Based on the present setting in the financial technology industry, there is a relatively new group of fintechs that has come to life which specializes in improving the health aspect of users’ finances.
These companies are utilizing modern technology solutions to give consumers new ways of achieving better financial wellness, hence enhancing people’s choices and control over their lives. In this article, three leading fintechs that are driving this change in the United States have been discussed with tools that they offer varies.
Innovative budgeting solutions: Empowering consumers with clarity
Budgeting is one of the most basic concepts of personal finance management, which seems to elude a large portion of the population in America. As we shall see, a number of fresh entrants are rising to fill this void with easy-to-use tools that help to give shape and direction to the management of one’s affairs.
Another type of fintechs operating in this niche is Mint for budgeting that unites all the necessary components for money management. Mint links with bank accounts, credit cards, as well as regular bills, organizing the records into categories for easy analysis of the expenses.
Another important stakeholder is the online- based company called You Need a Budget or YNAB for short. But, YNAB has a different strategy where the essence is put in giving each dollar a specific job to do.
This method makes the user to assign the income in specific areas of expenditure and saving/investment as they adopt the strategy of taking action rather than reacting to another’s result. Exactness of YNAB is also complemented by YNAB’s educational tools and classes that improve users’ financial literacy.
The implication of these budgeting solutions is profound worthy of the effort involved in implementing them. Since the two applications inform their users instantly and provide customized recommendations, Mint and YNAB enable users to understand where they are overspending, how to set relevant goals, and monitor their success.
These tools are especially helpful for those who struggle from paycheck to paycheck since they rationally divide the limited means. Lastly, several of these fintechs are not simply making budgeting easier; they are making the very concept of a budget a different and better thing.
Innovative savings platforms: Making saving effortless
Personal savings represent an important facet of people’s finance, yet, it seems almost impossible to achieve for most. Indeed, such technologies bring about radical changes with regards to the savings procedures and as such, makes such a practice natural.
Acorns is one of the pioneers of the micro-investing and saving application. Acorns automatically saves pennies from the users’ purchases and invests in various portfolios as the amount is rounded up. Thus, the savings and investments offered are closely interlinked, and users can accumulate wealth without drastic alterations to one’s daily routine.
Their money market accounts and other saving options are cutting-edge comparing to the face-to-face local banks. Chime offers a direct deposit option where a portion of income earners’ salaries is saved without their interference as well as a roundup savings feature where change from purchases is saved into a Chime savings account.
They are new savings platforms that affect the users’ financial status by easing saving discounted rates. Acorns equalises investment by enabling the majority of people with little capital to invest in the stock market and compound their wealth.
The automated savings in Chime means that users develop good habits of saving and can create their savings for any form of emergency. These fintechs, through making saving automatic and simple, help the users to save money and plan for the future.
Credit building and management: Enhancing financial stability
Credit scores are important when it comes to evaluating them; one uses them in such areas like loans and even interest rates. There are new services that fintechs started introducing to assist the people in the proper credit management.
Self is a leading Fintech whose specialty is credit builder loans aimed at assisting people who need help with credit repair. Targets open a small credit line with the credit building company; they pay the credit building company monthly premiums that the credit bureau reports as credit utilization.
Another application that deserves to be mentioned is called Experian Boost, through which positive payment histories from utility and phone bills can be reported on credit reports. This can mean that some people who have been on time payment wise, but do not have any credit accounts will see their credit scores jump almost instantly.
These products are large financial improvement devices for the audience it targets with credits. Through credit-builder loans, Self avails structured credit for the credit-inexperienced or those with a damaging history to build credibility, thus improving the quality of credit in the future.
Experian Boost is convenient and easy to use and can quickly help users increase their credit score and obtain credit facilities, loan, credit card, and reasonable interest rates.
Thus, by increasing credit scores, such fintechs contribute to credit wellness and, therefore, financial wellness, which is critical in significant life purchases and in an emergency.
Innovative debt management tools: Simplifying debt repayment
This area reflects yet another problem found within the American population – the issue of debt and its management brings stress and instability into people’s lives. New generation of fintechs is entering the market with fresh solutions to aid people in their discharging of the debts they owe.
Tally is an industry-first fintech, which does credit card payoff. Tally makes it possible for a user to consolidate all outstanding balances in a single credit card with a lower interest rate and pay for it in the most efficient manner. It also has an important component of offering recommendations on how to pay off and avoid using credit, to remove the eh guessing out of it.
Another innovative platform is Payoff, for which the main product is personal loans to pay off the credit card balance. Payoff offers credit-building loans at a fixed rate that’s typically lower than the user’s credit card interest rate helping them convert their debt into easily manageable monthly installments.
Debt management tools can be argued to possess the attribute of being potent agents of change, since they simplify the process of paying off debt and reduce stress associated with debt. Hence, through automation, Tally users do not pay any bills in a given due time period needed to draw interest; Tally’s interest rates are comparatively cheaper.
Payoff’s custom loan approaches contain the roadmap of how to get out of debt as well as the general help to become financially stable. Thus, many fintechs providing debt repayment solutions help to ease the process, which decreases the users’ financial stress and lets them work on other areas of their finances.