It’s easy to spend your hard-earned money after working eight hours a day. Work hard, play hard – correct? However, it’s exponentially easier to not keep track of your spending habits.
According to the Journal of Accountancy, the American Institute of Certified Public Accountants (AICPA) assigned Harris Interactive to conduct a national telephone survey regarding online usage and its correlation to online banking services. The survey states that 17% of 18 – 34 year-olds check their bank accounts daily, which is less than one-third of the 54% of Americans in the same age group who admitted to checking their social media accounts (Facebook, Twitter, Instagram, etc.) at least once a day.
Why is it so easy to forget about your financial position? Technology has advanced so much within the last couple decades – with smartphones, computers and tablets – that mobile banking should be an automatic habit by the time a consumer hits his 20′s.
So why do we choose to ignore our finances?
Debit and Credit Card Usage
The use of plastic cards as opposed to cash has contributed to the lack of personal financial awareness for consumers all over the world. Because a debit or credit card doesn’t physically state the balance of your bank account or credit limit on the card, it’s extremely easy to disregard the fact that you’re spending YOUR money.
Without a visual representation of how much money you’re spending compared to how much money you have in your account, you subconsciously spend when using your card.
How do we fix that?
A simple trick to prevent subconscious spending is to ALWAYS USE CASH and save your loose change. Leave your plastic cards at home and bring a specified amount of money when you exit the house. Consider your money “the budget of the day.” By physically holding money, you have complete control over how much money you have. This is significant because if you are aware of how much money you have left to spend, you will subconsciously not want to spend it because cash feels really awesome to hold.
Time is Money
Many of us ignore our financial standpoint simply because it takes too much time. Consumers can drive to the bank to deposit and withdraw their cash. Individuals can also keep track of every receipt whenever they make a purchase and subtract it from their bank account. People can also balance their checkbooks to have a clear representation on their finances.
However, that takes time and as most business professionals and consumers know, “time is money.”
How do we fix that?
Fortunately, as the Apple iPhone and Google Android dominates the smartphone market, so do their applications. Banks have realized that consumers are with their phones nearly 24/7 hours a week and have accommodated them with online banking applications.
The rise of mobile banking benefits consumers and banks everywhere; mobile banking and its affiliated network of apps allows people to take care of their finances without having to worry about a bank’s hours of operation or standing in line at the teller. Consumers can now check their balances, deposit checks, transfer money and pay bills – all from their smartphones.
In essence, the current generation has no excuses for not checking their financial position. Your money is not something to procrastinate. Twitter can wait, debt won’t.
Finance is not fun
No matter how many free things there are to do in the world, living life happily costs money. Productive hobbies usually account for repeated spending. Traveling is expensive, especially when going with family members and friends. Even buying nutritious foods and exercising takes a toll on your financial health.
Life is fun. But evaluating your finances – and coping with debt – is not fun.
It can be extremely stressful knowing you owe anybody – whether it be a business, the government or another individual. To add, the brain and body is naturally wired to deal with any sources of pain or discomfort – including stress. Therefore, it’s very easy for anyone to ignore their financial situation.
How do we fix it?
Start by acknowledging your spending habits. Then recognize your income and the bills that need to be paid. Check your bank account every morning. Realize that if you’re working for ten dollars an hour, that every ten dollars you spend is an hour of your life you cannot take back.
Turn budgeting into a contest. Challenge yourself to spend as little as you can weekly – then challenge your friends.
Don’t use your extra money for binge spending. It’s easy to want to reward yourself for doing well. However, instead of using that money to buy an expensive item, use it to pay your debts. A debt-free life is much more enjoyable when you view it as the ultimate reward for working so hard.
Don’t ignore your finances!
With the advanced technology available today, it’s hard not to keep track of your finances. It’s just easy to ignore. But don’t do that to yourself – you deserve to live your life with little-to-no stress. Forget the plastic and use cash. Use your mobile banking application every day. View financial freedom as a reward. Live life happier.