Digital technology has transformed personal financing. People can use their mobile devices to manage their personal finances from anywhere, at any time. New digital technologies are in development that will further change personal financing.
With a clear understanding of these technologies, you’ll be well-equipped to get the most out of them. You’ll be able to use digital technology to manage your personal finances like a pro.
Don’t expect the digital era to slow down any time soon. Now, let’s look at five areas of personal financing that will continue to evolve with digital technology.
1. New Media
The rise of new media has impacted how people invest. Facebook, Twitter, and other social networks let people quickly and easily access investment news and insights. It has affected investment market trends in several ways.
Headline risk has become increasingly common due in part to new media. This phenomenon occurs when a news story about a business or industry goes viral and impacts investment decisions. It can drive people to rapidly buy or sell stocks or cryptocurrencies.
Along with headline risk, new media creates emotional data that affects investment decisions. For example, people were increasingly fearful about investing at the beginning of the coronavirus (COVID-19) pandemic. Meanwhile, this may have contributed to the stock market crash of March 2020.
New media can impact personal financing, and you need to plan accordingly. To do so, conduct plenty of research before investing and review research from multiple sources.
Establish realistic expectations for investments. This helps you make informed and rational decisions so you can accomplish your financial goals.
2. Digital Banking
It’s easy to track your personal finances from your smartphone or tablet. Download your bank or credit union’s mobile app. From here, you can get real-time updates on your personal finances. You can even use the app to pay bills and complete other financial transactions.
Expect the push for digital banking tools to continue. About 60% of mobile phone users have set up notifications about their bank accounts. This figure may keep increasing. If it does, more people will be able to manage their personal finances with precision and care.
3. Personal Credit
In addition to digital banking apps, personal credit apps are available. Personal credit apps let mobile device users access their personal credit information on the go.
If credit issues crop up, users can get instant alerts about them on their mobile devices. They can then take the steps required to address such issues before they damage their credit score.
Personal credit apps are becoming must-haves for people young and old. The apps help mobile device users keep a close eye on their personal finances. They empower users with insights they can use to avoid credit problems.
Stocks can be risky but are often viewed as the best way to invest. This is because stocks can deliver outstanding long-term returns. However, crypto looks poised to replace stocks as one of the top investment options.
Crypto investments are easy to find. You can buy popular cryptocurrencies like Bitcoin and Ethereum using a mobile app. Once you do, you can monitor their performance in real time.
The global crypto market is projected to grow. As it does, more crypto investment opportunities will become available. How investors evaluate these opportunities will dictate their returns.
When it comes to crypto, resist the urge to put all of your eggs in one basket. Rather, start small and build a crypto portfolio. You can buy crypto in conjunction with purchasing stocks and making other investments.
Also, you can use digital technologies to assess your investments over time. This enables you to monitor their progress and position yourself to achieve the best possible results.
You are eligible for Medicare once you reach the age of 65 or are dealing with a qualified disability. Medicare is not an all-in-one healthcare solution. Conversely, multiple Medicare plans are accessible. Each one has its pros and cons and should be evaluated carefully.
Digital tools help people assess Medicare plans. They provide people with access to insights they can use to evaluate all aspects of these plans. Plus, people can gain expert insights into how different Medicare plans work and which ones offer the best ROI.
For those who do not qualify for Medicare, it helps to use digital tools to budget. That way, if a medical emergency arises, you’ll be able to manage any financial hardships associated with it.
Putting money into an emergency fund is an excellent way to save for medical emergencies. Even setting aside a small amount each month can make a world of difference.
This money can ultimately help you manage your finances in a medical emergency. You can even use mobile apps to track your emergency fund now and in the future.
The Bottom Line on How Digital Technology is Transforming Personal Financing
Digital technology simplifies personal financing. The technology empowers people to seamlessly manage their personal finances from around the world. It also gives people convenient access to investment resources, tools, and insights any time they need them.
The future looks bright for digital technology for personal financing. As new digital technologies are developed and launched, people will be able to track, evaluate, and control their personal finances like never before.
Dan Matthews is a freelance writer with a penchant for financial wisdom and solid research. You can find him on Twitter @danielmatthews0 and LinkedIn.