Management consultant, lecturer and author Peter Drucker once said, “If you can’t measure it, you can’t improve it.”
This idea has strong resonance in finance and investment. With the rise of digital payment and investment platforms, making and spending money is easier than ever. However, this convenience comes with challenges, especially the risk of overspending, as digital transactions can become disconnected from physical money, often leading to impulsive purchases.
This convenience also extends to investments. Quickly accessible platforms allow us to invest in stocks, cryptocurrencies and even high-risk asset classes with just a few taps. However, the speed of digital investing can lead to ill-considered decisions. Unlike in the past, when investment choices involved more paperwork and thinking time, today’s investing comes with its own risks.
This brings us to an essential principle of financial management: the importance of regularly monitoring and tracking investments and expenses. Fortunately, technology now offers tools that simplify the process of assessing and adjusting our finances, supporting better long-term planning.
Benefits of using a single investment platform
A disciplined investment approach can be very rewarding, especially when managed through a single, consolidated platform. Such a platform allows you to view all your investments and expenses in one place, streamlining the process and making it easier to stay on top of your financial health. Here are some key benefits:
1. Time saving
In our fast-paced world, financial management often takes a back seat. One platform that combines all investment and spending data saves time, reducing the chance that these important activities will be postponed. With one consolidated view, you can quickly check your finances without having to log into multiple accounts, so you can stay organized and proactive.
2. Data consistency
Multiple platforms often lead to discrepancies in your financial data. Managing investments and expenses through one platform ensures that all information is consistent and synchronized. This reduces the risk of decisions being made based on incomplete or incorrect data, which could otherwise lead to costly errors.
3. A clear overview
A ‘helicopter view’ of your financial situation is invaluable. Having all your investments and expenses in one place allows you to make more agile and informed decisions. A consolidated view helps you assess overall financial health and make adjustments more quickly, whether it’s rebalancing your portfolio or rebalancing your financial situation. adjusting your monthly spending goals.
4. Improved cost registration
One categorized view of your expenses can reveal unknown or unnecessary costs. For example, you may encounter various charges from banks, credit cards or lenders that add up over time. If you are aware of these hidden costs, you can take steps to minimize them, such as negotiating with providers or avoiding certain fees altogether. Additionally, by categorizing expenses, you can track which parts of your budget are being overspent, so you can stay within limits and avoid wasteful spending.
5. Identifying underperforming investments
With all your investments visible on one platform, you can more easily spot the ones that aren’t meeting expectations. By regularly reviewing this consolidated overview, you can take timely action on underperforming investments, especially if they are affected by structural problems. This setup also makes it easier to ask specific questions to financial advisors, allowing for more informed decisions.
6. Succession planning
In India alone, over ₹2 trillion remains unclaimed in banks, investments and insurance policies. This often happens because family members are unaware of these assets. Keeping all investments in one place can simplify things for loved ones, making it easier for them to access important information when needed. Good succession planning includes documenting investments and sharing details with family members to avoid unclaimed assets and help them understand your investment philosophy. In times of need, your family will be better prepared to manage these assets.
Technology and financial discipline
Effective financial management is not just about choosing the right investments; it’s about promoting disciplined habits. As Warren Buffett notes, our behavior on small decisions determines our responses to larger decisions. A consolidated investment platform promotes financial discipline by offering a structured approach to monitoring and managing assets.
There are a few important points to consider when choosing such a platform:
- Data privacy: Individuals must ensure that the platforms attach sufficient importance to data security and privacy.
- Cross selling: When these platforms get access to all your data, they can misuse it to sell you products such as insurance, etc., that are not necessarily in your interest. You must ensure that this does not happen.
- Interface: The platform must be technically advanced, able to integrate all data points and have a simple interface.
Investing in a unified financial platform is more than a convenience; it is a foundation for building lasting financial success. As we embrace digital finance, a consolidated approach can support financial clarity, discipline and control.
Opinions are personal. Vivek Bank is co-founder of GoalTeller.
