Tuesday, July 21, 2009
Low-Tech Money Tools: Tried-And-True
With the wide range of technological tools at our disposal, from mobile banking to budgeting using software or Web sites, many young adults are in the same boat: having never balanced a checkbook or paid a bill via snail-mail. A recent Wall Street Journal article points out that, while the benefits of technology are considerable, the digital world may make it hard for some to get a tangible, firm grasp on their finances.
So, here are a few tried-and-true, "old school" financial tools that can help you lay a solid financial foundation:
A pen, a pencil and some paper. These are the basic tools needed to see your financial situation (such as assets and liabilities) and plan a budget (set spending limits).
Envelopes. These are another old-school budgeting staple: You can control expenditures by divvying up cash from your paycheck into envelopes marked for various spending categories, such as groceries or entertainment. Unlike credit cards, when you use cash you can physically see your funds being depleted.
A checkbook register. These are the booklets in a checkbook where you are supposed to record checks written, as well as deposits. Even if you're not writing checks, you can record ATM withdrawals and debit-card spending--adding or subtracting all those activities from your balance.
When your monthly bank or credit union statement arrives, compare your detailed transaction history to the statement to make sure there has been no fraudulent activity or mistakes made.