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In generations past, kids needed to understand how to balance a checkbook and iron out a budget. But thanks to modern technology, checkbooks have been replaced by online banking, apps have replaced paper budgets — and the changes don’t stop there. At nearly every turn, other new competencies and gadgets have superseded old-school “hard skills” in personal finance, ushering in a more modern, tech-based conventional wisdom.
Online banking: the new checkbook
Learning how to balance a paper checkbook used to be a non-negotiable component of personal finance classes in schools. And while reconciling the books is still an essential skill to keep your finances in the black, the mechanism looks a little different.
For instance, many modern bank users rely on their bank’s website to view recent transactions and past statements. Thanks to an increasingly digital world, you can view when transactions post in near-real time, simplifying the process of tracking purchases and determining balances. No manual calculations are necessary.
But first, users need a solid computer and internet skills and should be incredibly familiar with their bank’s online interface. For those with multiple accounts, aggregators offer an overview of all accounts, providing a complete picture of financial health but adding yet another learning curve. And still, even with the perks of automation, all hard skills shouldn’t be abandoned. Since check or wire transfer transactions don’t post immediately, account holders still need a general awareness of how much money is going in and out to avoid overdrawing.
Related: How Digital Wallets and Mobile Payments Are Evolving and What It Means for You
The convenience – and savings – of moving money online
In the past, frequent trips to the bank were common to deposit checks, transfer funds and manage other affairs. But modern online savings accounts have replaced these outings and often provide better benefits and flexibility.
Using an internet-enabled device, savers can manage accounts from anywhere and move or deposit money with just a few clicks. Many online options are high-yield accounts, meaning users can earn more interest on their savings.
However, while online savings accounts offer slick, user-friendly features, adding yet another website to your daily mix comes with a short learning curve. And though this money is liquid, timeframes can vary when transferring money between accounts. So, banking customers should study their account terms to ensure their cash is available when they need it.
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