The Finatical
Week of August 15th, 2021 - Digitizing Money Management, Inflation Worries, Job Openings
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FinaticTips - 3 Ways to Digitize Your Money Management
1 - Budgeting Apps
A budgeting app is a software application that you may access from your computer, tablet, or mobile device to track your personal finances. This may include tracking your income, expenses, savings, debt payoff, investing, or a combination to improve your financial health. Budgeting apps are different from accounting software, which is typically for a business’s income and expenses.
Budgeting apps may sync with your financial accounts to offer an overview of your situation as changes happen. The most common use of budgeting apps is to track spending through a synced checking account. Many people aren’t aware of how much money they spend every month, making changes more difficult. A budgeting app may organize spending history into categories to identify trends, making users aware of their habits over time.
Every budgeting app is different in its own way but here are the common functions that a budgeting app can help you with:
Tracking spending. Budgeting apps that link to your checking or credit card accounts can automatically record new purchases and other debit transactions for you.
• Paying bills. Similar to the automatic bill payment feature your checking account or credit card might offer, you may be able to use a budgeting app to pay bills on autopilot each month.
• Tracking bill due dates. Due date trackers can help you avoid late or missed bill payments and this is another feature you can find with budgeting apps.
• Saving toward financial goals. Some budgeting apps have savings features. For example, you may be able to set up savings “buckets” and schedule automatic deposits or “sweep” money you don’t plan to spend into a savings account.
While browsing your best fit for a budgeting app, you might find a lot of paid ones. While paying for a budgeting app might seem counterintuitive, there are a lot of different pros and cons involved and you can evaluate those to find your fit. You can always try free trials to see if paying for a budgeting app is actually worth it.
2 - Tax Filing Systems
Everybody wants to get filing taxes over with quickly, with as little fuss as possible. That’s why online tax software comes in very handy at tax time. Most people want tax software that’s either free or inexpensive. Tax software programs allow individuals and business owners with little to no tax knowledge to accurately file their tax returns, get their maximum owed refund, and avoid IRS audits. What’s more, tax preparation software makes online tax filing a breeze by walking users through every step of the process and checking for errors and deductions along the way.
The best tax software programs make it easy to quickly do your taxes accurately. They also come with fair pricing for your tax preparation needs and good customer support if you have any questions along the way. If you get really stuck, the best tax software connects you with someone who can answer tax questions unique to your situation.
Here’s what you should look for in an ideal tax filing software:
Ease of Use/ Convenience
Costs and Fees
Free Filing Options (Many tax online software providers offer an advertised free tax filing version for simple returns on their website.)
Customer Support Options
3 - Boost Your Credit Score
Your credit score is an extremely important part of your financial life. It's a number between 300 and 850 that is calculated based on several factors, including your payment history, credit inquiries, credit usage, length of credit history, and any new credit you might have. If you’ve read our earlier newsletters, then you must be well aware about the importance of having a good credit score but achieving that score can be a hassle for most people. You are going to have to pay bills regularly, lessen your debt, maintain a low debt-to-credit ratio among other things. But you do not have anything to worry about. You can easily manage your credit score needs by using a simple credit monitoring platform that you find most-suited for your needs. While you are probably still going have to do a lot of work on your own, credit monitoring services can help you keep your credit score on track.
Credit monitoring services do just what the name says — monitor your credit. They track the credit history shown on your credit report, then alert you of changes via email, text or phone. Granted, you can do this on your own, but these services provide an automated and faster way to track changes to your comprehensive credit file.
Here are some of the activities that are reported by credit monitoring services:
Personal information on the dark web
Public records
New address or name changes
Balances and payments
New accounts
Hard inquiries
Just like budgeting apps, credit monitoring services can also be paid and you can try them to find your best fit. Of course, you should keep in mind that just because a service is paid doesn’t necessarily mean that it is any better.
FinaticTrends - 2 Financial Trends
1 - Inflation Worries
The Fed last week removed our fears by stating that the current inflation is most likely transitory and not exactly something to worry about and the same has been said by many economists. But what the Fed also stated was that the inflation will depend upon the course of the virus and nothing is certain. Some people do believe that the inflation crisis is likely to surge and become a problem and they do have reasons for thinking that. The increasing money supply in the US and many countries in Europe can be an argument in favour of ruinous inflation. However, much of that money has been saved. This means that the velocity of money, which is the number of times a dollar changes hands in a period of time, has fallen sharply during the pandemic. Consequently, the surge in money supply has not been inflationary, at least not yet. The same has been true in Europe. The recent global supply chain disruptions increase worries about inflation. Due to the current circumstances, it will be hard for global businesses to boost their trade to sustain global demand and doing so in time will be very crucial to not accelerate global inflation. Labor shortage is also being seen as an important factor as labor shortage can lead to upward pressure on wages and can heighten inflation. The only measure that countries have in such circumstances is to do everything to completely eradicate the virus.
2 - Increase in Job Openings
The US economy continues to recover from last year’s recessions as job openings surge over 10 million for the first time ever. By industry, leisure and hospitality show one of the highest level of job openings at more than 1.6 million. Health care and social assistance has 1.5 million openings. This record-breaking increase in job openings has been witnessed since the last three months and the labor demand is stronger than ever. With this news, US jobless claims are also falling and they have reached a low of 375,000. This is obviously very good news and it is good to see that the US is well on the path of full recovery. The job numbers are still pre-pandemic levels by a wide margin but the US economy is slowly making good progress.
Financial Guidance
“Rich people believe ‘I create my life.’ Poor people believe ‘Life happens to me.’”
— T. Harv Eker
Financial freedom starts with having the right mindset to pursue wealth and all of your audacious goals. This quote reminds us that people who are rich have an active role in designing their dream life. They’re not passive players in the game of life or building wealth.
Money Fact
The world's richest 1% have more than twice as much wealth as 6.9 billion people.
That’s some unfathomable inequality.