Today’s guest post on digital wallets is sponsored by CO-OP Financial Services.
Here are the basics on a digital wallet and how you can take advantage of its awesome features to help you stay on top of your finances.
What is it?
A digital or virtual wallet is essentially an app that enables you to make electronic commerce payments from your smartphone. With a digital wallet, you can store the info from all your credit cards into one convenient place. Types of digital wallets include Apple Pay, PayPal and Sprig. With a couple swipes on your phone, you can make purchases and payments easily and quickly, no matter your location. Here are some of the benefits of using this type of payment:
It’s very convenient and easy to transfer money to your friends and family, which is huge perk!
Because digital wallets employ tokenization, which is a technological process that substitutes non-sensitive info for sensitive, personal info, they can provide greater security. Also, it slims your wallet so that you don’t have to worry about losing or leaving credit cards when making purchases. Instead, you can carry your smartphone or you can opt for a one credit card digital wallet option that allows you to make purchases with any of your accounts from the same card.
As your personal information isn’t shared with merchants, there can be more privacy with your transaction history and info.
How can you use a digital wallet to help you budget?
One thing you can do is to create a system to keep track of your spending. With a digital wallet, there’s no more recording transactions by hand, saving receipts, or manually entering your expenses and income into computer programs! For instance, a digital wallet automatically helps you keep track of where your money is going and how frequently. A key benefit of using a digital wallet for budgeting is accessibility to past and current purchase transactions to make adjustments to future spending.
Here are some ways to create your own system:
- Set alerts to limit spending.
- Store loyalty cards and member rewards info to help you save money. Also, certain apps use the digital wallet user’s location capabilities to allow them to receive digital coupons based on where they’re shopping.
- Monitor your spending by checking how often you spend at certain stores, and in what categories (i.e., groceries, clothes, entertainment). If you find yourself overdoing it at your favorite stores, you can make tweaks as necessary.
While digital wallets are not an entirely new technology, understanding their full capabilities will help you get the most out of their rich features and stick to your budget. To learn more about digital wallets that are available to you, contact your local credit union.