How Online Banking Can Help You Budget Better
With easy-to-access data, convenient automatic transfers, and a variety of ways to organize your money, online banking can revolutionize the way you budget. Here’s a look at a few easy tips to help you budget better with the power of technology.
Set up sub-accounts
Even if you’re putting money away in a savings account, it can be difficult to visualize how you’ve earmarked your money. You can change all that by setting up a few sub-accounts, each labeled with a savings goal. When you put your money in sub-accounts, you can easily see how your vacation fund is faring in comparison to your future home’s down payment fund. Forbes contributor Emily Guy Birken explains that you may be more motivated to save — and less tempted to withdraw your funds for an impulse purchase — if you can clearly see how your savings are allocated.
Make expense tracking easy
When you’re making a budget, it can be tedious to gather all of your bills and receipts to figure out how much you’re spending each month. Online banking puts your transactions at your fingertips, so it’s easy to see how much money you’re putting toward different expense categories. Bankrate contributor Rene Bennett states that you can even link a third-party budgeting app, like Mint, for a clearer picture of your finances. With no-hassle access to data on your spending habits, you’ll have a better idea of where you can trim excess expenses.
Stash away money with automatic transfers
If you have trouble remembering to put away part of your paycheck into your savings, automatic transfers can help you reach your financial goals. With the power of online banking, you can set up automated transfers to move money on a routine basis. According to Birken, many financial institutions offer flexible schedules, such as the option to set the transfer to occur on the same day that you get your paycheck, so you don’t accidentally overdraw your account.
Pay your bills through online banking
If you’re looking to track your spending and improve your credit score, consider using your financial institution’s online automatic bill paying service. To get started, you’ll need some information on the bill you’re paying, such as your account number and the address of the entity you’re paying. Once you’ve got your payment information set up, you can choose between one-time payments for fluctuating expenses (like your electric bill) and recurring charges (such as a car payment that’s the same amount every month). If your bills fluctuate and you have to manually pay them every month, Birken suggests signing up for your financial institution’s bill pay reminders.
Stay aware of your money with low balance alerts
With debit cards, online shopping, and peer-to-peer payments, it’s easy to drain your account. To prevent yourself from racking up overdraft fees, Birken suggests signing up for low balance alerts. With this feature, your financial institution can let you know when your balance goes below a specified amount. Typically, you’ll be able to choose between emails, texts, and push notifications, so you can receive real-time alerts in a manner that best suits your lifestyle. To set up these notifications, log into your financial institution’s app and look for a “manage alerts” or “settings” page, which should enable you to activate this feature.
Need help getting your alerts, accounts, or automatic payments set up? Contact your financial institution for guidance on getting the most out of your online banking experience.