Before purchasing life insurance as an investment, a potential investor should understand a few things about the types of life insurance and how they work. Basic life insurance can be broken down into two major categories, term insurance and whole life insurance.
Term insurance is insurance for which one makes annual premium payments in exchange for a death benefit. This is the least expensive type of life insurance and cannot be purchased as an investment. The death benefit is all that one receives from term life insurance, provided one passes away while the policy is active.
This type of insurance is ideal if you do not believe you will need life insurance in your later years; the older one becomes, the higher the premiums for term life insurance. The primary purpose of term life insurance is to protect those people who depend on you; as one gets older, most people accumulate retirement savings and/or their children become self sufficient, decreasing the need for term life insurance.
Whole life insurance, also known as permanent or cash value life insurance is the second type of life insurance and can be broken down into whole life, universal life, variable life, and variable universal. In general, cash value life insurance offers protection throughout one's entire life, and also includes an investment — the cash value. Only a portion of the premium payments on a cash value life insurance policy cover the actual insurance. With the other portion of the premium, the insurance company sets up an investment known as an accumulation account which is invested in interest-bearing securities.
The cash value reduces the amount at risk to the insurance company and thus, the insurance expense over time. The owner can access the money in the cash value through policy loans or other options which reduce the death benefit. Accordingly, premiums for such policies generally tend to be higher than those associated with term life insurance, at least in the earlier years.
In the digital age, nobody likes carrying a lot of cash around – I know I don’t, anyway. This can be especially frustrating when you go to keep track of your expenses, who you owe money to, who you lent some to and just where it all goes over the month.
As always, there are a lot of apps out there to help you do various things with your money. There are apps to figure out how to manage your money, oversee expenses, send money to people, keep track of who owes you, and more.
In this article, I’ll show you some of the applications you can take advantage of to do everything I’ve mentioned here, leaving you free to pick and choose the apps that will make your life easier.
How to Manage Your Money
I’m beginning to learn just how difficult managing your expenses can be. For the most part, I use my debit card tied to my checking account to make purchases. I use it at the grocery store, when I go out to lunch with my coworkers and on the weekend when I’m out exploring the city.
At the end of the month, my bank statement looks pretty ridiculous. All of these small transactions make it difficult to sift through. I still know what everything is, but if I wanted to see where I could be saving some money I wouldn’t know the first place to look.
Sounds like you? Even if it doesn’t, you could still reap the benefits of visually being able to manage your money. These apps make the process a lot easier.
Mint
Mint has been on our radar since back in 2007 when Karl wrote about it. Plain and simple, if there is one app I want you to keep in mind it’s this one.
Mint is a free personal finance application that can help you compare your bank accounts, credit cards, CDs, brokerage and 401(k) to the best products out there. It offers a visual representation of your finances and is very easy to set up. Use it to manage your budget, get credit card advice and understand investing.
Here’s a great video showcasing an overview of Mint’s features:
For some helpful tips on how to use Mint, check out Bakari’s article on How To Use Mint To Manage Your Budget & Spendings Online.
Thrive
Thrive (directory app) is also a great application if you’re looking for a simple way to keep track of your spending. With Thrive, you get an overall Financial Health score, which is one number that shows you how financially fit you are. It also shows you scores in other areas and offers you advice on how to make improvements.
Thrive breaks down your spending for you and shows you where you can save. Compare your current budget to last month’s, as well as view a six month average and target budgets to follow.
Texthog
Looking for an even simpler way to track expenses? Texthog (directory app) lets you easily store, organize and access your receipts, expense reports and more via text message, the web, your email, iPhone and even Twitter.
A Texthog free account gives one user the ability to track expenses, view unlimited reports and get budget/bill reminders. Take a photo of your receipts and utilize tags and categories to keep track of everything.
To check out Texthog on your iPhone, you can find the application on iTunes.
Venmo
Speaking of text messages, have you heard of Venmo? Venmo (directory app) is a nice little app that lets you pay and charge friends with your phone. Send and receive secure payments by linking your card to your account. This allows you to settle small loans you give/get by eliminating paper transactions for small amounts of money.
To use Venmo, all you do is create an account. You can then send and receive money to other accounts simply by using text commands in SMS. Accept a “trust” request from your friends and make transactions without having to authorize them by texting a 3 digit code.
This is a pretty solid application that I have been using a lot lately with my friends/coworkers. It’s great for when a bunch of you are out to lunch and not everyone has cash on them. “I’ll just put it on my card and Venmo you all afterwards.”
Owe Me Cash
Owe Me Cash is a nice app I found recently that is also very easy to use. If someone owes you money, you just sign into Owe Me Cash with your Twitter, Facebook, OpenID, or regular account and tell the app about the debt. The app will send automatic reminders to those that owe you money by phone, text and email, so you can get paid!
This app is more fun than serious, but it doubles as an easy way to keep track of who owes you what. Let the app bug your friends to pay you so you don’t have to do it yourself – it’s a win-win.
Conclusion
With these applications, your finances will never look better. Say goodbye to paper money and change.
What do you think of these money-managing applications? Will you be using any of them?
Image Credit: marema
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