Want to get started in investing, but don’t have the capitol or know how? Moka (formally Mylo) is an app that can help!
Disclosure: Please note that some of the links in this post are affiliate links. Please read my affiliate disclosure here.
One of the oldest adages when it comes to saving money and acquiring wealth, is to pay yourself first. This simply means that whenever money comes in, you allocated a portion of it to a savings account. Every time you do this, your net worth increases and your future self will thank you.
Of course the simplicity of this concept is overshadowed by the complexity of life. There are so many things than can come in the way of paying yourself first Living paycheck to paycheck, an unexpected big expense, or even simply forgetting, can all be obstacles to saving for the future.
For those of us who have may not have the greatest memory, or who like to automate their life, Moka is a perfect solution for building up savings.
What Is Moka?
Moka is an easy to use app that rounds up the purchases you make and deposits the money into an investment account. For example, if you buy a cup of coffee for $1.49, Moka will round up the total to $2 and put the extra $0.51 into an investment account. Each Monday, Moka will tally up all of the round ups from the previous week and withdraw the amount from your connected bank account and deposit the total into your investment account.
That’s it. It’s super easy and hands off for you! Moka takes care of everything!
Setting Up an Investing Account with Moka
When you are setting up your account, you can choose between a TFSA, RRSP (only available with Moka Advantage) or a non-registered account. The choice of account will depend on your investment goals and current investment plan. Since I already have a TFSA and RRSP through other means, I use my Moka investments for short term saving goals and have it set as a non-registered account.
Remember that with a TFSA, you are taxed on the money going in, but not when you take it and the earnings out. You also have limited contribution room each year.
With a RRSP, you are not taxed on the money going in, but are taxed on the income when it comes out.
This is a super basic explanation of the difference between TFSAs and RRSPs, but the key differential.
One of the greatest things about Moka, is that you do not need any investment knowledge to have an account. The money put aside is not self- directed. Moka is advised by a registered Canadian portfolio manager at Tactex Asset Management, a subsidiary of Moka Financial Technologies Inc. that currently manages over $130 million in client assets. This means, that your account is managed by team of portfolio managers.
Part of the account set-up process is a quick questionnaire that gets to know you as an investor. It helps your portfolio manager understand your financial situation, your risk profile and your financial goals. This tool helps the Moka team make sure they invest your money in a way that you will be comfortable with.
Setting a Savings Goal
Whether you are saving for a rainy day, post-secondary plans or a fabulous trip, having a savings goal is paramount to success. Knowing that money is going to something you really want helps you stick to your plan and celebrate your success.
When you set up your account, Moka will ask you to set your savings goals. You can choose how many goals you want to have and determine the percentage of each round up that is allocated to each goal. You also determine the goal amount. Want a new pair of $300 shoes? Set a custom goal for $300 shoes. Planning a $1500 trip to the Dominican? Set a ‘Go on an Adventure’ goal for $1500. Then watch as your goal meter grows each week!
One of the best features of the goal setting is that you can see how much money has been accumulated towards each goal. This great visual keeps you motivated and excited for Moka gives you the option of creating a custom goal, or choosing from one of the popular goals of: charitable giving, saving for retirement, an emergency fund or to go on an adventure.
How Investing with Moka Works
After reviewing your ‘Know the Client’ questionnaire that establishes your investment personality, your portfolio manager will recommend an investment strategy that will best work for you. Your result will be one of five diversified portfolios comprised of a mix of stocks, bonds and savings funds, suited to your personal goals ranked from Conservative to Aggressive (you can view the full list, along with the stocks that make up the ETF here).
The money that your account generates will depend on the type of portfolio that you register for. Like with any investing endeavour, your principal and gains are not guaranteed, which means that you can lose money when stock prices go down.
Moka lets you monitor your portfolio’s performance with monthly statements that are sent out each month. These statements show how your portfolio has performed overtime and will tell you the book value (the amount you invested) and the market value (what your account is currently worth). You can figure out how much you’ve earned on the account by subtracting the book value from the market value. Of course, the stock market is always changing and thus so is your account’s value.
How Much Does Moka Cost?
Moka is $3 per month and includes the investment portfolio, next day withdrawals and lots of great Moka perks!
In addition to the monthly Moka account fees, there are also third party management fees that range from between 0.06% and 0.38% of the amounts invested for regular portfolios and between 0.20% and 0.69% for socially responsible investing portfolios. The amount of the third party fees will be determined by your investment portfolio. Read more about their fees here.
Once you have achieved your savings goal, or even when you’re just ready to access your money, withdrawing from Moka is easy.
You can withdraw at any time, regardless of your account balance amount and there are never any fees to withdraw.
Simply login to your account, go to your goal, click on the “…” button on the top right corner and then “withdraw”. Moka offers next day withdraws, so your funds will be deposited into the bank account that funds your Myko super fast.
That being said, it is important to remember that the value deposited into your chosen funding source will be determined by it’s market value at the time of withdrawal. Thus it may be more or less than you anticipate depending on the stocks’ value.
Moka Referral Codes
Not only does Moka invest your money to earn you more, but they also offer a very generous referral bonus.
When someone uses your referral link to join Moka, both you and that person get $5 added to your accounts!
This is a great way to boost your savings and help you achieve your goals faster!
What I Like About Mylo
Moka is a great app for helping you save.
I love that it is so hands off and automatic. Once you set up your initial account and complete the paperwork, there is nothing left to do. Each Monday, Moka rounds up all of the purchases you’ve made on whichever accounts you decide to include and then deposits them into your investment account.
Myko also has great cashback perks for members on brands that people actually use.
Then you watch your savings grow until you are ready to withdraw them.
Simply clicking on the withdraw link, and following the easy instructions will initiate the transfer of your portfolio’s funds into the funding source you’ve chosen.
You can earn more money by referring others to this great program. Not only do you get a bonus, but so do they! And, you both start an easy, automatic investing journey!
Moka also simplifies budgeting. Simply round up all of your purchases and make addition so much easier with whole numbers! (Sure this is a little superficial, but it sure is handy!)
You can boost your savings with recurring deposits into your account or one time deposits, in addition to your round ups! Accelerate your time line by saving more!