India is home to one of the largest young populations in the world. Nearly one in four persons is a millennial. Having grown up against the backdrop of rapid tech disruption across sectors, it is fair to say that this generation comprises true digital natives who turn to technology to address almost every need or task, including management of their finances.
Millennials owning multiple bank accounts isn’t an uncommon phenomenon today. Combine that with multiple cards and digital wallets, and tracking spends becomes significantly harder. Given the quantum and frequency of cash outflow an individual experiences on a day-to-day basis, managing money becomes critically important.
Apps helping the young manage money effectively
Money management apps make it easier for customers to manage tasks such as tracking their expenses, bills and budgets. These apps are extremely easy to use as they are fully automated. Customers need not add transactions manually and can rely on the technology built into their smartphones to seamlessly capture and organise their financial data. Money management apps are helping their customers to take important financial decisions and manage their money better on the go. Let’s see how.
Tracking spending habits
Money management apps can help customers identify their spending habits. Customers get a clear picture of how much they are spending each month and how much they are earning. These apps can also automatically classify transactions into specific categories such as Groceries, Shopping, Entertainment and Travel to give customers a deeper understanding of what they are spending on. All this happens automatically, avoiding the hassle of manually adding every transaction.
Understanding their spending habits helps customers to take corrective action based on this data and insights.
Also read: COVID-19 second wave: How to keep your money safe?
Since these apps offer visibility on income and expenditure, they can help the customer easily execute budgeting. Customers can set monthly budgets to help them reach their financial goals. Corrective decisions can be taken on the go to avoid unnecessary spending and ensure adherence to budgetary limits. This helps in inculcating an attitude of savings in the customer’s mind and encourages a perspective of financial discipline.
Paying bills on time
Money management apps also provide for monthly bill tracking. Customers are notified of bill payments, such as electricity or credit card bills, preventing the incurrence of late payment fees. Customers that frequently use credit cards may have experienced the steep costs involved in making delayed payments. A timely notification on the app goes a long way in reminding customers.
Tracking shared expenses
From car-pooling to rent sharing, young Indians are utilising the benefits of living in a close community. Students and working professionals in cities share flats with co-workers and friends to save on rent. These individuals share expenses, which are often hard to track manually. The conversations involved in settling dues could also be awkward.
Money Management apps can be used to split expenses between friends, colleagues and roommates. The tracking is automated thereby making it instantly easier. Amounts owed can be settled between those concerned in a streamlined manner, mitigating the awkwardness that is otherwise experienced.
The changes brought on by COVID-19
A Deloitte report suggests that the pandemic has added to many stress drivers for young people. For instance, 46 percent of millennials in the survey reported stress regarding their long-term financial future. Salary cuts and job losses have aggravated their concerns.
Money management is high on the minds of the youth post-pandemic. The need for effective tools to manage finances is being felt now, more than ever before.
Money management apps can solve a host of financial problems for customers: from budgeting and splitting expenses to reminding you on bill payments. Many apps also offer other financial products such as personal loans wherein customers can avail of an on-demand credit facility with personalized EMI terms in a matter of a few clicks.
The pandemic has taught one and all the significance of money. Managing this asset is of utmost importance. With these apps, customers can have hands-on control over their finances, as they work towards achieving their financial goals.