How To Stick To Your Budget In The Age Of Digital Payments

MINNEAPOLIS (WCCO) -- Advances in technology and apps has made it easier than ever to swipe and pay. With that ease comes with an increased chance of breaking your budget. Financial adviser Justin Halverson said you can utilize today's technology while watching your wallet.

Smart phones changed the game when it comes to swiping. It's no longer just credit cards used to pay for goods. There is Apple and Android Pay.

"I just paid the neighbor kid that mows my lawn with Venmo which is a company owned by PayPal, cash app. There's a number of different ways to ultimately pay for things or pay other people electronically, bitcoin even," Halverson said.

Credit card information is stored with ride share services and online shopping.

"I certainly think it makes our lives more convenient. The problem a lot of people have today is they don't live within their means," Halverson said.

He said it's more important than ever to keep track of your spending and staying financially responsible.

"It all comes down to having a budget. A budget is really more telling your money where to go versus holding you back to holding you off of buying things you shouldn't buy," Halverson said.

Start by looking at your income sources to know what you are working with. Halverson recommends paying yourself first. Start by putting 10-percent into a 401(k) or some kind of savings like a Roth IRA. Then look at your fundamental and fixed expenses.

"Do you have rent or mortgage payment? Car payment, how much are you spending a month on groceries, your utility bills," Halverson said.

What's left can be used as discretionary spending.

"You've got to enjoy yourself along the way but don't enjoy yourself so much today that you forget about your future," Halverson said.

He suggests throwing out the traditional checkbook. Online banking or an app on your phone, like Mint or Personal Capital, can do the work for you.

"They pull in all of your transactions from all of your bank accounts. From your credit card statements, from your brokerage accounts all into one place, so with the one snapshot on your smartphone you can see your overall financial picture and boil it down to your budget and your investment savings and get a sense of being on track," Halverson said.

Halverson said if that still doesn't work it may be time to pull back and go with an all-cash budget. That way you know when the money runs out.