facebook twitter instagram linkedin google youtube vimeo tumblr yelp rss email podcast phone blog external search brokercheck brokercheck Play Pause
Military Finances 101: Virtual Spending. Which Payment App Is Right For You? Thumbnail

Military Finances 101: Virtual Spending. Which Payment App Is Right For You?

Managing Your Finances

While paying online has become easier and more accessible over the years, the COVID-19 pandemic took virtual spending to an entirely new level. As more and more people are embracing this type of spending, the payment options are growing.

With that in mind, which virtual payment option may be right for you? Here are seven of the top apps (arranged in no particular order) available to most consumers right now. 

Option #1: PayPal

PayPal has been around since 1998 and acquired by eBay in 2002, making it the provider for eBay transactions.1 Users are typically not charged a fee when sending money to friends or family members, but you will be charged a fee if you send money from a credit card or convert any currency. Users have the ability to transfer money to any U.S.-based bank account plus several foreign ones. 

Paypal Fees and Transaction Limits

There is no fee to open an account, but there may be a 2.9 percent processing fee per qualifying transaction. Users can send up to $60,000 through PayPal, however, they may be limited to sending $10,000 per single transaction.2

Option #2: Venmo

Venmo is owned by PayPal, however, there are some key differences between the two apps. 

It is designed specifically for sending money between friends and family. Unlike Paypal, there is a social aspect to Venmo, as users are encouraged to include messages and emojis in transactions that can be seen by other users in your network.

Venmo uses encryption protocols in order to protect the personal and financial information of the users with information stored on servers that are in secure locations. Additionally, you can set up a PIN code and multi-factor authentication for greater security. 

While Venmo is primarily used on your mobile phone, the above security measures are put in place to allow users to receive and transfer money effortlessly and safely.  

Venmo Fees and Transaction Limits

There is no cost to send money using your bank account, and users can pay for business transactions using this app. There is a three percent processing fee for qualifying transactions with a $299.99 spending limit for unverified users and less than $4,999.99 a week for verified users.2 

Option #3: Zelle

Zelle is a mobile app with a simple interface. As a user, you can send same-day money transfers to anyone who has an account with a participating bank including:

  • USAA
  • Navy FCU
  • Chase
  • Bank of America
  • Citi
  • Wells Fargo
  • Ally
  • Capital One

Zelle has an app available for download on your phone, however, you can send money without the app, as well. Use your primary account when using Zelle, as you can only connect one account at a time using this app. 

Zelle Fees and Transaction Limits

Zelle is free for the user, however, banks are charged between $0.50 and $0.75 for each transaction. As far as transactions go, if your bank doesn’t offer Zelle, then you can only spend $500 per week.3 If it does, you can spend up to $1,000 in 24-hours, $2,500 in a week or $10,000 in a month.4 

Option #4: Apple Cash

If you have an iPhone, you can easily send or receive funds through Apple Cash. To use this app you can: 

  1. Open the messaging app
  2. Select or create a new contact
  3. Tap the Apple pay icon at the bottom of your screen

Apple Cash Fees and Transaction Limits

There is a one percent fee deducted from each transfer, and you can send or receive a minimum of one dollar with a maximum of $10,000 in a seven-day period.5 

Option #5: Cash App

Cash App, formerly known as Square, is now the number one finance app in the App store.6 Upon signing up, you are given a screen name called a $Cashtag. You can easily find others using their phone number or email address. Using a linked bank account, Cash App allows you to send and request money virtually. 

Cash App Fees and Transaction Limits

Cash App is free to set up, but if you pay with a credit card, each transaction will incur a three percent transaction fee.6 It generally takes one to three business days to transfer funds to your bank account. If you prefer to receive your money instantly, expect a 1.5 percent transaction fee. You can send up to $250 within a 7-day period and $1,000 within a 30-day period.7 

Option #6: Google Pay

Formerly known as Google Wallet, Google Pay integrates with the G Suite account you may already have. It’s designed to work well with other Google products and services, making it easy and intuitive to use for those who are already accustomed to Google’s offerings.

Google Pay Fees and Transaction Limits

There are currently no fees to sign up to use Google Pay. Users are limited to sending up to $10,000 in a single transaction.8 

Option #7: Facebook Pay

Facebook is home to around 2.7 billion users.9 Through Facebook Messenger, users can send money to anyone with an account - as long as their debit card has been connected. Once payment has been accepted, it will appear in your bank account within five business days.  

Facebook Messenger Fees and Transaction Limits

Facebook Pay has no fees and does not store money in an online account. There is no minimum amount that you can send or receive and the maximum amount is $9,999.

From online shopping to splitting the bill at dinner, payment apps provide convenience and security when it comes to spending your money. With plenty of options to choose from, these tools can help streamline your payment methods for future transactions.

If you found this article useful, you might like these blog posts:

Military Finances 101: Tax Free Leave

Military Finances 101: The World Just Went Virtual. But Should Your Financial Planner Still Live in Your Area?

Military Finances 101: What Is a Mortgage and How Does It Work?

  1.  https://www.electronicpaymentsinternational.com/news/paypal-history-milestones/
  2.  https://www.architecturaldigest.com/story/the-best-online-payment-options-for-designers
  3. https://softwarecorporation.com/2020/06/29/heres-what-you-need-to-know-about-zelle/
  4. https://www.usaa.com/inet/wc/mobile_banking_send_money_zelle_faqs_index#:~:text=Your%20payments%20can't%20total,or%20%2410%2C000%20in%20a%20month.&text=After%20they%20enroll%2C%20it%20can,payment%20in%20their%20bank%20account.
  5. https://support.apple.com/en-us/HT207884#:~:text=Sending%20or%20receiving%20limits,receive%20a%20maximum%20of%20%2410%2C000.
  6. https://www.cnet.com/personal-finance/8-best-payment-apps-in-2020/
  7.  https://www.businessinsider.com/how-much-can-you-send-on-cash-app
  8. https://www.digitaltrends.com/mobile/paypal-vs-google-wallet-vs-venmo-vs-square-cash/
  9. https://www.statista.com/statistics/264810/number-of-monthly-active-facebook-users-worldwide/#:~:text=How%20many%20users%20does%20Facebook,network%20ever%20to%20do%20so

This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by C.L. Sheldon & Company, LLC ), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. C.L. Sheldon & Company, LLC does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to C.L. Sheldon & Company, LLC website or incorporated herein, and C.L. Sheldon & Company, LLC takes no responsibility therefore. All such information is provided solely for convenience, educational, and informational purposes only and all users thereof should be guided accordingly. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from C.L. Sheldon & Company, LLC . To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. C.L. Sheldon & Company, LLC is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the C.L. Sheldon & Company, LLC ’s current written disclosure statement discussing our advisory services and fees is available for review upon request. DISCLAIMER OF TAX ADVICE: Any discussion contained herein cannot be considered to be tax advice. Actual tax advice would require a detailed and careful analysis of the facts and applicable law, which we expect would be time consuming and costly. We have not made and have not been asked to make that type of analysis in connection with any advice given in this blog post. As a result, we are required to advise you that any Federal tax advice rendered in this blog is not intended or written to be used and cannot be used for the purpose of avoiding penalties that may be imposed by the IRS. In the event you would like us to perform the type of analysis that is necessary for us to provide an opinion, that does not require the above disclaimer, as always, please feel free to contact us.