A survey released today by Javelin Strategy & Research, which serves financial institutions, found in August that nearly one in five Americans doesn't monitor or manage their personal finances. That rate is double what it was just a year ago. Despite the fact the recession has made it more important than ever to carefully track our money, when it comes to personal finances, 19% of Americans stuck their head in the sand. A year before, another survey had the figure at just 8%.
More anxiety-induced news: The percentage of Americans who say they sometimes log onto their checking account balances with their banks' websites dropped to 46%, down 13 points from 59% a year ago. Even those who track their money by pen and paper dropped, from 50% to 46%.
"It's a natural human reaction to stress: 'Maybe if I don't look at it, it will go away.'" explains the study's co-author, senior analyst Mark Schwanhausser. "I think you have fewer people checking their finances online because they don't like what they're seeing. 'I'm going to be a financial sleepwalker. I'm not going to look.'"
Schwanhausser's prescription for the problem involves convincing America's major financial institutions that they're doing a lousy job helping make it easier and less stressful for their customers to track their money. "It's not enough to tell you how to fix the toilet," he says. "You've got to have the wrench."
Yet despite the fact that most Americans' money resides at a bank, few banks are interested in furnishing financial planning tools. Right now, Schwanhausser argues, most people are required to log into a wide variety of websites to track their money. For example, 75% of Americans who have a credit card get it from somewhere other than their primary bank, meaning their finances are scattered across many websites, unreconciled.
When people do turn to their bank's websites, he argues, the financial planning tools are nearly non-existent despite the fact our society increasingly demands greater personal control through technology. "Today's online banking is like having avocado green appliances from the 1970s. It just doesn't cut it," says Schwanhausser.
Schwanhausser is using the survey to convince banks that it will actually endear customers to them if they put personal finance tools front and center on their sites, helping customers paint a clear picture of their own financial habits. He's pressing them to develop systems, both on the Web and through mobile apps, that can draw in customers' information from other sites, such as credit cards and mortgage lenders, so financial care-taking can be a one-stop process.
So far, banks and lenders have been slow to use existing technology to make money management a less daunting chore. Part of the issue is that many banks don't want to acknowledge competitors by drawing in account balances from elsewhere. Banks also stand to make money off poor financial planning through penalties and fees. Like a doctor who makes money off treating disease, promoting financial good health does not on the surface appear to be in a bank's best interest.
"You can't manage what you don't measure," says Schwanhausser. "And if the bank's not going to provide it for you, you have to go get it in other places."
He recommends existing aggregators such as Mint.com, which pulls your data from multiple sources and lays it out in spreadsheets and in spending plans, as a model for what all the banks should be doing for their customers.
He also notes that Bank of America's "My Portfolio" and Wells Fargo's "My Savings Plan" are two fledgling, if little-known, bank-created features that are slowly reaching toward the sort of comprehensive personal finance planning features he advocates.
As long as it remains difficult or scary, though, when it comes to their finances, Americans will remain more likely to use the Ostrich Method.
Are you an entrepreneur, solo business owner or freelancer? Are you keen to get regular business advice but don’t have the time to work out which blogs to subscribe to? Well, we’ve done the research for you.
Here’s a collection of business blogs aimed at entrepreneurs and small businesses. These have been chosen for their insights, advice, presentation and overall appeal to business people. Hopefully you’ll find these blogs cover all the business management advice and business trends analysis for your needs.
1. Harvard Business Review
Harvard Business Review is a staple in any entrepreneur blog collection. The blog delivers timely business analysis and professional management advice.
2. Young Entrepreneur
When you’re just starting our with your business venture, things can be a little tough. Young Entrepreneur focuses on the things you’ll need to know – financing, bootstrapping, identifying opportunities and making sales.
3. 64 Notes
64 Notes gets straight to the nuggets of gold by bypassing straightforward management tips and filling each post with those eye-opening things that change your business from alright to amazing. They also write a lot about how to avoid being the start-up that failed.
4. The Personal MBA
The Personal MBA is a blog dedicated to teaching all the tips and tricks you would have learned if you had done a degree in business. It recommends books, summarises books and draws on advice given freely by great minds in business. If you follow this blog you will learn a great deal about managing your business.
5. Instigator Blog
Instigator Blog is a very insightful blog, mainly discussing thoughts relevant to small business and entrepreneurs, written by an entrepreneur as he works on his business.
6. Fast Company
Fast Company is a major business blog, covering business news and trends. It’s vital information if you want to know where business is heading.
7. Entrepreneur Blog
Entrepreneur Blog is a site dedicated to providing business insights to entrepreneurs. It will analyse business failures, successes and trends, while offering sensible advice for any business owner.
8. The Entrepreneurial Mind
The Entrepreneurial Mind is a business blog written by a Belmont University professor of Entrepreneurship. His academic insight into the world of the entrepreneur is a great balance to the news and trends offered by other blogs.
9. Creative Web Biz
Creative Web Biz is a great blog for all the artistic entrepreneurs out there. This is a place for those people who are entrepreneurs, but don’t much care for all the business management advice and trends. This blog is entirely focused on how to get that art out there and sold. Highly recommended for musicians, artists, and makers of other crafts.
10. Work Happy
Work Happy is a blog offering advice for anyone in business for themselves. It’s useful for freelancers, small business owners and entrepreneurs alike. It features a lot of video presentations from entrepreneurs to keep things interesting.
Bonus: Entrepreneurship Interviews
Entrepreneurship Interviews added itself on to the list by being a wealth of information in the form of interviews with entrepreneurs. It’s not much to look at, but there is a lot to be gained by listening to what other entrepreneurs say candidly about their own business ventures.
More Blogs
If you’re keen to see some more great blog lists from MakeUseOf, read on:
- Four Best Inspiring Blogs Every Life Hacker Should Subscribe To
- 3 Personal Finance Blogs That Will Get You Out Of Debt
- The 10 Most Stunning Photo Blogs
- 6 Best Web Design Blogs To Follow
- The 6 Best Blogs For Architectural & Interior Design Ideas
If you know of other great blogs for business people, let us know in the comments!
Image Credit: Shutterstock
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