Do you think you have the perfect personal finance app? Think again!

Financial apps are essentially designed to help you monitor and track your assets while you stay updated with current events that affect your investment decisions.

By Chirag Nanavati

Financial apps are essentially designed to help you monitor and track your assets while you stay updated with current events that affect your investment decisions. Interestingly, just like a business, the bigger it gets, the better you have to be at managing it. Stress, anxiety and pressure are by-products of growing wealth. Principals need the right combination of people and technology to stay in control. For starters, a holistic view of one’s total net worth is imperative for staying prepared to manage complexities. While most of us use financial apps to fill this gap, most personal financial apps today offer only a subset of features that are required to support comprehensive needs of the savvy investor.

Calculating an individual’s net worth requires arduous consolidation of data on liquid and illiquid assets from scattered spreadsheets and heaps of paperwork. A financial app with a simple interface to collate every bit of information and provide a quick view of the bottom-line across all assets is the need of the hour. Here are five features you should look for while evaluating whether your personal finance app makes the cut.

Valuation Balance Sheet
With financial data scattered across spreadsheets, wealth owners are unaware about their actual asset allocation and portfolio performance. As a result, an individual struggles to access important data at the time of decision making. This is where balance sheets come into play. A simple investment oriented balance sheet puts the power of information back into the hands of the wealth owner. It provides an overview of your net worth at any given point in time across all assets, liabilities and annualized returns.

Cash Flow Statement
A personal cash flow statement keeps a track of your investments, by mapping how much cash is moving in (inflows) and moving out (outflows) of your investments and accounts. It determines your net cash flow and also enables you to look at future cash flows for planning investments. A good personal finance app should efficiently map this and notify you when you exceed the limits of asset allocation, cash inflow and outflow. The next time you think of selling your car, you can quickly track how much you have invested in the vehicle on your app and can accordingly determine the selling price.

Monitor Your Income and Expense
You may be great at creating wealth, but you also must be smart at monitoring and managing expenses. More often than not we find ourselves making frivolous expenses that in hindsight could have been avoided. A good app should allow you to set your monthly budget and monitor your income and expenditure by auto-syncing your bank account and credit cards.

Document Vault
Wealth or no wealth, our lives are inundated with documents and paperwork. You may have a great filing system or may have started using cloud storage platforms like Dropbox or Google Drive. But over time, searching for documents can be nerve wracking due to poor or no file tagging structure in place. Therefore, we need apps that can link all assets and transactions to uploaded documents like contract notes, insurance, property purchases etc. This eliminates the need for labeling every single document and gives you peace of mind

Investment news
Almost every business newspaper and magazine in the world has an app today. Since it is essential to be updated on the latest news related to stock markets, mutual funds, real estate and so on, users download various news apps. Alas, investment news is only provided on these news apps and not on the personal finance apps. It is important to bring together news on all assets and liabilities from an external medium onto your personal finance app, so that you do not have to hunt for relevant news when you need it.

The author is Executive Director at Asset Vantage.

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