I've been struggling with my personal finances for a while now and I figured someone might help me out. I've read so many books and tried every app and I'm just not getting the results for so many reasons. I attempted a retrospective on why my personal financial management has failed so far and here's what I've boil it down to and what I want to solve my problems.
-
Problem 1
- Apps like Mint, YNAB, Digit, etc. expect me to know what financial decisions to make. They are unopinionated (what I like to call "dumb") tools that leave the decision making process up to me.
-
Hypothesis 1
- This flexibility to make the decisions can be liberating if the user knows what financial decisions to make but can be daunting to beginners or financially uneducated users. There are people like me that are not extremely financial educated on personal finance who don't have a personal financial plan. They don't understand debt, interest rates, saving, etc so they don't know how to use these dumb apps properly.
-
Conclusion 1
- I want an app much like Mint that connects to my accounts to generate a financial history and then takes me through the steps from /r/personalfinance/wiki/commontopics and the flowchart (direct link to flowchart -https://i.imgur.com/lSoUQr2.png). The goal of this being to educate me on what financial steps I should be making and guiding me through each step in the process.
-
Problem 2
- Even if someone knows all the personal finance best practices and advice, executing on that knowledge is extremely difficult over the long term. Being consistently financially responsible is mentally taxing and usually boils down to mental fortitude and the ability to delay gratification.
-
Hypothesis 2
- Executing a financial plan has some unnecessary friction. One being the daily grind to stick to a plan especially when it requires putting off gratification. Another unnecessary friction is that many financial tools are not optimized for consumer benefit. In some cases, financial tools have opposing incentives to their consumers because they make money from their consumers’ inefficiencies. For example, the extremely low interest rates on savings accounts.
-
Conclusion 2
- Instead of just trying to educate me into making smart financial habits, I want an app to automate the right decisions for me based on my situation. But I want an app that's aligned the business model in a way that it's incentivized to help me make the best financial decisions for me. Then the app would have every reason to remove and reduce every bit of friction.
Am I the only one who thinks personal finance shouldn't have to be as hard as it is? What am I missing?
Submitted November 19, 2018 at 11:50PM by iduvall https://ift.tt/2zlRB2i
