Financial Education Resources

There are two groups of people in the technological world today: those who once lived in a world without smartphones, and those who have only ever known life with a mobile device in hand. Gen Z - almost entirely digital native users - have always known the convenience of mobile technology. In fact, among young adults, more than 70% would rather be without their wallet than their phone.

Digital wallets — managing financial transactions through mobile apps — connect traditional banks and their debit cards with ever-advancing mobile technology. A digital wallet eliminates the need for a leather, trifold (or dare we say, Velcro) wallet in your pocket at all.

Services such as Google Pay™, Samsung Pay™, Apple Wallet^®, and even the original grand-daddy digital payment site — PayPal™ — give you access to your money digitally. You can even use your Fitbit Pay™ features and be hands-free, and money-enabled.

Just like you don't need a wallet to carry around family photos, digital wallets eliminate the need for you to carry around your credit card. You can even use your digital wallet to store your digital tickets to the IRL baseball game or concert you are attending this weekend, your car keys, and your gift cards.

Digital wallets have long since blown past the ancient American Express^® tagline, "Don't leave home without it." The ease of these money-moving apps is designed to be user-friendly no matter what generation your age says. If you're curious to dip your toes into this new world of paying for things differently or more accurately conveniently, here are the big-name payment services to download and go.

The best of digital wallets

Before you determine the best app for you, you might want to understand a bit about digital wallets in general. Digital wallets may use Bluetooth^® or NFC (near field communications) chips that simplify the payment process. They may connect to other apps on your phone or use your phone's camera to share information via QR codes.

Consider that these apps store your payment information, your checking account information, and a considerable amount of your personal information, so you need to understand how they work and how to protect your data.

Digital wallet providers

When you buy a new mobile device, it likely includes the digital wallet designed for your operating system. If you purchase an iPhone, it may feature Apple Pay^®. If you buy an Android™ device, it may include Samsung Pay or Google Pay.

PayPal, which started as a payment option at the advent of the internet when the idea of using a debit card or a credit card on an unknown website was just crazy talk, effectively transitioned into the digital wallet space. Its own app works across all phones and platforms and can be downloaded for free in the Google Play™ app store and the Apple^® App Store.

The question isn't about which app is best — everyone might have their own opinion — but which digital wallet app is best for you. Let's look at the big three.

1. Apple Pay, Apple Wallet, and Apple Cash

First introduced with the iPhone^® 6 in 2014, Apple Pay began delivering a variety of Apple-named apps and services, all designed to help you facilitate money movement on your iPhone, Apple Watch, or a combination of other devices and technologies based on its iOS operating system.

Apple Pay

Apple Pay^® includes all the features and services related to your digital wallet on your Apple device. This consists of the logon and security features, how the device interacts with the payment process at retailers and online, and the contactless payment features. Overall, Apple Pay is more about the systems, not the services.

Apple prides itself on its ease of use and the security benefits the service offers. No one sees your card number during a transaction. The same technology you use to keep your device secure — Touch ID™ or Face ID™ — also keeps your personal information safe within all the Apple Pay services. Users concerned with privacy and theft will likely consider this aspect of the various digital wallets the best of the bunch.

Apple Pay also connects other Apple features and apps, including Apple Music^®, Apple's iCloud^® storage, and the Apple Wallet and Apple Cash™ features.

Apple Wallet

This is the core (pun intended) of Apple's digital wallet. This is where credit card and debit card numbers are stored, where you might keep your driver's license information, and where you set up payments. When comparing digital wallets, Apple Wallet is the specific app on Apple devices.

The features and services within Apple Wallet will continue to change and improve with operating system updates. This is also where you will need to update your information when your debit card expires or when you add a new account.

The terms Apply Pay and Apple Wallet are often used interchangeably, so consider Apple Wallet the digital wallet aspect of your iPhone's financial offerings.

Apple Cash

Imagine pre-internet, when you cashed your paycheck, you may have kept an envelope of cash separate for purchases at stores where writing a check wasn't convenient. Apple Cash is the digital version of an envelope of cash. You can transfer money into Apple Cash, use it until it runs out, and then replenish it.

It's just a more minor part of the Apple Wallet, but it is also just one more place where you might have money stashed. Imagine every place where you have money — your checking account, your savings account, your 401k, your HSA Apple Cash — all add up to a lot of virtual locations where your money spreads out. Keeping tabs on your money can become challenging the more places you have bits of it stored electronically.

2. Google Pay, Google Wallet, and Samsung Pay

Much like its competitor, the terms Google Pay and Google Wallet™ are used to describe Google™'s money-movement services, but Google Pay™ is the official brand name. Speaking of brands, Google dubbed its first financial offering in 2011 as simply "Wallet," so it was on the right track, understanding that mobile technology would eventually replace your physical wallet.

Android Pay™ followed but became more of a peer-to-peer payment process. As technology changed, Google combined Wallet and Android Pay into Google Pay.

Google Pay

Google Pay includes the features often referred to as Google Wallet. Google Pay is the name of the app and all the related services. Conveniently, an iPhone user can download Google Pay to their iPhone, but Apple Wallet is not available for Android™-based phones.

Since it was created first, Google Pay was often accepted in more places, but the technology has caught up more universally. Google Pay offers a variety of features, many similar to Apple. In addition to technology changes, Google continues to expand into the financial services area for consumers and merchants, tapping into Google Cloud™ offerings and expanding into corporate partnerships.

