When it comes to personal finance management, tech plays an important, yet often overlooked role. Whether you want further insights regarding how you spend your money, are looking for a better way to manage and grow your savings, or just want convenience and efficiency in accessing, spending and transferring your money, there are a lot of ways in which online services, websites and apps can help.
With this in mind, here is a guide to the tech you need, and the organised approach you should take to financial management.
Putting Your Savings to Work
While convenience and insight are useful in providing you with opportunities to save and improve your cash flow, the way you use your savings is crucial in maximising your earning potential and improving your long term savings prospects.
A surprising number of people keep their savings in a bank account with low interest rates, or (even worse), keep it in a spending account with no interest at all. Whilst it will involve risk, a diversified investment portfolio is an approach that many financially savvy individuals will take in utilising (at least some of) their savings. However, it is important to understand the risks involved when investing, and how you can minimise them.
An important way to reduce risk is through diversification – investing in a range of assets that are each affected differently by external factors. In diversifying, and including investments of various sizes across risk levels, the right approach will mean that your savings are working for you, rather than sitting in your bank account.
An example of how tech can help you with this is in terms of crypto – digital exchanges such as Independent Reserve provide a great opportunity for crypto traders to buy and sell cryptocurrency – whilst crypto risk is high, Bitcoin hit an all time high in late 2020, institutional investment is on the rise, and the industry is seeing significant developments as a whole. There are also plenty of ways to invest in shares and other assets using technology.
Track Your Spending and Manage Your Budget
Once you have decided how you want to manage your savings, shift your focus towards how you spend your money. Spend tracking and budget management are crucial in maximising the amount you can save, and will optimise your spending as well.
Technology couldn’t be more useful in today’s digital world – while there are a range of approaches you could take, you can find simple but effective tech offerings in terms of mobile apps. The right services can provide you with month to month spending habits, will allow you to view regular payments and create automated transfers to savings accounts, and can give you the ability to move your money instantly.
While this is an example of newer tech, this shouldn’t mean that you overlook the usefulness of a simple excel spreadsheet. In creating a comprehensive and realistic budget and storing it in digital form, you’ll be able to refer back to it and use it in the context of long term savings goals.
Educate Yourself on Spending, Saving and Investing
Finally, never overlook the importance of being financially educated. The way we manage our finances is constantly changing, and knowing the best financial practices and approaches is crucial in safe and effective financial planning.
Financial education doesn’t mean you’ll have to undertake a commerce degree, or even pay for a course online – learning more about money management can be as simple and easy as making use of the abundant free resources – in the form of both articles and videos.
Taking advantage of this free knowledge will put you ahead of the rest when it comes to using your money, hitting your long term savings goals, and giving yourself the freedom to live the life you want to live.