Personal Finances On The iPhone – Pro’s & Con’s

With news (and speculation, really) that the iPhone 5 in 2011 might be linked to NFC technology - technology that allows your iPhone to act like a credit and debit card - there are some interesting questions to ask ourselves.

Sure, initially the news sounds anything but bad - after all, isn’t more financial freedom the goal of any technology that wants to make our lives more convenient?

Of course simplicity is the goal. But as you dig deeper into the issue of using an iPhone to handle our personal finances, you find out that there are some problems you might not have initially anticipated.

This sounds like a perfect topic for a good old-fashioned list of pros and cons.

So let’s take a look at each and allow you to draw your own conclusions for the possibilities of financial independence - or dependence, if you’re cynical - by listing the issues one by one.

Pros

The upside to handling your finances from your iPhone is obvious: convenience and simplicity. Okay, that’s really two upsides, but you get the point. Here are the undeniable positive aspects to using financial technology on your iPhone

Consolidation/simplicity. Have all of your financial accounts linked in an App or two on one gadget? Use that same gadget to withdraw money from an ATM or pay for your gas station impulse purchase? Sounds like a step forward to me. Sure, it might mean that you’ll have to exercise a little more discipline with your spending habits, but if that’s the only drawback, it’s still a no-brainer.
Access to information. The upside to the connectivity and simplicity of the iPhone and how it already has access to stock and commodity prices is very clear at this point. All you have to do is hit an app button or two and you know how your 401(k) is performing and trending, or how much money you have saved aside for that Christmas purchase you wanted to make. The fact that you can do all of this on a touchscreen just reeks of science fiction-level awesomeness.

Of course, there are some clear downsides to awesome technology. Whether or not they cancel out these positives will be up to you:

Cons

What could possibly be a downside to advancement in technology? Well, unless you’ve been living in a bubble, you realize that new technology means a lot of new things in the world - and not all of them are good. Let’s consider the potential consequences to your portable iPhone bank.

Itchy fingers. Not literally itchy fingers, mind you, but simply the fact that with all of this information at your fingertips, it’s handy to check your information all the time. Too handy, in fact. Your 401(k), for example, or your independent retirement account is meant to be something that builds in value over time, using the power of exponential returns over several decades. Checking it every day is not advantageous to you in any way, really, unless you want to stress out about something else in your life.
Bad spending habits. We mentioned it before and it bears mentioning again: having purchases made with a quick swipe of the iPhone can be a major boost...to credit card companies. Sure, things are already easy enough with credit card purchases, but look at what that’s created: how many of your friends have plenty of credit card debt racked up? Imagine if those same people could make purchases just as easily as they check for text messages. Not an excellent combination.

Depending on the person you are, you might think that the risks outweigh the bad. But you might also think that these risks represent a challenge for you to grow alonjg with your technology. Even if everything is more convenient, that doesn’t mean you have to become a slave to the same gadgets that are supposed to be serving you. Use your iPhone with a little responsibility and you should be just fine.