Keywords

Introduction

An individual’s financial resources are directly related to their ability to meet current and future needs. Higher levels of financial assets and lower debt have been found to be positively associated with financial satisfaction [1, 2]. Findings from the 2012 National Financial Capability Survey report that the presence of an emergency fund has been found to be positively associated with financial satisfaction [3]. On the other hand, inadequate financial resources can lead to financial strain and financial distress. This financial burden has been associated with decreased treatment adherence, worsened mortality, increased bankruptcy. Financial strain can have a powerful impact on a person’s perception of their overall well-being. At the same time, the growth of personal finance apps and technology-enabled tools have exploded over the past 20 years with the potential for objective, quantitative assessments, and self-management of financial resources. Although financial resources have been shown to have a direct effect on quality of life, few studies have addressed the impact of financial resources and financial burden on quality of life and the role of QoL technology-enabled tools for measuring and managing financial resources and improving quality of life.

Definition of Financial Resources

According to the WHOQOL theoretical model, quality of life encompasses several key domains: Physical Health, Psychological Health, Social Relationships, and Environment. One of the environmental facets of quality of life is financial resources. The facet of financial resources explores a person’s view of how his/her financial resources and the extent to which these resources meet the needs for a healthy and comfortable lifestyle, and what the person can afford or cannot afford which might affect quality of life. This facet includes a sense of satisfaction/dissatisfaction with those things which the person’s income enables them to obtain and the sense of dependence/independence provided by the person’s financial resources (or exchangeable resources), and the feeling of having enough regardless of the respondent’s state of health or whether or not the person is employed. It acknowledges that a person’s perspective on financial resources as “enough,” “meeting my needs,” etc. is likely to vary greatly [4].

Originally, financial well-being was seen as synonymous with material and objective financial resources (e.g., income) and was investigated at the country level, without including individuals’ perceptions. However, once Easterlin [5] recognized the importance of subjective perceptions of financial well-being, it has been mainly studied at the individual level.

Nowadays, scholars agree that financial well-being has both an objective and a subjective side, believing that objective financial well-being consists of individuals’ material financial resources (e.g., income), whereas subjective financial well-being is individuals’ perception and cognitive and emotional evaluation of their own financial condition [6]. This subjective side frequently has been investigated mainly in populations considered critical or atypical from a financial point of view, such as the elderly [7], unwed women [8], and divorced women [9].

Although financial resources have been shown to have a direct effect on quality of life, few studies have addressed the impact of financial resources and financial burden on quality of life and the use of personal, quantitative methods and technologies to assess the financial resources and the financial well-being of individuals.

This chapter reviews the literature about (1) the effects of financial resources and financial burden on treatment outcomes and overall quality of life; (2) the state-of-art tools for measuring financial resources by individuals and financial and health professionals; (3) the evaluation of Web-based interventions for enhancing financial resource management; and (4) the behavioral and technology-related factors for successful adoption of QoL technology-enabled methods and financial resource management tools for improving individual life satisfaction and financial well-being.

Current Research About Financial Resources and Financial Well-Being

Financial Resources and Financial Satisfaction

Researchers over the past 30 years have examined both objective and subjective measures to describe the financial condition of individuals and families. Whereas objective indicators have been used to predict one’s perceptions about their financial condition, such indicators do not measure the depth of one’s feelings about or reaction to their financial condition. Several researchers have examined factors contributing to psychological well-being and found economic distress to be a good predictor of lower levels of well-being [10, 11]. Mills [10] found that a key determinant of psychological well-being was the level of economic distress reported. Rettig and Danes found that people who perceived their income to be inadequate to meet even basic living expenses reported experiencing negative feelings and lower satisfaction with the perceived gap between their standard and their level of living. Such normal, negative reactions to adverse economic condition can reduce individuals’ psychological well-being [12].

An individual’s financial resources are directly related to their ability to meet current and future needs. One theory argues that relative income (both to others and to previous periods) rather than absolute income may be important in explaining variations in life satisfaction, i.e., this includes income relative to others, which impacts an individual’s status in society, and relative to the individual’s income in previous periods, which impacts one’s habits and view of what is the norm [13]. Boyce [14] found that the ranked position of an individual’s income predicts general life satisfaction, whereas absolute income and reference income have no effect. Similarly, the rank of a person’s income or wealth within a social comparison group, rather than income or wealth themselves or their deviations from the mean within a reference group, is more strongly associated with depressive symptoms [15].

