How to build a financial strategy

There are many fateful decisions we take in our life, and money is one of them. In fact, what we do with our money is the single biggest decision that we can take in life. This is because money can help us achieve our goals and save us from any surprises that might come our way — we’ve all experienced that a little too much in 2020.

This is why building a financial strategy, saving money, and then investing it in profitable ventures is a crucial step in gaining financial independence. In fact, saving alone can be considered an investment, since banks offer interest rates in exchange for deposit accounts.

And banks offer a small monthly or annual percentage over the amount deposited as a form of reward for the customer. Pretty cool huh? And we’ve just scratched the surface.

Let’s give you some ideas on how we can help you build a financial strategy:

Spending Goals

There are endless possibilities to make money with modest capital — as long as you build the right financial strategy and choose the right bank. Indeed, choosing the right bank can be the single most important factor in building wealth and managing your money well.

Choosing the right bank means ultimately having the right saving goals- think of emergency funds, medical insurance, car insurance, retirement funds and more. It also means having the right spending goals. After all, we all operate on a budget, and we need to keep our appetite for shopping in check, especially when we are surrounded by temptation.

That doesn’t mean we can’t indulge ourselves every now and then with a treat, and here comes the role of Spending Analysis and Spending Tags. These features allow you to control your day-to-day to monthly expenses.

With Spending Analysis, you will get detailed insights into your spending habits so you can keep track of how much money goes out of your bank account. Far too many times, you’ve probably been caught far too late in spending money more than you should each month, so this feature will help save your money and save you financially each month.

Next comes the Spending Tags feature- every day your app will calculate the money you spend and group them into categories for you. What makes this feature super convenient and helpful is that you can customise your spending tags, so whatever you spend will get grouped into the right category. This way, you’ll know how much you’ve spent on your daily coffee, to transportation, and spontaneous shopping sprees.

Now you can prioritise your spending lists by singling out the important items that you need to buy and keep track of your spending history by saving the items you buy.

But saving isn’t just about hoarding money away and tracking your expenses. There are many features when it comes to having a good, healthy saving process. Let’s explore more options.

Standing Order

Now, on to the next financial step. This is for customers who own more than one account, whether it is a personal or business account. In this case, your mobile app allows you to save by giving you the option to automate a monthly transfer from one account to another.

It’s the same idea when you stack away a certain amount from your monthly salary, only this time it’s on a larger scale and saves you both time and money in the long-run. The great thing about a Standing Order is that it’s automatic, so you won’t need to remind yourself to transfer anything into your savings account every month. The app does the work for you.

Round up and save

It’s always the little things that matter. If you’re paying by card for an amount that is estimated in decimals, your mobile app will round up the decimal number to the nearest complete integer and add the remaining amount, no matter how small it may be, to your savings.

For example: if you’re paying by card for something that costs 3.50 JOD, the app rounds up the amount to 4.00 JOD and takes 0.50 JOD, and adds it to your saving account. That way, by the end of the month, you will have probably saved a few JODs. Pretty cool, no?

Investing

OK, enough with the savings part. Let’s talk about investment. How much do you know about investing? After all, investing can take different forms and sizes. For example, investing in your education (by taking out a student loan) is one thing, and investing in real estate is another thing entirely. Not only are the amounts of the two investments very different, but so is the nature of their remittances and pay-offs.

Term Deposit

Are you a newbie investor who wants to take the first step towards financial security? A Term Deposit allows you to enjoy financial security through investing your money for a short-term goal or for a rainy day. Your starting balance is only 5,000 JOD, and, because the nature of your commitment is a short-term one, you can choose between a monthly, quarterly or annually paid interest.

Certificate of deposit

Not ready to invest in stocks and bonds? No need to worry. Keep your mind at ease and build your savings through a certificate of deposit, with higher returns to save for whatever the future holds for you. Benefits include flexibility to pick the currency of your deposit and renewal of deposit upon maturity.

Certificate of Deposit vs. Term Deposit:

A certificate of deposit is an investment tied down with pre-set maturity dates that are usually long term and cannot be withdrawn before the maturity date. A term deposit is a short term investment with lower interest rates than a certificate of deposit but with the flexibility of accessing your money should you need it.

Building an effective financial strategy is a step by step process to gaining future financial freedom. What’s more, staying committed and disciplined to achieving your financial goals will pay off in the long term. You don’t have to start with all the options we’ve given you in one go; you don’t have to put all your eggs in one basket.

You can simply start slow and the more money you grow, the more you could put towards your short and term and long term goals- be it saving for your next holiday, saving for a mobile phone, or saving to buy a home.

The earlier you begin your financial strategy, the more addictive it’ll become. And that’s because it works!

Take control of your finances and shape your future. Open your digital account today and create your very own customised financial strategy. Find out more here.