Technology is always a carrier of progress, and it changes the way we live our life. No wonder it has also altered the way we manage our money. Whatever financial activity we perform, whatever decision we take in personal finances, technology drives it.
Here is an insight into how the tech-driven world and in turn our money management ways–
Digital wallet – Money is handier
Gone are the days of heavy wallets and also the cash transactions. Now you can pay in a much better way through digital wallets that keep the money stored in your smartphone. Just a few clicks on your mobile screen and the money gets transferred.
Transformation in cash transactions from actual cash transactions to digital wallets -
|Digital Wallets||Traditional Wallets|
|You keep money online||You keep money in cash|
|Faster money transactions||It depends on cash availability|
|Environment-friendly, you don’t cut trees for it||Just opposite to the digital wallets on this aspect|
|Can be secured from a strong password||Cannot be secured so easily, the threat of snatching|
|Easy to carry a big amount without space issue||Never possible to carry too much money|
|Connected to your bank account||Traditional wallets need to refill with hard cash|
In short, we have many reasons to be addicted to digital wallets. In future, we are going to depend more on it. However, many financial advisors suggest doing cash transactions to avoid the habits of overspending money. Perhaps both are important, but if you are self-disciplined, the digital wallets are more suitable.
Social media following of brands make us spend more
Technology has improved our communication and has made us more vocal about our concerns. We all know that social media is like a lifeline for the modern world. The reason is, more than physical, people meet virtually. The businesses and brands enjoy the same facility by using the varied platforms for their promotion.
Most of us follow brands on Facebook, Instagram, Twitter etc. and these platforms become the magnet to such our money for buying new things. There is a reason why brands use influencers to promote people.
- Every update by the brand reaches to us through notifications and provokes us to purchase.
- The ‘call-to-action’ button makes the purchase easier and one can buy exactly the same thing.
- People easily react to brands that reflect their ideology. Brands know how to do that.
Transformed borrowing practice
In older days, borrowing was about making several visits to the banks for formalities and interest rate negotiation. That too used to follow by a long wait on approval decision. Things have drastically changed now because everything happens faster now.
- The direct lending has emerged as an alternative to mainstream lending or banks. Direct lending is also known as next-generation online lending.
- Funds are now available even to those with poor in fact very poor payment history. The aim is the financial well-being of more people that can finally turn into strong customers for the finance companies.
- Loans, irrespective of credit score are available with additional features such as very bad credit loans with no guarantor and no broker required.
- The application process is paperless, which saves time and also money that you used to spend on documentation and hefty filing.
There is a parallel industry to conventional lending in the form of online loan companies. Especially for short-term purposes, people are more inclined to flexible loan choices. If you want to get fast loans with no guarantor or quick loans, or bad credit loans, the online borrowing options are available.
Ease of money SOMETIMES causes irrational spending behaviour
Technology is a blessing, but sometimes it makes us leave the logic and embrace comfort in how we spend money. We all know how commons is the situation of financial frustration across the world. People nowadays do not keep control of their spending behaviour.
- Look at the credit cards, and they are in plenty with multiple deals. Many people keep multiple credit cards and also max them out and even miss repayments. All this create a big mess of pending debts and cause debt trap.
- Many of us are in the habit to borrow money desires and not for needs. From weekend trips to wedding gifts and expensive clothes, we take loans for almost everything. Thanks to the convenient online borrowing that makes availing funds so easy that we stop thinking about the reason.
- Online transactions do not let us realise the wastage of money. The currency goes so smoothly that we think ‘oh its ok’ next time I will not spend more. But in reality, things are always upside down. Comfort makes us spend more. From movie theatres to holiday booking, anything we find convenient makes us use money extravagantly.
We need to understand the technology is for our ease and not to make us lazy or irrational about money. We should keep control of financial behaviour and keep more focus on how a particular financial activity can affect us.
Easy and smart saving as well as investment
People indeed tend to more due to more automated and easy online money spending habits. However, on the other hand, it also has blessed us with multiple choices that improve our saving habits.
- Budget planners help us detect unnecessary expenses and can avoid them from next time
- Robotics offers us rational financial advisors that help us make investment decisions.
- The investment world has become more predictable with online analytical tools
- Saving apps and plans available online in our banking apps open the door to opportunity
In short, the sky is the limit if we want to manage finances while staying in good terms with the technology. Make sure you leave no stone unturned while exploring it for a better future.
The above points are the primary indications of how technology affects our financial lives and what the good are and the negative effects we should remember. You have the power in hand, and it is up to you how to use it smartly or irresponsibly.