qoins account. The more transactions you have on the account, the more change will be rounded, and the more debt you’ll pay off.
You Make the Rules
Qoins has an interesting feature which many users will no doubt enjoy, that is the ability to decide rules for when and how the app will make payments to your creditors.
By default, Qoins operates on a monthly cycle. Every time your rounded-up cents reach $5, that amount will be put into your Qoins account and held until the end of your monthly cycle. At the end of the cycle, Qoins will automatically take the accumulated sum and pay it directly to your creditor.
Great Pro Argument: What’s great is that users can choose the dates for their monthly cycle. Pick the date you want, and your accumulated change will be sent off on that date. Alternatively, users can set the app to automatically deposit your Qoins balance once it reaches a specified threshold.
Per Example: Say for example you set your threshold at $10. That means as soon as your Qoins balance reaches this amount, it will automatically be sent to your creditor. This means payments could be made several times a month instead of just waiting for the end of your monthly cycle.
This flexibility gives users the option to customize their debt repayments to whatever works best for them. Many users will appreciate this added functionality.
Paying Off Debts
Of course, the main purpose of Qoins is paying off your debt, helping you be more financially independent and take control of your finances, so our Qoins review will now explain how exactly the debt repayment system works.
Pro Tip: In addition to your “funding” accounts, you’re going to want to add debt accounts. These are accounts with creditors to whom you owe money. Add debt accounts in the “payment rules” tab by entering all the necessary information, including the debt holder’s address and your account number.
To make things easier for users, the app has a built-in database of contact information for some of the most commonly used loan and credit card providers. Chances are you’ll be able to find your creditor in the app itself.
Good to Know: If you can’t find your creditor it in-app, don’t worry, there is an option to enter your loan provider’s information manually. If you’re not sure what to enter, try looking on your last statement from that creditor, as it should have all the information you need printed clearly on the statement.
Is The Qoins App Safe?
Some of may be wondering: is Qoins app safe? In this digital age we should always be vigilant that our data is properly protected. If you’re handing over your banking information to an app, you need to know that your data and your money is properly secured.
Qoins uses industry-standard, 256-bit encryption practices to ensure that any data of yours which passes through the app is 100% protected. Banking information is never stored on their physical servers.
Interesting Fact: The Qoins savings account that holds your money is FDIC-insured. That means your deposit is insured by the federal government for up to $250,000, so you can rest easy knowing that your hard-earned money is secure. Additionally, Qoins has a payment guarantee, meaning that if your payment isn’t processed correctly for any reason, it will be directly refunded back into your funding account.
Qoins has helped over 6,200 users to collectively pay off over $2 million in debt, so it’s safe to say that Qoins can be trusted with your data and money.
What About the Fees?
Fees are an area which many overlook when investing or using financial services, so it’s important to understand exactly how much you have to pay to use Qoins. Fortunately, the fees for Qoins are incredibly straightforward, and very low: $1.99 per month. That’s it.
This balance is subtracted from your Qoins balance, never from your checking account! The fee comes out at the end of your monthly cycle and is subtracted before the check is sent to your creditor. So, if you finish the month with $50 in your Qoins account, your creditor will receive $48.01.
Keep in mind that the minimum amount that will be taken from your funding account is $5. If you don’t use that account during the month, or don’t reach the $5 limit, there will be no monthly payment, thus no fee will be taken.
Since the fee is fixed, it’s easy to calculate the expense ratio of the fee. Basically the more activity you have on your funding account and the more change you accumulate in your Qoins account, the better the expense ratio becomes.
Pro Tip: If your monthly debt payment is only $10, a $1.99 fee represents 19.9% expense ratio, which is fairly high. However, according to Qoins CEO Christian Zimmerman, the average Qoins user accumulates $50 per month.
Good to Know: A deposit of $50 has an expense ratio 3.9% which is quite low. More activity on your account will not only help you pay down your debt faster, but also keep the expense ratio of the fee as low as possible.
Our Qoins review has summarized everything you need to know about this debt repayment app. So it Qoins worth it? If you have any outstanding debts at all, Qoins is absolutely a great way to help you pay those debts off.
With a very low monthly fee and a “set-it-and-forget-it” functionality, Qoins will help just about anyone to contribute more to their debt repayments without changing their lifestyle or spending habits significantly.
Per Example: Consider an individual who has a debt of $6000 with an interest rate of 20% and monthly minimum payments of $200. By paying only the minimum payment, it would take that individual 43 months to pay off that debt, having paid $2365 in interest by the end. Ouch! If this same individual were using Qoins and contributed the average of $50 per month through the app, their debt would be settled in 32 months having paid $2212 in interest. That’s a savings of over $150 in interest and their debt would be gone 11 months sooner!
The math doesn’t lie, Qoins can have a significant impact on your debts for very little fee and hassle. In the above example, it eliminated the debt almost a year earlier: that’s a lot of peace of mind.
Qoins is the best way to help pay down your debts, get your life back on track, and start saving money so you can begin planning for your financial future.
Logan is a practicing CPA, Certified Student Loan Professional, and founder of Money Done Right, which he launched in July 2017. After spending nearly a decade in the corporate world helping big businesses save money, he launched his blog with the goal of helping everyday Americans earn, save, and invest more money. Learn more about Logan.