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Dan Calugar on Money in the Palm of Your Hand: the Pros and Cons of Investment Apps


Whether you are new to investing or just looking for a more accessible entry point, there is a lot to like about the new generation of investment apps. Some of these fintech apps are designed to help you save your money, others are designed to help you easily make investments, and some will do both.

They are encouraging a new generation of investors. But these apps have their downsides as well, and it is essential to carefully weigh the pros and cons before hitting the download button.

Here, Dan Calugar, an experienced investor and tech enthusiast, discusses these easy-to-use apps that put stock trades in the palm of your hand.

Under the pros column, some of the benefits of mobile device investment apps include:

Easy to use: The adoption of investment apps has skyrocketed mainly because anyone can quickly become an investor using their mobile device. In a world where our lives are primarily managed through smartphones, fintech apps meet the newest generation of investors’ needs. They are intuitive and easy to learn — especially for the digital era.

Instant access to financial news and market information: Financial markets move quickly. Opportunities can come and go within minutes. These new apps give investors everything they need to take advantage of opportunities as they present themselves.

Anyone can make investments: These apps make investing more accessible for large numbers of people. With some apps, a few dollars are needed to get started. For a generation of new investors that grew up with a mobile device in their hand, these investment apps are the most intuitive and natural way to manage their investments and savings.

Ideal for learning about investing: Even if you decide not to use one of these apps to increase your savings or make investments, they provide easy access to helpful news and information to guide your financial strategies.

Low commissions: The financial companies and institutions that develop and provide these investment apps often offer a discounted commission for investments made using their app.

On the “things to watch out for” side of the decision ledger, there is also information that investors should be aware of before using mobile device investment apps, including:

A simplified view of your financial situation: Just like the small screen you use to access your investments with these apps, they fail to provide a big picture perspective of your overall financial position and strategy. Often they do not consider your debt, tax situation, retirement plan, or other investments you may have made elsewhere. Investing requires that you consider the big picture before making significant changes.

Investing using a credit card: Financial experts agree that investing by using a credit card is, in most cases, a bad idea. Mobile apps are designed to pay using a credit card quickly. Investors should be careful not to negate any investment benefit by paying interest on the funds used to leverage the investment opportunity.

Monthly service charge: Many financial organizations that provide mobile device investment apps charge a monthly service fee to access their services. These fees are generally considered insignificant for active investors but beware of these fees if you rarely make investments or use these services.

About Daniel Calugar

Daniel Calugar is an experienced investor with a background in business, law, and computer science. As a tech enthusiast, he became interested in computer science early on and briefly pursued it before obtaining business and law degrees. Dan Calugar developed a passion for finance while working as a pension lawyer. He leveraged his technical skills to build computer programs that would analyze vast amounts of data and explore trading strategies to identify more worthwhile investments, allowing him to succeed as an investor. When he is not working, Dan commits much of his time to travel with his life partner and family or supporting the Angel Flight Organization.

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