These days, technology can help us do almost everything, from working more efficiently to enjoying ourselves with better entertainment. But have you considered utilizing modern technology to get your personal finances in better shape?
Elements of Personal Finance
Let’s start by defining what we mean by “personal finance.” Better personal finance habits typically focus on one or more of the following categories:
- Improving knowledge. First, you should be constantly improving your knowledge. You need to better understand how finance works, including how compound interest is calculated and how to calculate the risk of an investment, and you should work to better understand your own saving and spending.
- Increasing income. Much of your long-term financial success depends on your ability to increase your earnings over time.
- Minimizing expenses. You also need to think about minimizing your expenses, resulting in additional savings.
- Living below your means. Living below your means is a strategy that requires you to restrict your lifestyle spending so you can end up with a monthly surplus. From there, you can establish an emergency fund, save for retirement, and accumulate wealth.
So how can technology help you in these areas?
Open Accounts Online
There are hundreds of reliable websites where you can open new accounts and manage your finances online. For example, you can sign up for an online debit card tied to your checking account; you can use the debit card for all manner of purchases, and check the balance of your checking account at any time. You can also send and receive payments across different accounts easily, and always keep a finger on the pulse of your finances this way.
Establish (and Keep) a Budget
With the help of a website or mobile app, you can create a budget that works for you—and ultimately stick to it. You can make use of a template recommended by the app developers, or rely on a template suggested by your peers; you can also build a budget from scratch.
Whatever you choose to do, you’ll be able to quickly and easily keep track of all your income and expenses. You can even track your habits over time, so you can see where you’re spending the most money. Some services even give you direct recommendations for how to improve your habits.
Automate Your Payments
One of the most reliable ways to increase your credit score is to make payments for things like credit card bills, utility bills, and loan payments on time and in full. If you’re forgetful, or if you’re bad at managing finances, this can be challenging. But thanks to modern technology, most companies and organizations now offer you the ability to sign up for automated payments.
Here, all you have to do is enter a bank account or a debit card/credit card, and the correct amount will be deducted from your balance every month. All you have to do is make sure there’s enough money in the account; over time, your credit score should reliably increase.
The internet opens the door to many modes of research, which should allow you to figure out alternatives to your current financial strategies. You can learn from expert recommendations on authoritative websites. You can shop around with different financial providers. You can even read up on consumer reviews to learn which financial strategies and products might serve you best.
For example, you might be able to find a credit card that offers a much lower interest rate, and transfer your balance so you can save more money each month. You might also discover new ways to lower your utility bills, or learn about potentially lucrative investments.
Start a Retirement Fund (and Invest)
Most major financial institutions make it easy to open a retirement plan online, allowing you to save money for your future and invest in various assets. Retirement plans are useful because they typically offer some kind of tax advantage; in other words, they allow you to make more money on your investments and generate wealth long-term.
Perhaps the greatest advantage of modern technology is its ability to support ongoing learning. There’s a ridiculous amount of content on the internet, including expertly written articles, in-depth videos, and forums that are rife with discussion on all manner of personal finance topics. If you keep reading, watching, and following along, you can greatly improve your personal finance knowledge.
Technology has a lot to offer in terms of personal finance improvement, from better platforms for learning and education to apps that can help you save money on a regular basis. Take the time to improve your financial literacy, and it’s only a matter of time before you’ll find yourself in better financial shape.