Researchers generally agree that subjective well-being (SWB) tends to be higher among people with abundant economic resources as compared to people with limited economic resources [1, 2]. However, recent research has begun to distinguish two aspects of subjective well-being: emotional well-being which refers to the emotional quality of an individual’s everyday experience that make one’s life pleasant or unpleasant, and life evaluation which refers to the thoughts that people have about their life when they think about it. Analyzing results from the Gallup-Heathways Well-being Index and Cantril’s Self Anchoring Scale, Kahneman [16] examined whether money buys happiness separately for these two aspects of well-being. While life evaluation rises steadily with increases in income, emotional well-being also rises but there is no further progress beyond an annual income of USD75,000. High income buys life satisfaction but not happiness; low income is associated both with low life evaluation and low emotional well-being.

Although the literature on the relationship between economic standing and SWB has become substantial, only a limited number of studies, to date, have focused on this relationship in mid-life and old age [1, 2]. In general, the findings of the studies on the wealth-SWB relationship have demonstrated that greater wealth leads to higher SWB. Some studies have also demonstrated that the effect of wealth is stronger than the effect of income. Wealth refers to the stock of assets (e.g., savings, real estate, businesses) less their debt held by a person or household at a single point in time vs. income which refers to money (e.g., wages, rents on property, government assistance) received by a person or household over some period of time [2]. It should be noted, however, that the magnitude of the association between wealth and SWB may depend upon the welfare regime and the degree of social support (including type of pension) provided by the state. Similarly, those with more economic resources are more likely to cope with stressful events when they occur. Most studies on the issue were conducted within a cross-sectional research design, very few studies have addressed the wealth-SWB relationship from a longitudinal perspective taking into account the dynamics of household wealth and life transition events over time [1, 2].

Longitudinal Perspective of Financial Resources and Financial Well-Being

Prior research consistently has found that older adults, despite low incomes, are more financially satisfied than younger adults. This “satisfaction paradox” is typically attributed to elders’ supposed psychological accommodation to poor financial circumstances. However, data from the first wave of the Norwegian NorLAG study shows that material circumstances are more important to the financial satisfaction of the elderly. A considerable part of the higher financial satisfaction with increasing age can thus be explained by greater assets and less debt among the elderly. Nonetheless, assets and debt do not mediate this relationship at lower incomes, because older people with little income have very little accumulated wealth. Older adults with little income and wealth have a much stronger tendency to be financially satisfied than younger, equally poor counterparts. An “aging paradox ” remains in this field [1].

A life-course perspective attempts to place indicators of financial well-being in context, yet it is not widely used in the financial well-being literature. Studies that do use a life-course perspective tend to focus on the ‘U’ shaped gradient of financial satisfaction over time [1], arguing that lower debt and greater asset wealth explain why older people are more financially satisfied despite having lower incomes than younger people. Employment-based income was a stronger determinant of younger people’s financial satisfaction whereas investment income was a stronger determinant for older adults [2].

Financial Burden and Its Effect on Treatment Outcomes and Quality of Life

The financial burden of care, especially for cancer, is slowly becoming more recognized among providers, institutions, and policymakers. The high costs of cancer care, even for patients with health insurance, can lead to poorer outcomes for patients, decrease quality of life, heighten stress, and, in some cases, increase mortality rates [17].

According to Fenn [17], increased financial burden because of cancer care costs is the strongest independent predictor of poor quality of life among cancer survivors over the age of 18. Patients who reported “a lot” of financial problems were approximately four times less likely to report a quality of life that was “good” or higher compared with patients who reported no financial problems. The magnitude of cancer-related financial difficulty was a more significant predictor of quality of life than age, education, race/ethnicity, and family income. These findings highlight the potentially powerful impact of financial strain on a patient’s perception of their overall well-being after a cancer diagnosis.

Financial resources can act as a buffer for subjective well-being after the onset of a disability or disease. Using data from the Health and Retirement Study, Smith [18] found that wealth measured prior to the onset of a disability protected participants’ well-being from some of the negative effects of a new disability. Participants who were above the median in total net worth reported a much smaller decline in well-being after a new disability than did participants who were below the median. There was also some evidence that the buffering effect of wealth faded with time, as below-median participants recovered some of their well-being.

Regarding frailty, financial resources, and subjective well-being in later life, Hubbard [19] found that those with greater financial resources reported better subjective well-being with evidence of a “dose–response” effect. The poorest participants in each frailty category had similar well-being to the most well-off with worse frailty status. Hence, while the association between frailty and poorer subjective well-being is not significantly impacted by higher levels of wealth and income, financial resources may provide a partial buffer against the detrimental psychological effects of frailty.

Standardized Self-Report Based Measurements of Financial Resources and Quality of Life

Two different approaches exist to measure financial resources and financial well-being. One approach utilizes a standardized instrument for self-assessment and is frequently used by physical and mental health professionals.

