By Debbie DiVito, CPA, Content Manager, Women & Co.
It's trite, but it's true: As women, we wear many different hats. Off the top of my head, I can think of five: Employee. Fiancée. Daughter. Yoga enthusiast. Friend. And those are just the first that come to mind. Is the same true for you? I'm just taking a stab at it, but I'm going to guess that if you're reading this, there's a good chance you A). wear several hats yourself, and B). take a serious interest in your personal finances and how they affect your life. But what I'm also going to go ahead and assume is this: as a result of having a full life (and full schedule) you most likely don't have ample time to devote to managing your finances.
...and that's okay! Because, just like we rely on technology to help manage our personal lives, we can also use technology -- in the form of personal financial management (PFM) tools -- to help simplify and take control of our financial lives.
But how do you know which PFM tools are right for you? According to Citibank's resident experts on the topic, when considering a particular PFM tool, you'll need to evaluate three things: the level of control it gives you, the amount of convenience it offers, and how secure it is. Want to learn more about how PFM tools can help simplify your life? Keep reading to learn what to look for.
They Can Give You More Control
Scott Schilagi, senior vice president of Citi Internet & Mobile, says financial tools will help you gain greater control over your financial life. But how? According to Scott, PFM tools can provide you with a holistic view of your finances, and you can use that information to get deeper insight into your finances than you ever have before.
When you're equipped with that level of information, you're able to have more control over the way you spend and save, resulting in the ability to be more disciplined in your relationship with your finances. For example, using financial tools, you can see your spending (and saving!) patterns and habits, create budgets (and track how you're doing against your budget), and set alerts to let you know when you've gotten off track. To learn more about the different PFM tools and how they can help give you more control over your financial life, read "The 5 Benefits of Using Money Management Tools."
They Offer You Convenience
Gina Avila, senior vice president of Citi Internet & Mobile, says convenience is another major benefit that personal financial management tools offer. There are two main reasons:
PFM tools can save you time. With PFM tools, you have one, convenient snapshot of your financial life, requiring fewer places to go online, since you can see all of your accounts in one place. According to Gina, "We're used to a ledger approach. Women are used to thinking, 'I've got 401(k)s at three different places, a mortgage with one bank, a savings account with another, and investments at a brokerage firm.'" But Gina says PFM tools change all of that. "Personal financial management tools allow me to link accounts, see everything in one place, set budgets, and set financial goals. For example, if I want to go to Tahiti next year, I need $10,000 to do it up right. I can use PFM tools to see what I need to do to make that happen.
PFM tools are available where, when, and how you want them. PFM technology is another feature that ups the convenience factor. There are PFM apps, and many PFM tools are available in both tablet-friendly and mobile-friendly formats. You can also use this technology to get immediate updates, receive account alerts, and set up automatic bill pay.
They Can Provide You with Security
Michael Marion, senior vice president of Citi Internet & Mobile, shared his opinion on money management marketplace trends:
"The trend in the marketplace is for financial providers to allow their customers to aggregate financial information in one place. While most PFM tools don't yet allow you to transact among your aggregated accounts, you can see all of your spending and saving."
According to a Forrester North American Technographics Financial Services Online Survey, customers are taking their financial providers up on the offer: an overwhelming majority (72 percent) of U.S. adults who have used online money management tools have done so on their bank's, credit union's, or other financial provider's website. Other respondents indicated that they relied on third-party aggregators, such as a credit card provider's site, a non-bank provider site (such as Mint or Yodlee), a brokerage firm site, or at a financial portal website, such as Yahoo! Finance or MSN Money.
But why? Michael suggests that some people may feel safer aggregating their finances in a place they already trust, as opposed to a new third party aggregator. But there's also something to be said for the security that regulated financial institutions bring to the table. According to Michael,
"Third-party aggregators may ensure your anonymity by not asking for certain data (such as your name or account number), but you're ultimately giving third parties -- who are potentially not regulated by the Fed, FDIC, or the same kind of controls your financial institution would be subject to -- access to your personal financial information."
About the Author:
As Women & Co.'s Content Manager, Debbie is responsible for creating original editorial content for Women & Co. In her role, Debbie couples more than seven years' experience supporting clients in the financial services industry with her passion for writing about important financial concepts in a way that is both unintimidating and fun. Debbie is a Certified Public Accountant, has undergraduate degrees in Finance, Multinational Business Operations, and Spanish from The Florida State University, and holds a Masters degree in Accounting from The University of Virginia.