With the advent of the internet and advances in software and security, managing your personal finances through your computer is safer and more user friendly than ever. Still, many people are hesitating to leave the land of paper and venture into the world of virtual finance. For those still on the fence, here are 7 reasons to start managing your finances online.
1. Security Advances:
One of the most common sense reasons to hold off on managing your money online is the worry that your personal financial information could be compromised. The idea of online I.D.’s and passwords falling into the hands of hackers to be used illegally is truly a nightmare scenario. However, with ever increasing competition for internet business, companies handling financial information are more serious and committed than ever in assuring that financial transactions occur in a safe and secure environment. While it’s always prudent to check out the security policies of any company offering online financial services, rest assured that the vast majority of companies you’ll be dealing with have adopted sophisticated security software for your protection.
2. No Paper Pile-up:
The most obvious advantage of managing finances via computer is the elimination of paper based transactions, i.e., the writing of checks. The ability to pay bills online is quickly making checks obsolete, along with the requisite mailing envelope and stamp(s). This feature alone can save the average household a fair amount of time and money. But that’s just the beginning. Instead of storing statements and transaction records in folders and filing cabinets, all information can be accessed online at the click of a mouse. Should you need a hard copy of an online transaction or financial statement you can print it on demand. Another upside of the no paper transaction is that virtual records do not have to be shredded.
3. Real Time Banking:
While the standard banking model of the past was dependent upon business hours, brick and mortar deposits and snail mail, computerized banking can be done in real time. This means that you have the ability to monitor your balances as often as you need to in order to stay on top of things. Should you need more money in your checking account, do a fund transfer online and confirm the new balances immediately. If depositing your paper paychecks is a hassle, ask your employer about setting up a direct deposit arrangement with your bank. With the ability to access your funds via a host of new web enabled devices, you can make purchases, deposits and payments from just about anywhere at any time.
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4. Added budgeting benefits:
If you find yourself in a situation where you need to restrict your spending to make ends meet and or gradually grow your savings, free online budgeting software is available to assist you in creating and sticking to a budget. The ability to track incoming and outgoing monetary transactions more efficiently via various online programs can be of tremendous benefit in helping you establish financial goals and develop viable strategies to help you achieve them.
5. Keeping better track of valuables and assets:
An important part of insuring your valuables and physical assets is to take pictures of each item to prove ownership in the unfortunate event that they are lost, stolen or damaged. Until now, the most difficult part of the process was deciding how and where these records should be stored. Using the internet, digital images of valuables as well as insurance policies and other critical documents can be stored safely and securely online, instead of in a safe deposit box or home safe which, in the event of an emergency may not be readily accessible.
6. Proactive investing:
When it comes to making and keeping track of investments, it’s easy to feel in the dark or out of the loop in terms of how your money is working for you. Utilizing various software packages that don’t require you to have an MBA to use, you can gain valuable insights and control over your investment portfolio. While it’s always a good practice to seek investment advice from a professional, online software can provide a more hands on experience by enabling you to buy and sell stocks directly and then track their performance without having to call a broker to ask how your money is doing.
7. Detailed reports:
Regardless of how large or small your portfolio is, the ability to accurately keep track of your finances is critical. Thanks to existing software packages which allow you to generate, view and print detailed financial summaries, reports and spreadsheets on demand, your computer can serve as a powerful tool in helping you to both understand and manage your finances more effectively.
About the Author: Jason Robbins is a freelance writer who specializes in personal credit. Robbins has written various pieces about credit repair and what to look for when checking out credit repair companies. Jason is not endorsed by or affiliated with LPL Financial.