We have evolved digitally to manage our lives better and with ease. Whether it is our physical health or our financial health, it requires special attention, planning and management. Digital tools and applications have made it easier for us to have a better say over how we manage our finances whether personal or professional. Every individual understands the importance of personal finance management to capitalize on assets and achieve all future goals.
With the deadly virus, the COVID-19 pandemic hitting hard, it has compelled people to manage their finances better. The COVID-19 lockdown and social distancing practices have crippled most industries, leaving many people unemployed. This has led to people realizing the virtues of prudent financial management. Financial services that understand this imminent shift have offered their audiences the right ways of managing finances to emerge stronger from this crisis by establishing a strong connection with their customers. To capitalize on this trend, banks and financial institutions are providing customers with new tools.
Why one should go for financial management?
Whether individual or professional level, financial planning means well-thought-out budgeting as a way to regulate your money towards meeting your life objectives. A Financial Wellness Survey by PwC found two major financial concerns, one is 52% of the Baby Boomers are not able to take voluntary retirement and Gen X (55%) and Millennials (62%) are not having enough emergency savings for unexpected expenses.
Most Americans have some credit card debt. A recent GOBankingRates survey found that 30% of Americans have between $1,001 and $5,000 in credit card debt, 15% have $5,001 or more in credit card debt and about 6% have more than $10,000 in credit card debt. Although 6% may seem like a small amount, that means that based on the survey results, 14 million Americans have over $10,000 of credit card debt. According to the NFEC study, the average American lost $1,634 in 2020 due to a lack of personal finance knowledge. That’s enormous!
To make sound financial decisions, it’s essential to have a good understanding of personal finance trends and be better equipped to make informed choices about money to improve your financial future.
Need for Digital Financial Management
Today’s digital-savvy generation doesn’t believe in taking the help of experts or managers to keep their financial health on track because of the ease of the digital ecosystem. This has simplified this journey, making financial planning possible at the click of a button.
The ecosystem thrives on payment enablers, mobile banking, and account aggregators which has created a seamless digital journey for individuals. Several applications and software tools are available to assist in tracking your earnings, controlling your expenses, and maintaining assets. As is implicit, a finance management application is a tool that enables you to manage finances better. It integrates the financial information of a client and segregates this data to deliver an insightful result for better financial planning. This app can take different financial data as input information and can help with bank records management, budget management, investment tracking, portfolio management, etc.
According to Allied market research, the worldwide personal finance software market size was valued at $1,024.35 million in 2019. By 2027, it is projected to reach $1,576.86 million, growing at a CAGR of 5.7% from 2020 to 2027.
Americans are slightly more likely than people in other countries to manage their finances with the help of a computer or online financial software rather than an accountant or certified financial adviser. According to Gallup, 32% of Americans use online programs regarding money management, while 24% use an accountant or certified financial planner.
How can the Financial App help you?
The finance app, is a one-stop platform that showcases your complete financial picture. Once you link your credit and debit cards to your account, the app populates all your transactions, categorizes them, and shows how you spend your money. You can keep track of your bills and spending and create a budget you can stick to. You even have an access to your credit score along with a breakdown of the factors contributing to your score to stay on top of your credit health. Plus, you can track your investments and manage utility payments. A finance management application helps in:
• Keep track of your income and expenses
• Plan a budget and monitor your savings
• Facilitate making payments for several services
• Guide you for intelligent savings and investments to make money
• Increase cash flow through tax planning, prudent spending, and careful budgeting
• Ensure family financial security
• Keep track of credit score