Moka App Review: Is This Automated-Savings App Worth It?
Canadians are increasingly turning to fintech apps to help them manage their finances. An alternative to traditional banks and credit unions, fintech companies offer unique products that can help you create budgets, build your credit, track your spending, pay down debt, and save money.
One such fintech is Moka, an app that makes it easy to save by rounding up your credit and debit card purchases to the nearest dollar and setting aside the extra into an investment account.
In this Moka review, I’ll cover everything you need to know about the app to help you determine whether Moka is right for you.
What Is Moka?
Moka is an automated savings and investing app designed to help Canadians, particularly Canadian millennials, reach their financial goals faster. The fintech, formerly known as Mylo, was launched in 2017 and was acquired by another Canadian fintech, MOGO, in May 2021.
How Does Moka Work?
At the heart of the Moka app is a round-up savings feature that allows you to invest your spare change in a diversified portfolio.
When you open an account with Moka, you’ll link a valid bank account and your debit/credit cards to the app. Then, every time you make a purchase, Moka rounds up the transaction amount to the nearest dollar and sets aside the difference. For example, if you buy a coffee for $2.75, Moka would round the purchase up to $3 and save the $0.25 as your spare change.
In addition to the round-up feature, you can also set up a fixed transfer amount from your bank to Moka. If you’ve been struggling to set money aside, Moka can make things a lot easier for you.
How Does Moka Invest Your Money?
Moka invests your money in a diverse portfolio of exchange-traded funds (ETFs). They also offer a socially responsible investing option (SRI) through the Moka SRI Fund. Moka portfolios are managed by a team of portfolio managers at Mogo Asset Management Inc., which is a subsidiary of Mogo Financial Technologies.
You have the option of opening a registered (TFSA or RRSP) or non-registered account with Moka. There’s no minimum investment required, so you can start with just your spare change.
Moka’s investment portfolios are tailored to your risk profile, financial goals, and investment preferences. Moka will recommend one of the following portfolio types based on the information you provide:
- Cautious Income
- Balanced Income
- Balanced Growth
- Equity Growth
Each portfolio contains a combination of the following three funds, which are comprised of several low-cost ETFs from well-known fund companies such as Vanguard, BMO, Horizons, and Purpose.
- Moka Money Market ETF Fund
- Moka Fixed Income ETF Fund
- Moka Equity ETF Fund
Socially Responsible Investing Portfolios
Moka offers a socially responsible investing option for those who want to invest in accordance with their personal values. SRI investment funds focus on companies that meet high environmental, social, and governance (ESG) standards.
The Moka SRI Fund aims to provide long-term capital growth while investing in companies that address major global social and environmental challenges such as climate change, gender diversity in the workplace, corporate responsibility, and sustainable development.
How Much Does Moka Cost?
When you sign up with Moka, you can choose from two service plans, both of which charge a flat monthly fee. Here’s a closer look at the details of each plan:
Moka – $4.99/month
- Automated, round-up investing
- Fully-managed investment portfolios
- Access to Socially Responsible Investing options
- Moka will plant one tree for each new member
- Unlimited tax-free accounts (RRSP, TFSA)
- Cash back offers from Moka partner brands
- Round-Up to give to charity
Moka 360 – $15/month
Includes all of the original Moka features, plus:
- Access to a Moka financial advisor
- Customized debt planning
- Double cash back perks
- $99 discount on any Willful plan
Moka Pros and Cons
Round-up savings apps like Moka offer a unique savings option that most traditional financial institutions don’t provide. But is it worth paying the monthly fee? Here’s my list of Moka pros and cons:
- Makes saving money effortless
- Socially Responsible Investing option
- Tax-sheltered accounts available (tax-free savings account, registered retirement savings plan)
- Allows you to set specific savings goals and track your progress
- Invest your money in low-cost ETFs
- Access to financial advice if you need it (Moka 360)
- The monthly fee will eat into your investment returns
- Only three account types (RRSP, TFSA, non-registered)
- Unlike other fintechs, no high-interest savings account option
Moka vs. Wealthsimple Invest
Moka isn’t the only automated investing app in Canada. Many Canadians are familiar with another app called Wealthsimple Invest, which operates in a similar fashion. So which app is better?
Moka is designed for those who are looking for a simple way to help them reach a specific financial goal. For example, you might set up a Moka account to save for a new bike, a birthday gift for someone special, or an upcoming vacation. Moka’s focus on making saving and investing effortless is best suited for beginners with a shorter investment horizon.
Wealthsimple Invest offers a much more robust robo-advisor platform that is geared more towards long-term investors. They also offer several additional products and services that you can’t get with Moka, like a dedicated spending and savings account, a free stock trading app, crypto investing, and free tax return software.
Unlike Moka, Wealthsimple Invest doesn’t charge any monthly fees, just a management fee on assets under management. There are no fees for a Wealthsimple savings account.
If you’re looking for a simple savings app to help you reach your short-term spending goals, Moka is a solid choice. But if you’re looking for a more comprehensive banking alternative, Wealthsimple is the way to go.
Is Moka Legit?
Moka is definitely a legitimate app for Canadians looking to invest their spare change and work towards their financial goals. The company has been around since 2017 and is owned by Mogo Inc., which is a publicly traded fintech with more than 1 million members.
Is Moka Safe?
Moka employs the same security measures as Canadian banks, including 256-bit encryption, SSL connections, and strict internal security policies based on ISO standards. In addition, funds held in Moka TFSA and RRSP accounts are insured by the Canadian Investor Protection Fund (CIPF).
The Bottom Line on Moka
Moka makes it easy to save your spare change. I like that you can invest in various ETFs and create a customized investment strategy. And Moka supports RRSP, TFSA, and non-registered accounts, which will be enough to satisfy most beginner investors.
Moka’s biggest drawback is the monthly fee. When you compare the app to other fintechs and online banks offering free high-interest savings accounts, like Wealthsimple Invest, EQ Bank, and Neo Financial, Moka falls short. That said, if you don’t need another bank account, then you might find Moka’s convenient savings features to be well worth the $4/month.
Can you lose money with Moka?
Yes, it is possible to lose money with Moka, as the app invests your spare change in stocks and bonds as part of a personalized portfolio. Like any investment, there is always a certain level of risk involved. Remember that Mokoa’s is to help you grow your savings over time, but the value of your investments can fluctuate depending on market conditions.
How can I cancel a Moka subscription?
You can cancel your Moka subscription by tapping on the profile icon in the top-left corner of the Moka app. From there, navigate to the “Settings” tab. Next, select “Manage Subscription” and choose “Cancel Subscription”. Follow the prompts to complete the cancellation process.
How can I reach Moka customer service?
If you need assistance or have questions about your Moka account, you can email [email protected], and a customer service representative will get back to you. You can also start a conversation with the Moka customer support team via in-app chat by opening the Moka app and tapping the “Help” icon located in the menu at the bottom.