Budgeting and saving money has always been a challenge. No matter how much money you make, it will always be a challenge to not spend as much as you earn. Some might think that when you make very little it is more challenging, but in reality, it can be just as difficult to not spend everything you earn when you make a great deal of money. Technology, however, is changing both the way in which we budget and save money and even how we spend it. Here are 5 ways technology is changing the way we spend and save money.
- Small change
There was a time when change jars or cans full of change were common. People recognized that they wouldn’t miss the leftover portions of a dollar much, but over time, those small amounts would add up to a pretty significant nest egg – and they did. Now, however, technology is making it easier than ever to apply this concept. Some banks will take an even dollar amount out of your checking and transfer any change left over from a debit card transaction to your savings account. There are even apps like Acorns, that will take leftover change from transactions and invest them.
Any financial planner will tell you that one of the first things you have to do in order to budget or save money is know where it is going. Online banking and a wide variety of budgeting apps are making it easier than ever before to track exactly where our money is going and what we are spending it on. Debit cards and online banking also make it easier than ever to isolate specific types of spending, such as on dining out, monthly memberships, bills and groceries. Being able to get a full picture of exactly where all your money is going and what you are spending it on will help you figure out what to keep and what to cut when it comes time to make some changes.
At one time, when you wanted to take a vacation, you would go to a travel agency where they would book travel tickets, a hotel and possibly even a rental car for ostensibly the best deal. You would have no way of knowing, however, whether you really got a good deal or not. Today, you can not only get specific information online about any hotel you might think about staying in, but there are a number of sites like Kayak and Priceline that will compare hundreds of options to give you the best deals.
Let’s say you are working in Pennsylvania and a firm in Colorado offers you a job at almost three times the salary you are making now. That may seem like a great deal until you do some research online and realize that the cost of living in Colorado is nearly double what it is in Pennsylvania. 20 years ago, you might have moved halfway across the country on the promise of what seemed like a huge pay increase, only to get hit with a nasty surprise once you got there. Now, with a wide variety of research tools available, you can research the best places to live in Colorado – or anywhere else you want or may be asked to move to – to get a much better idea of what a move will really earn you versus what it will cost you. All of which will help you make much more informed choices, as well as helping you budget, save and plan better.
- Cheaper, better services
At one time, if you wanted someone to hold on to your money until you needed it, your only option was a bank. This didn’t used to be such a bad deal since banks generally put your money to work and paid you a small percentage of the interest they garnered from doing so. Eventually, however, banks gave you less and less and took more and more and eventually even started charging you for their service of holding your money and making it available to you wherever and whenever you need it – even though they are still making money off your money. Now, there are a wide variety of online options to manage your money far better than allowing a bank to hold it. From net wallet options like PayPal to completely online banks like Ally and ING Direct.