The covid-19 pandemic has compelled individuals to manage their finances effectively. To capitalize on the given trend, financial institutions, and banks are offering customers new, advanced tools. However, what are the core elements for making a personal finance management software solution effective?
As per a study report, the global pandemic has made consumers care about their respective spending patterns -making them drawn to tracking expenses. The study has revealed that around 62 percent of individuals stated that the pandemic’s effect has left them with minimal choice but to track the overall expenditure. This scope can be leveraged by lenders to offer access to seamless personal money management solutions to end consumers to help them improve their overall financial health.
With the pandemic-promoted recession, there has been the advent of common financial hardships in the short term. At the same time, it is also expected to spur changes in the respective consumer behavior -especially with respect to personal finances in the long run. Financial services or lenders who understand the rapid shift and offer the target audiences the most effective ideas will emerge stronger from the ongoing crisis. It can be achieved by establishing a strong and reliable connection with the end consumers.
What is the Importance of Personal Finance Management?
At the individual level, financial planning implies well-structured budgeting as an ultimate way to regulate the respective money towards meeting financial objectives. The overall importance of a reliable personal finance management software solution is reflected effectively across all domains of both professional as well as personal lives of individuals.
Every individual and lender -irrespective of the respective financial capacity, should understand the importance of personal finance management tools to capitalize on the existing assets while achieving future goals.
What is a Personal Finance Management Software or App?
At its core, a reliable personal finance management or money management tool is aimed at helping individuals manage finances effectively. It helps lenders in integrating financial information of the client while segregating the existing data to deliver access to insightful information for improved financial planning.
A reliable personal finance management software tool can leverage different types of financial data in the form of input information while helping with core operations like budget management, portfolio management, investment tracking, records management, and so more.
A reliable personal finance management application can help in:
- Managing finances by tracking expenses and income
- Planning a budget and keeping track of savings
- Making payments for different types of services
- Making money through investments and savings
- Improving cash flow with the help of prudent spending, tax planning, and cautious budgeting
- Checking credit score
- Ensuring family’s financial security
Top Features of a Functional Personal Finance Management Software Solution
The presence of primary features tends to affect the overall user experience. Some of the core features of a personal finance management application you should look out for are:
Personal finance applications should include relevant information like banking accounts, credit cards, debit cards, loans, and so more to make sure that it is a one-stop application for all types of financial management solutions. As the application is known to deal with sensitive information, the application is expected to feature protective layers to ensure the optimization of data security.
Notifications and Alerts:
The feature is expected to alert the end users towards making payments on time while saving them from any form of penalty that might be incurred because of non-payment and non-compliance.
Categories of Expenses:
Categories of expenditures are known to assist users to understand as well as organize the overall spending in a sound manner. The presence of built-in categories helps in facilitating effective budget planning through the categorization of expenses under different sections like travel, food, and so more.
With the help of real-time updates, end users are effectively able to track the respective spending. Personal finance management tools can help in automatically adding new transactions while updating account balances in real time.
Tracking of expenses remains at the core of any reliable personal money management tool. The application helps end users in monitoring the respective expenses while keeping the same under control.
When credit score is included as the primary feature, it is essential as far as major purchasing decisions like taking a significant loan is concerned. The credit score also serves to be an important factor as far as major spending decisions are concerned.
Reports & Statistics:
The feature offers access to exhaustive financial statistics along with detailed analytical reports for a particular period. With the help of reliable financial applications, clients are able to leverage analyze the total amount spent on different stores.
Addition of the budget planning feature can help in winning more users while making the app distinguish itself from several others. Users can go ahead with setting daily or monthly financial budgets -helping them to save cash and planning big purchases. Daily, monthly, weekly, or annual reports with proper graphics are a major advantage for end users who are searching for an intuitive and functional personal money management application.
To align with the respective user experience, personal finance management applications can leverage artificial intelligence. Artificial Intelligence helps in analyzing significant volumes of data and converting them into meaningful insights. AI-powered algorithms allow advanced features in the form of smart savings.
Due to innovation, the concept of personal money making software is becoming increasingly significant in the finance industry. These applications offer a wide range of specialized features that are crucial to the financial situation of individuals. Most banks as well as financial institutions have come up with multiple lucrative financing approaches to help consumers to leverage personal finance management software -creating ample opportunities for market expansion.Also read: Top ways lenders can drive regulated customer financial management