Google Wallet

If you search the Google Play app store, you won't find Google Wallet. You might use the term to describe the area within Google Pay where you record your debit card and credit card numbers, make payments, and update your account information. You can also record vaccination information, a feature added to Google Pay as the pandemic focused more on both contactless payments and keeping important personal data handy.

All that personal data and information is secured using the privacy and protection features of the phone. You can also use your Samsung^® device to take a picture of your debit or credit cards to add them to the wallet section of the app. Alerts to your phone advise you when a payment is made from Google Pay, so you will be aware of digital wallet payments, but not spending or transaction history.

Samsung Pay

The Android operating system doesn't only power Samsung devices, but Samsung Pay, like Apple Wallet, is specifically designed to align with the device. Samsung Pay has not expanded to as many countries as Google Pay, but both Google Pay and Samsung Pay allow payments through PayPal. Still, only the Samsung^® app allows international payments through the next digital wallet.

3. PayPal

PayPal not only launched digital payments all the way back in the last millennium, but it also offers far more money-movement services than just as a digital wallet. As just mentioned, PayPal helps move money within other digital wallets, but it also ranks in the category of P2P payment apps such as Venmo^® and Zelle^®.

PayPal's whole business is based on allowing people to make and receive payments. Unless you are new to the internet, you likely already have a PayPal account, and your credit or debit card is already linked, so downloading and setting up the app just got easier. It can also be accessed from a desktop as easily as a mobile device.

PayPal One Touch

Like Google Pay, PayPal's digital wallet app, known as One Touch^®, has the benefit of being available to users of several different devices — iPhones, Samsung, Sony^®, HTC™, etc.

Since PayPal is primarily an internet-based payment system, point-of-sale purchases at physical stores are managed more conveniently through Google Pay or Apple Wallet. Even online, you need to check in at whatever store you're at before making the purchase, and it may not feel easier than just pulling out your debit card or using another digital wallet.

Additional digital wallets

Not all digital wallets are simply another mobile app. For example, Amazon has digital wallet features within its app — it allows you to save credit cards, debit cards, and gift cards — but it is considered a closed digital wallet, meaning you can only access your Amazon™ digital wallet within its online store.

Semi-closed digital wallets allow flexibility across more stores, but the stores must have standing agreements with the payment apps, so they are more specialized and limited

Choosing the best digital wallet

If you're already using the default digital wallet on your mobile device, you've probably already become comfortable with the features and benefits. If that ship has sailed, be an ally for the app. Write a review or introduce others in your circle of friends to its features and benefits.

If you are just braving the waters, you might need to have a few questions answered before you give up your physical wallet for good. Here are some considerations to ponder, or at least to ask others about their favorite digital wallet.

Mobile security for digital wallets 

Like any time you hand over your account information, you want to be 100% certain your information is secure. You wouldn't withdraw cash at an ATM without entering your PIN, don't neglect the similar features protecting your digital wallet. Whether you prefer Face ID®, Touch ID™, or always locking your screen (and not with a bad password like "111111"), always use your phone's security features to protect your financial information.

iOS™ and Android are constantly offering software and phone upgrades to improve features and enhance security. Keep your operating system current and install upgrades to ensure you have any patches. Likewise, update your apps regularly. Most devices allow you to have apps automatically updated. Save yourself the hassle and ensure updates to all apps, especially your digital wallet, are activated.

Track your digital spending 

Since most of these apps don't track your purchase history, you may not see how much you are spending daily or even paycheck-to-paycheck. It's easier to lose track of your budget when you don't see the cumulative purchases in your digital wallet.

Since your debit or credit cards are connected to your digital wallet, you still need to keep tabs on your traditional accounts from where the digital wallet draws your money. It can make tracking your spending harder when you have multiple cards pulling from several sources.

A good best practice would be to consolidate your funding sources — just one debit card and one credit card connected to your community bank or credit union so you can still utilize spending alerts and quick login to view each mobile payment from your digital wallet over a week or month.

As you enjoy the benefits of your digital wallet, you may find that your physical card rarely gets a swipe. Consider taking advantage of alerts and notifications from your mobile banking app or online banking to keep tabs on your spending.

Don't forget your digital savings 

Digital wallets make purchases and spending easier, but they don't prioritize your savings goal. Setting up automated payments to your savings account will allow you still to prioritize your long-term goals in an equally straightforward process — even easier than your digital wallet

Customer service and support 

If you have a hiccup with your digital wallet, you'll likely be directed to an online form or a chatbot. Ultimately, your digital wallet's funding sources — your debit card or credit card — go back to your financial institution, so be sure you have a local bank that allows you to get help when needed.

Digital wallets offer a good deal of security, but as technology advances, so do the threats of cyber thieves. Have a plan and resources to deactivate your cards from your digital wallet in an emergency. Likewise, if you lose your phone, have a way to make changes to your digital wallet from a computer.

Open your new wallet

Finding ways to spend money will never be difficult, and digital wallets can make spending easier still. However, responsible money management remains the same, regardless of your wallet.

If you're still carrying a physical wallet, give a new mobile wallet a try. If you are already using your digital wallet as your only payment method, consider yourself a digital native.