Let technology help you accumulate money

Financial Apps and Websites to Increase Your Wealth

by Mike Vichich

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Everyone would love to pass money on to their children and have a fun, enjoyable retirement. That's why commercials exist in which people carry big orange numbers, symbolizing the required size of their nest egg before they can retire.

Ironically, we live in an age where the financial tools at our disposal have never been more powerful. But, there's so much noise around financial apps and websites that it becomes nearly impossible to separate the wheat from the chaff. That's what we endeavor to accomplish with this post.

Before we get into great financial apps and websites, let's begin with one simple guiding principle for accruing wealth: Spend less than you earn over a long period of time, and make that surplus work for you, even while you sleep. Again, spend less than you earn, and put your savings to good use.

The first piece (spending less than you earn over a long period of time) is the hardest. It takes discipline and dedication. Most people break down because they think they need to become fiscally disciplined overnight. So, they put their best foot forward for three weeks and then relapse. Sure, Clark Kent could step into a phone booth and instantaneously become a different person. But for real humans, there is another way. "Climbing steep hills requires a slow pace at first," said Shakespeare.

Wisely, a company that I founded, allows you to create a realistic budget in less than 60 seconds, because it's based entirely upon what you typically spend. If you think you're spending too much per day or week on restaurants, then you can simply dial it down a bit. Plus, Wisely is the first budget that goes with you. When you're at a restaurant or retailer, you can open Wisely and find out how much money remains in your budget for that category. Now you can know whether you can afford that extra cocktail at dinner, or sweater at the store.

So, let's assume that you're now on the path to fiscal discipline. Let's say that you're saving $50/month (if you're able to save more, the point remains the same). If you don't have a 401k program for work, setting one up should be your first move. As a startup, we don't have a 401k plan just yet (hopefully soon!). Consequently, I use Betterment. Every month, I designate a small amount of money to going toward retirement. Within minutes, you tell Betterment your goals, and it'll project your return over time. Betterment's pricing is simple and transparent.

Now, let's assume that you have a bit of money to play with outside of your 401k. If that's the case, I'd recommend checking out Lending Club. Aside from generating strong returns, Lending Club will leave you feeling better about the world. The site allows people who are paying high interest loans to "trade down" to lower interest rates. Essentially, if I owed a bank 30% on my credit card debt, student loan debt, wedding debt, etc., I could come to Lending Club, and they'd match me up with people who would be willing to accept a lower interest rate, say 20%. For me, the borrower, it makes sense because I'm paying a significantly lower rate. For you, the lender, it makes sense because you're unlikely to receive 20% interest rate elsewhere. As the lender, you can see information on the person before you lend money to them, and most importantly, you don't front cash for a person's entire loan, just chunks of it. For example, Lending Club will break up a $10k loan into a bunch of $50 or $100 increments, so the risk is diversified. As a warning, before signing up, do your homework and read other opinions on lending club. Mint.com has a helpful blog post about the subject, for example.

Now, for those of you who are extremely financially well off, you should know about another cool investment vehicle that has recently come into existence. It's AngelList, not to be confused with Angie's List. For now, AngelList is for accredited investors only, which is defined as someone making over $200k for the last three years or who has over $1M in liquid assets, not including their home. If you're an accredited investor, you can invest money in technology startups. Now, keep in mind that tech startups are inherently among the riskiest of investments, but one hit can generate a 100x return on capital. Also, check out AngelList syndicates, which allow wealthy individuals to invest capital with people who know the tech startup scene well, many of whom are successful entrepreneurs themselves.

Lastly, for those of you thinking that AngelList should be available to everyone, you can contact your representatives, and tell them to support equity crowdfunding legislation.

While there's no substitute for discipline and determination when trying to grow your wealth, I hope you're able to use some of these tools to your financial benefit. At Wisely, we're passionate about extending financial opportunity to everyone. If you have questions or comments, please feel free to contact us at hello@wise.ly.

Mike Vichich is the CEO and Cofounder of Wisely, a mobile app that analyzes consumer purchase behavior to find popular, quality places that meet users' price range. Visit the company's website to learn more about how to Shop Wisely.

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