The world of finance is no longer made up entirely of cash and handy plastic credit cards. In fact, we might not even need those for much longer.
Today, clever websites and cunning mobile applications are leading the way we collectively handle our cash, saving, investing and just about everything that comes along with money.
Here are just a few of the big players changing our relationship with money.
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Did you know that about 62 percent of Americans have less than $1,000 in their savings accounts, and 21 percent don’t even have savings accounts? To make saving easier, Digit stashes money away for you so you don’t have to think about it.
By securely connecting to your bank account, the program transfers small amounts ($5 to $50) from your checking account to your FDIC-insured Digit savings every few days.
Digit monitors your checking account’s balance as well as your spending habits to guarantee you never experience overdraft and only transfer money to your savings when you can afford it. Finally, Digit users are able to withdraw their savings 24/7, 365 days a year, with just one text, and without any fees. Though the program works with more than 2,500 banks and credit unions nationwide, Digit is currently only available in the United States.
Why do so many people struggle to save? Researchers at MIT, Harvard, and the University of Minnesota found that too many savers prefer the satisfaction of immediate spending over that of long-term saving. By rounding up the dollar amounts you spend with debit and credit cards, Acorns allows you to gradually save and invest change with day-to-day purchases. Acorns’ Modern Portfolio Theory, designed by Nobel Laureate Dr. Harry Markowitz, diversifies investment portfolios to carefully calculate and adjust financial risk.
Users can also establish automatic daily, weekly, or monthly transfers from their checking accounts to their Acorns profile to invest even more. The program requires a $5 minimum deposit, exempts youngsters (people under 24) and college students from their $1-a-month fee, and now offers desktop access for those who don’t want to invest on a tiny screen. The cons? Acorns charges 0.25 percent to those who invest more than $5,000 a year, and doesn’t offer retirement accounts . . . yet.
Bootstrappers from all industries understand the reluctance that comes with spending hundreds (if not thousands) on high-quality, comprehensive point-of-sale systems. Instead, small businesses can now rest easy with an inexpensive POS system that tracks sales progress for you and integrates everyday mobile devices.
Square is a portable and revolutionary way for business owners to easily accept payments, no matter where they are. Though the company started off by producing a simple smartphone magstripe reader, Square now offers a humble variety of products for the small business owner, including an electronic iPad stand (which stylishly replaces the traditional cash register) and a contactless and chip card reader.
Its free smartphone and iPad apps cleanly display products for sale, open and close tickets, which can be split amongst customers, provide space on which patrons can sign for card payments, and allow customers to tip in pre-calculated amounts so they can avoid tricky tipping math.
Though businesses pay 2.75 percent per swipe, those that pull more than $250,000 per year are eligible for lower rates, and compared to several other e-payment methods, Square deposits payments to a company’s bank account fairly quickly, in only one to two business days.
Ever wish there was a way to digitally pay others across international borders without pesky fees? Though relatively complicated below the surface, Bitcoin is simple to understand at the individual and business levels. According to the system’s main website, Bitcoin is “a consensus network that enables a new payment system and a completely digital money”, meaning it’s owned by no one and everyone. It’s an entirely new form of currency that can be swapped seamlessly between devices all over the world.
By downloading one of many Bitcoin “wallets” (applications available for smartphones and computers), clients can monitor their existing Bitcoin balance, send Bitcoins to others, receive Bitcoins, and more. Businesses can financially benefit from accepting Bitcoin by fluctuating transaction fees, enjoying fast national and international payments, and receiving secure payments that cannot be altered or reversed.
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Think of the number of purchases you make throughout your work day. After grabbing a coffee, buying gas, paying for lunch, having someone come in to solve your vexing computer problems, and maybe stopping by a convenience store on the way home, you’ve swiped your credit or debit card several times, not to mention the loyalty and gift cards you may use along the way. Coin lightens your wallet by consolidating access to all of your debit cards, credit cards, loyalty cards, and more and bringing them to one sleek device.
Coin’s 128-bit encrypted plastic card lasts approximately two years without needing to be charged, behaves like a normal credit card at traditional cash registers (and those like Square), and can be used separately from your smartphone or an Internet connection.
The device must be pre-ordered and is a work-in-progress: while the mobile application can hold an unlimited amount of cards, the device itself can only hold eight, and only cards with magnetic stripes can be uploaded. The pricey ($124) device must be replaced when it dies after two years, too, as it can’t be charged.
Budgeting is an essential part of any individual’s or business’s success, in an entrepreneurial setting, budgeting helps one set prices, configure forecasts, plan for financial emergencies, and more. There are hundreds of budgeting apps on the market.
Intuit’s Mint, however, is one of the most common, with accessibility from the iPhone App Store, Amazon, Google Play, and any Internet browser. Just like Digit, Mint securely connects to your online bank accounts to assess spending habits and identify individual needs.
The program then helps users build budgets with several spending categories based on those habit and needs. As it pulls data in real-time from a user’s bank statements, Mint creates colorful pie and bar graphs that display just how much the user has spent in a certain category or saved. Via email, Mint can notify users who are quickly approaching (or who have already surpassed) their budgets for a specific spending category.
While the free program is certainly convenient, Mint lacks the ability to track and organize cash payments, and sometimes transactions are thrown into the wrong spending category based on the text in your bank statement, however, this can be fixed manually.
Did you find it shocking that so few Americans have built up substantial savings? Worse, approximately eight out of every ten U.S. citizens are in some form of debt, and very few of them know how to manage their dues. ReadyForZero is perfect for anyone experiencing debt. Users link student loan, mortgage, credit card, car loan, and other accounts to ReadyForZero before letting the program generate a personalized debt-payoff plan.
By utilizing ReadyForZero’s browser site and iPhone and Android apps, users can keep track of their progress and regularly view their TransUnion credit score. The apps also provide notifications to remind users when particular payments are due up to five days ahead.
ReadyForZero is entirely free, only performs “soft” credit checks, which don’t affect your score, and congratulates users with fun, trophy-decorated emails as they reach 25, 50, and 75 percent payoff milestones.
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Now that you have so many virtual tools at your disposal, how will you take control of your or your company’s finances? What finance-savvy website and apps have you used?