How To Take Control Of Your Finances In 2019
The creator of Numbrs, an app that helps you keep track of your money, gives us his tips for a prosperous new year
It’s the most wonderful time of the year – although it might be a different reality for our wallets. The festive season sees money fly out of our accounts as we purchase extravagant gifts, throw wild parties and pack our shopping carts with enough food to feed a small army. Even as we speak, dining tables are groaning under the weight of joints of meat and truckles of cheese; velvet jackets and festive sweaters are wending their way by courier to eager customers preparing for the evening’s festivities. Beer taps are working overtime to deal with merrymakers toasting the year’s end with yet another round of expensive drinks. Little wonder that by the time that the curtain falls on December, it can be tempting to stick our heads in the sand and simply ignore our bank accounts.
This situation is exacerbated by just how complicated it can be to monitor our money in the digital age. The shift towards a cashless society has made life easier in so many ways, with a significant amount of all transactions now taking place via a simple tap of a phone or a credit card rather than the cumbersome exchange of notes and coins, but it hasn’t been without its drawbacks. Chief among them is the fact that it has rendered our money more abstract than ever. Rather than having to manage a finite quantity of physical cash, we’re now required to keep track of invisible money held in multiple online banking accounts, each of which requires its own individual app and unique login details. Without access to all of this information at once, it can be maddeningly difficult to see how much you actually have.
That’s what motivated the Swiss fintech entrepreneur Mr Martin Saidler to create Numbrs, a sleekly designed money management app that aims to solve the problem of losing track of your finances by aggregating all of your banking data in one place. It’s not the only app of its kind; the so-called “open-banking” legislation passed in the last year has made it theoretically possible for any banking app to do this. But because Numbrs is not a bank, it has a legitimate claim to impartiality compared to apps that are developed by banks, something that Mr Saidler believes gives his app an edge over the competition.
“In the past, I’ve been disturbed by the biased advice I’ve received from so-called experts,” says Mr Saidler, whose background in fintech put him in the perfect position to anticipate the growing demand for simple, impartial financial management tools. “I wanted something which would allow me to make my own decisions. I wanted to be in control. That’s why I founded Numbrs. I truly believe that by being in control of their own money and making their own decisions, our users will be able to gain real financial independence.”
Financial independence might seem like a distant dream, especially this close to Christmas. But with 2019 just a blink away, now’s as good a time as any to take those first small steps. Here, then, are five ways to stay on top of your money, according to a man who knows a thing or two about the matter.
01. AGGREGATE YOUR FINANCES
It’s rare that we keep all of our money in one place. The accounts into which our salaries are paid are not necessarily the same ones we use to buy our morning coffees or the ones from which our monthly standing orders are drawn. We might put bigger purchases onto credit cards and deposit whatever’s left at the end of the month into high-interest savings accounts. While none of this amounts to reckless financial behaviour per se, it can make it difficult to stay on top of things. And when we lose track of our money, it can start to seem less real. We’ve all bought ourselves a treat on a different card because “it doesn’t count”, despite knowing full well that it absolutely does.
This is where an app like Numbrs comes in. It provides a real-time cumulative total of all your accounts and a holistic picture of your spending habits, so you’re never more than a tap away from knowing exactly how much money you’ve spent and how much you’ve got left. When it comes to making financial plans and sticking to them, knowledge is power.
02. STAY INFORMED
In matters of finance, a little common sense goes a long way, and so, while it might seem glaringly obvious, it’s still worth pointing out that you shouldn’t spend money that you don’t have. One of the unfortunate effects of cashless transactions is that this is now, well, a much easier thing to do. A tap here, a tap there, and – whoops! – you’ve bought 12 flat whites in a single week.
The answer of course is to make a budget and to stick to it, but this is far easier said than done when money is so much more free-flowing than ever before. Apps like Numbrs automatically categorise your purchases, allow you to set overall monthly budgets and will notify you if you’re spending more in one area than you should. It’s no substitute for self-control, but it helps.
03. SET GOALS
The problem with setting financial goals is that they can be so distant as to seem laughable. This is especially true for first-time savers. Getting together the deposit for a first home might might take years; the thought of cutting back on those little luxuries that make life worth living for so long, and all for a payday that’s so far away, can be seriously demotivating.
But every journey starts with a single step, and only by setting targets now can you ever expect to achieve your future goals. Try starting small by setting an achievable goal for the end of the month. Once you’ve achieved that, set yourself a three-month goal, then a six-month goal and so on. The Numbrs app allows you to set targets and keep track of them easily, so you never lose sight of what you’re striving for.
04. PROTECT YOUR ASSETS
Nobody wants to have to smash the piggy bank because their cat got sick, but with the right kind of insurance package you can protect yourself from any such potential setbacks. The trick is to choose a package that suits your lifestyle. Do you use a lot of rental cars? An annual third-party policy will cost significantly less than what you’d pay for multiple individual policies over the same period of time. Do you do all of your shopping online? You’re at higher risk of online scams, so look for an insurance package that covers you from that.
Conversely, there’s little point in paying for insurance that you’re unlikely to ever make a claim on. Does your travel insurance cover winter sports, despite the fact that you’ve never set foot on the slopes? If in doubt, it’s worth auditing your existing policy to look for anywhere that you might be wasting money. Flexibility is crucial here, which is why Numbrs recently launched its own service, Numbrs Care. It’s a monthly subscription service, so you can adjust your required insurance package according to your plans.
05. BEWARE OF BUBBLES (AND DON’T FEAR DOWNTURNS)
It’s always tempting to look for shortcuts when saving, but get-rich-quick schemes tend to be fraught with risk and just as likely to lose you money as make it. Chances are, if you’ve heard of a good investment, then it’s already too late. Such was the case with Bitcoin, which was still attracting starry-eyed investors in the days before – and even after – it crashed from its December 2017 peak.
If you are thinking of investing, the advice from the Numbrs team is to do it with the utmost care. Put your money in companies that you understand and admire, and only think about selling stock when you’re sure it’s the right idea, rather than out of greed for fast cash.