If you’re someone that loves saving money, look no further.

The future of finance is one that involves a lot of investing and saving money whenever possible. While many people strive to do that today, they often don’t know what some of the latest trends are.

Finance industry trends are great to follow because they’re effective and typically revolve around the best investing methods at the time. By following the trends, you’ll be able to maximize your profits and build a strong financial portfolio.

Keep on reading to learn more about the latest finance trends in 2020.

Cashless Transactions

As technology continues to evolve, app developers are coming up with new ways to make everyday processes simpler. One of the most popular trends today is the cashless transaction.

Instead of using physical cash, cashless transactions allows people to purchase things in-store with the use of credit/debit cards and mobile apps. While both credit and debit cards have been popular for several decades now, the use of mobile apps to purchase things is fairly new.

When you get an app like Apple Pay, you can use your phone at the cash register to finalize a transaction. Instead of inserting your card into the terminal, you put your phone up to the scanner. If you have multiple cards, you can choose which one you’d like to pay with.

Cashless transactions are one of the consumer trends that most people are doing, even if they’re not investing their money. In ways, this can encourage people to spend more money because they don’t have to carry cash with them.

Index and Mutual Funds

When it comes to investing, index and mutual funds are two things that many people are starting to invest in, even those that are new to investing. While most people think of the stock market as a place to buy and share individual shares, there are a plethora of options to invest in.

Index and mutual funds allow people to conveniently purchase shares of a variety of companies instead of one. They’re a great source of passive income as the funds are composed of several stocks that have statistically shown to increase over time.

When you purchase one of these funds, you usually have to invest a minimum amount. For example, many funds will require you to put in $3,000.

The difference between index and mutual funds is that an index fund is made up of stocks that perform the best. Mutual funds are essentially like hiring someone to buy and sell stocks for you. With a mutual fund, they try to guarantee you a certain return rate, which can be anywhere between 7-12%.

You can start investing in these funds at most brokerages, but you can also go to sites like Alternative Asset Allocation.

Day Trading

Day trading is another form of investing that takes place in the stock market. It has become one of the popular finance trends because people have realized there’s a lot of room to earn profits.

Day trading consists of buying and selling stocks over short periods, usually within minutes. The goal is to buy large quantities of a stock and sell it after the value slightly increases. A slight increase in value will earn you a lot of money if you have a plethora of shares.

The problem with day trading is that it’s a high risk, high reward investment strategy. Within seconds, you can gain or lose thousands of dollars. You’re also required to have a minimum balance of $25,000 in your trading account.

Should you decide to start day trading, start by using a small amount of money. If your brokerage offers paper accounts (fake accounts to practice), make the most out of them and see if you can earn profits on there.

Roth IRA Accounts

In the finance industry, most people tend not to talk about Roth IRA accounts. A Roth IRA can be one of the best things to put your money in, especially if you’re young.

A Roth IRA account is essentially a savings account that allows you to put in up to $6,000 each year. What makes it a great investment is that the deposited money isn’t taxable and the average return rate is between 7-10%.

If you’re someone that’s looking to save money while also being able to withdraw it at any time, a Roth IRA isn’t for you. With an account, you can’t withdraw the money until you’re 59 and a half. Should you decide to withdraw the money earlier than that, you may have to pay a fee and that money will be taxed.

You should start investing in one if you don’t already have an account. Even if you’re older, you can earn a lot from the return rate.

If you were to invest $5,500 for 30 years from the age of 30, you’d have nearly $600k in your Roth IRA at a return rate of 7%.

The Future of Finance Is Now

You don’t have to wait to start following the latest money trends. The finance industry is constantly evolving, so you should start following today’s trends to stay up to date with what’s best for your money. The future of finance is all about making smart investments, saving money, and making transactions convenient.

We encourage you to start looking into index and mutual funds when you’d like to start investing. Getting a Roth IRA account would also be a good idea because you’ll save a lot on taxes. You should also skip the ATM fees and start doing cashless transactions to save as much as possible.

Browse our articles if you’d like to learn more about finances.