Technology has provided us with many tools that make our lives easier on a daily basis. The question is, does easier mean better? The answer to this question will depend largely upon how you use the technology. I am going to focus here on the technology of payment apps.
The days of carrying around cash and even credit cards are starting to wane. It used to be a must to make sure you had both with you at all times. Now with technology like Apple Pay, Venmo and Paypal, it is less necessary. At times, when I was a kid, it used to take time to get reimbursed from friends or family if you needed to help them out and pay an expense for them if they forgot their cash or credit cards. With the apps mentioned above, you can literally pay people back in seconds, assuming you have the money in your bank account or credit available on a credit card.
Convenience like this certainly can make our lives better, but there are unintended consequences that come along with these technologies. They allow you to spend money that you may not have necessarily budgeted for that month. When you used to have to go to the bank to take out money for expenditures and actually hand the money to someone else for an expense it gave you a true sense that this money was being spent. Now, with a few clicks, the money is transported from your account to your friend or a vendor. This does not provide you with the same feeling of incurring the expense.
I am not saying that you should not use these modern-day payment options, as I use them all the time, but for your financial wellbeing, it is important that you understand and do not lose sight of what you are spending when using these tools. They are designed for convenience and for those looking to capture your dollars more easily. Whether you write a check, pay cash, use a credit card or use a payment app it is important that you have a clear understanding that this is an expense and must be considered as part of your monthly budget.
Do not allow these modern day conveniences to derail your financial plan or budget. There are tools out there that can help you monitor your budget and will take these types of payments into account. Technology is excellent, as long as it is used as a tool to help us in our everyday lives. Be aware that they can also have a detrimental effect too.
Budgeting is an important part of any financial plan. We would be more than happy to discuss with you tools that may help you track, maintain and stay on course to build your financial future. Please feel free to contact us, Mitlin Financial, at (844) 4-MITLIN x12 and be sure to share this article. Let friends, family and business acquaintances that we are here to help them too. We look forward to helping you, and them, work on getting financially fit.
This article represents the opinion of Mitlin Financial Inc. It should not be construed as providing investment, legal and/or tax advice.