January is Financial Wellness Month, which encourages people to examine their finances and where their money is going.
Furthermore, the growing prevalence of digital wallets and platforms can transform transaction-by-transaction data to assist younger customers in better understanding their spending and automating the activities required to achieve their financial objectives.
It’s known as a virtuous cycle. However, technological assistance appears to be desperately needed. According to a new study conducted in cooperation with LendingClub, 57% of paycheck-to-paycheck customers believe that persistently rising inflation has hampered their ability to achieve long-term financial objectives.
Given that 63% of us live paycheck to paycheck, this indicates that a sizable portion of us faces obstacles in achieving our long-term financial goals.
Saving money is an important component. Setting aside some monies from each bi-weekly or monthly income to be transferred to savings or investment accounts can help to 1) pad financial reserves, 2) make returns through various investment products, and/or 3) pay down debt.
Of course, savings have been strained. According to experts, 32% of all consumers reported a decline in the part of their income they can save, while 42% of struggling paycheck-to-paycheck consumers acknowledged such constraints.
Separately, J.P. Morgan said in its own analysis that “excess savings” in the United States total $900 billion, down significantly from $2.1 trillion during the epidemic.
Willingness to Experiment
As they aim to enhance their financial wellbeing, consumers might benefit from a leg up, a little help, in making the leap from desire to reality. Digital wallets, which are among the most popular new payment options for the next year, can serve as a springboard for platforms and suppliers to assist them get there.
According to our research, 59% of customers who tried a new payment method in the last year chose digital wallets, and 42% of U.S. consumers polled are interested in the payment method but have not yet tried it, indicating a greenfield potential.
