College Connect Spring 2019: Students Turn to Mobile Apps for Financial Tools

Posted By David Wilhite on Tuesday April 9, 2019

By Jessica Wurst

Mobile finance applications can offer a simple way for students to track personal finances, but they also can make it too easy to put money into the stock market without proper knowledge.

App such as Mint and Acorns aid students with financial management by tracking spending and account balances. Similar apps providedby banks such as SunTrust and Wells Fargo are also attractive to students due to their simplicity and brand recognition.

“Mint is great if you’re trying to track expenses on multiple accounts, but you don’t need to use it if your bank has a website or an app that works for you,” said Brenda Cude, a professor of financial literacy at the University of Georgia.

Alex Sutton, a senior finance and international business double major at the University of Georgia, agrees. He prefers the Wells Fargo app to more involved tools such as Mint.

“I keep a handwritten checking book along with looking at my statement so I can see what I’m spending,” said Sutton. “I look at it on my phone and then I compare it.”

Although Sutton opts to manage his finances in a simple manner, he uses mobile apps such as Robinhood and E-Trade to track a stock portfolio, an activity he finds more interesting than budgeting.

“You see money go up and you see money go down. It changes all the time so it’s way more fun, especially when you pick a winner and you watch it go up,” said Sutton.

In addition to allowing investors to keep track of their finances, investment apps provide an outlet for novice individuals to quickly enter the trading world.

“Robinhood makes it super easy. When you download it there’s no minimum amount, so you can transfer literally $10 and buy whatever,” said Sutton. “It sends you news updates and you can learn the market by yourself. Platforms like that make it easier for new investors to get into the game.”

As a professor who specializes in financial proficiency among college students, Cude worries about the consequences of unprepared students entering the stock market.

“I don’t know where they got the idea that that’s a starting point for young adults,” said Cude. “That’s not the way most people in this country build wealth, so it does concern me that it’s so much easier to do that than it is to start an emergency fund.”

Cude said that students may be gravitating towards the stock market through apps due to a lack of knowledge about other investment options.

“Maybe they don’t understand that if they have employment options, and options for employer-based investing plans like 401K, those can be invested in stocks,” said Cude.

Even though some students may be putting their money into stocks without understanding how markets work, Cude believes they will be pushed in the right direction through real-world lessons about investing with a long-term plan.

“Probably the best benefit is when they lose all their money. They’ll have a good lesson that this is not what they thought it was,” she said.

Jessica Wurst is a journalism student at the University of Georgia.

 

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