This Is How Fintech May Help Make Everyone Richer

This Is How Fintech May Help Make Everyone Richer

The rise of the fintech industry isn’t merely worth paying attention to if you’re an investor or entrepreneur. It’s also worthy of consumer attention. Of course, as new products and services reach the market, users will discover them, determining which succeed and which fail.

However, unlike new apps and websites in many other industries, fintech solutions offer consumers the opportunity to improve their own financial situations. The following are just a few key ways fintech services can help users achieve this goal:

Budgeting

After its debut, Mint.com quickly earned praise from users for making it easy to manage one’s personal finances. Mint.com has been extremely successful, and although there are many other budgeting tools available, none have become as mainstream. Perhaps this is because entrepreneurs in this field tend to either look for unfilled niches, or seek to improve upon existing concepts.

The money users save by keeping track of their expenses with this tool could inspire them to seek out additional fintech services they can use for similar purposes, helping to grow the industry as a whole.

Reducing Bills

budget

Did you know the average American driver overpays by about $350 for car insurance every year? It’s difficult to manage your independent personal insurance policies, shopping them on an annual basis to see if you’re paying too much.

That’s the kind of problem many budding “insurtech” firms are looking to solve for their users. With a tool that allows you to manage your insurance policies via a single platform, you could more easily check to see where you’re being overcharged.

Startups could apply this same principle to essentially any financial service for which users could potentially be overpaying. Anyone looking to reduce their monthly and annual expenses may want to pay attention to how this aspect of the fintech industry develops.

Cutting Daily Costs

When you head to your local store to pick up groceries, clothing, or any other items you may need, you’re spending money on gas for your vehicle (or a train ticket, or a bus ticket, etc.). Over time, those expenses add up, so many turn to online shopping is the way to reduce these costs.

Obviously, online shopping is nothing new. However, fintech entrepreneurs are constantly working to develop new tools that make conducting online, “virtual” transactions easier and less expensive. Shopping for necessities may seem like a minor component of one’s overall spending. However, users may save substantial sums of money in the future by embracing any and all services that help them cut costs in their daily lives.

Along with transaction software, features that make it easy to find lower prices on items are becoming increasingly more common in fintech and online retail apps. These, too, make it much easier for users to reduce their day-to-day spending in ways that may not seem significant until the total savings are calculated.

Investing

Early online investing tools opened the door for reluctant users who wanted to buy and sell stocks, but felt intimidated by the process. Apps like Robinhood remove barriers by not only providing customers with an easy-to-use, smartphone-friendly tool, but also by eliminating the prohibitive broker fees that deter many potential investors.

Those tools help ease newcomers into the world of buying and selling stocks. With some luck, knowledge, and diligence, it’s entirely possible that many of them will go on to make substantial sums of money via their investments.

Experienced investors will also soon have new tools at their disposal. For example, a fintech startup led by three Northeastern University students is developing a new service for Thomson Reuters that aims to help analysts better predict the potential success of an investment model by comparing it to financial data from the past. In these early stages, it’s not possible to determine how effective or popular such an app would be. However, if it works as planned, it could have a dramatic impact on how financial service professionals conduct business.

All of this is just the tip of the iceberg. Theoretically, fintech services will make saving for retirement less confusing, filing taxes less time-consuming, and paying monthly bills even easier than it already is. Again, it’s already an industry worth focusing on if you’re an investor or entrepreneur looking for your next big opportunity.

You don’t need to be involved in a startup to benefit financially, though. As these services become more widespread, consumers will continue using them to save money, and maybe even make money. As always, it will be exciting to find out what happens next.

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