Online or Real Person? When to Use Online Financial Tools
Submitted by MIRUS Financial Partners on February 20th, 2018The internet has changed the way we do almost everything in our lives. We do so many things online; it’s hard to imagine life before websites, apps, and online calculators. Online tools have taken over some of the most tedious tasks in our everyday lives. But one of the best things about the internet is that it offers you the opportunity to tap into all kinds of expertise in fast and inexpensive ways. Reading this blog, for example, is one way you’re using the internet to tap into financial expertise. In fact, there are all sorts of ways to bolster your financial knowledge online.
Financial Blogs
Blogs are a great place to start. Financial blogs, like this one, walk you through financial questions step-by-step. Blogs can dig into financial issues, market factors, and investment theories. However, blogs are only as good as the author. Make sure the blogs you chose are reputable and responsible. And never accept financial advice blindly. Each person’s situation is different, and no advice or information works for everyone in the same way.
Track Your Spending with Financial Apps
The free Mint app from Intuit Inc. is a great way to track spending. Mint lets you know when bills are due. It sends late-payment reminders, so you avoid late fees. Mint can “learn” your spending habits over time, and even gives you budgeting and bill-paying advice. And it includes a free credit score tool.
Streamline Banking with Online Tools
One of our favorite financial tools is online banking. Many online banking websites and apps allow you to check balances, pay bills electronically, schedule automatic payments, transfer money from one account to another, and even send money directly to an individual instantly with products like Zelle. Online banking makes banking significantly more convenient.
Bookkeeping Gets Easier Online
We also like Quickbooks. Whether it’s for home finances or business use, Quickbooks’ sleek, easy-to-use account program integrates with your bank account(s) and offers a wide variety of bookkeeping tools. It can track expenses and income, track expenses by category, offers the ability to log expenses via an electronic receipt log, estimates quarterly taxes, and includes an app that includes a mileage tracker.
Online Investing Presents Challenges
However, when it comes to online investment tools, things may get more complicated. While there are many online investment tools available, few can help you create multi-faceted financial plans that make the most of your challenges and opportunities.
The biggest challenge with online investment tools is that they’re usually focused on one type of financial activity: investing. While many online tools go deep into one discipline or area, few can customize to meet your needs across financial platforms or to provide plans that meet your highly individualized needs.
Holistic Financial Planning is Critical
That’s why it’s so important for you to take a proactive role in developing your financial goals. When creating or revising your financial plan, you should consider the following:
- What are the tax implications of my financial decisions? Will these financial choices subject me to more taxation? What financial choices could I make to decrease my tax burden?
- How liquid are my assets? If there is an emergency, how quickly could I access my funds? Am I able to withdraw funds or close out accounts quickly?
- How much life insurance should I have? Can I use life insurance as a savings vehicle? Should I purchase term or whole life? What are the tax implications of these kinds of policies and their payouts? What happens if I eliminate a policy? Do I need a different kind of life insurance if I start a business?
- How much risk is associated with my investments? Are my asset allocations appropriate for my age, life-stage, family status, and financial expectations? Should I be more aggressive with my investing choices, or should I look for lower-risk options? Am I considering a wide array of investments that includes stocks, bonds, and commodities?
- How do my life choices affect my financial plan? Have I considered the financial implications my choices have for my family members, dependents, business partners, social conscience, and philanthropic interests? What happens if get married or divorced? What happens if my spouse or partner dies? What happens if I am disabled or must go into long-term care?
- What is the best way to manage sudden wealth? How should I handle income from an inheritance, a settlement, a business sale, or if I won the lottery? Are there ways to minimize subsequent taxation?
- Have there been recent changes in state or federal laws that make my past financial decisions less desirable? If I’ve moved from one state to another, do the changes in tax laws impact any of my financial decisions? Have corporate mergers or dissolutions necessitated a financial review?
- Do I know how to evaluate market fluctuations? If the market dips, crashes, or soars, do I understand how this affects my financial decisions, and do I know how to course correct appropriately?
The online approach requires time and effort on your part. You will need to monitor your choice of financial products closely. Remember to stay level-headed when markets start moving up or down, which can be challenging for do-it-yourself investors. A 2015 Natixis survey reported that more than half of investors had a hard time staying unemotional during market swings. It helps to keep yourself grounded and remember that the stock market averages gains over the years, but fluctuates considerably day to day or month to month.
Why Choose a Financial Planner?
Many financial professionals (including Mirus Financial Partners) work on fees, based on the value of your financial products. We make more only when you make more. Responsible financial planners also help clients plan in ways that provide no income, including recommending cash accounts for emergencies, suggesting the services of reliable tax accounts or attorneys, or suggesting setting up a trust to minimize certain types of taxation.
The financial planner’s fees come from the value of investments and insurance policies. In fact, that’s also how also most online services work too. Websites that allow you to purchase financial products are usually receiving fees in similar, or even identical ways.
Mirus Financial Partners can also help you figure out whether you are on track with your financial goals, evaluating not only investments but also your 401(k), 403(b), 457 plans or Roth IRA's. We may also be able to help you think through your needs for life insurance, calculate your social security expectation, create a college savings plan, or help you think through estate planning. We can help you create a sound financial approach to management of inheritances, financial windfalls, and large purchases or sales of personal property.
Contact Us
Online tools are a great way to do many things. But if you need a personalized approach to financial planning, and are looking for a licensed professional to optimize your financial situation, contact us today.
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Mark A. Vergenes is President of MIRUS Financial Partners, 110 E. King St., Lancaster, PA; 717-509-4521 or mark@mirusfinancialpartners.com Investment Advisor Representative offering securities and advisory services offered through Cetera Advisor Networks LLC., member FINRA/SIPC. Cetera is under separate ownership from any other named entity. Neither MIRUS Financial Partners nor Cetera Advisor Networks LLC. give tax or legal advice.