One standardized instrument, The InCharge Financial Distress/Financial Well-Being Scale (IFDFW) , is an 8-item scale designed to measure a latent construct representing responses to one’s financial state on a continuum ranging from overwhelming financial distress/lowest level of financial well-being to no financial distress/highest level of financial well-being. The robust Cronbach’s alpha of 0.956 for the IFDFW indicates high internal consistency, and factor analysis indicates measurement of one factor, verifying that the indicators together estimate only one latent construct. Thus, the IFDFW Scale provides a high level of confidence for researchers and practitioners using the scores to indicate perceived levels of financial distress/financial well-being in individuals and groups of consumers [20]. This scale has been used to develop and deliver high quality, effective workplace financial programs [21]. However , the scale was developed to measure financial distress and well-being in general and may not include factors relevant to a specific stage of life such as emerging adulthood [20]. The IFDFW is also known as the Personal Financial Well-Being (PFW) scale .

Another standardized instrument, The Multidimensional Subjective Financial Well-being Scale (MSFWB) is a 25-item scale measuring five different aspects of subjective financial well-being (general subjective financial well-being, money management, peer comparison, having money, financial future) with acceptable psychometric properties and was developed for use with emerging adults in European countries namely Italy and Portugal. Validity of its 25 items was assessed through consultation with experts on the construct as well as the emerging adults themselves (qualitative research). Furthermore, the functioning of these items was confirmed by quantitative results showing the stability of the scale’s factorial structure, its generalizability across different emerging adult subgroups, its relationship with convergent and criterion-related measures, and its internal consistency. However, the generalizability of this measure across European countries and use in the US has not been demonstrated [22].

State-of-the-Art Apps and Tools for Measuring Financial Resources and Financial Well-Being

Use of Personal Finance Apps and Financial Resources

The second approach to measure financial resources and financial well-being utilizes Artificial Intelligence (AI) and algorithms and is frequently used by financial advisors and individuals interested in the self-management of their financial resources. This approach can range from budgeting and personal financial apps to more sophisticated and complex software programs used by financial advisors and robo advisors. More recently SigFig and Jemstep offer QoL technology-enabled investment and financial management tools.

Smartphone personal finance apps have grown significantly with the growth of smartphone users. According to a recent (February 2018) Bankrate.com Report [23] about the use of finance-related apps, including those from traditional banks and fintech players, 63% of US adults who use a smartphone have at least one financial app. The average smartphone user has 2.5 financial apps. Among millennials (ages 18–37), the average is 3.6. It drops to 2.3 for Gen X (ages 38–53) and 1.4 for Baby Boomers (ages 54–72). The most common financial apps are full-service banking apps; 55% of US adults who have a smartphone have at least one full-service banking app; 23% have at least two. Peer-to-peer payment (P2P) apps (such as Venmo, PayPal and Square Cash) are the second most common. Forty-one percent of smartphone users have at least one of these and 15% have more than one. Standalone budgeting and investing apps are less common; they can be found on just 18% and 17% of smartphones users, respectively. Mint, Clarity Money, and Wally are among the best-known budgeting apps. Stash, Acorns, and Betterment are popular for investing. People with banking apps are the most engaged. Seventy percent say they use them at least once a week. Fifty-six percent of budgeting app users, 51% with investing apps, and 38% with P2P payments apps reported likewise.

Consumers who avoid mobile banking tend to fall into two camps: people who like their routine and people who are afraid of fraud. Twenty-nine percent of financial app users believe financial apps are better than non-financial apps versus just 9% who think they are worse.

Millennials are the most divided generation on this issue: 31% of them say financial apps are better, but 15% say they are worse. Regular use of mobile banking apps has potentially significant implications for the financial health of users. Using mobile banking makes the user more aware of his/her current financial status and impacts his/her financial satisfaction.

Types of Personal Financial Management Apps

According to Investopedia [24], some of the best personal finance apps for managing finance resources in 2020 are the following apps. Each of them relies on embedded sets of models and algorithms that maximize some predefined goal like track past spending and saving habits or plan a future budget or invest excess change or reminder of payment due or improve money and investment management or monitor credit score or keep track of income and expenses for multiple individual projects.

The Best Money Management App is the Mint.com from Intuit. It is a free all-in-one resource for creating a budget and tracking spending which can be linked to bank accounts giving a snapshot of one’s financial situation momentarily and over time. It creates budgets based on previous spending habits and alerts users if they are over spending limits. It also offers a financial goals section that assists in identifying and tracking goals for almost any expenditure [25]. Similar websites are MoneyStrands.com, PearBudget.com, Wesabe.com, JustThrive.com

The Best Budgeting/Debt App is You Need a Budget (YNAB) . YNAB is built around a simple principle that every dollar has a job in a personal budget, be it for investing, for debt repayment, or to cover living expenses and forces an individual to live within his/her actual income. If one gets off track, YNAB helps one to see what can be done differently to balance the budget. There is also a built-in accountability partner. EveryDollar Budgeting is a similar zero-based budgeting app which tracks spending and plans for purchases. PocketGuard , another alternative, builds a personalized budget based on your income, bills, and goals.

The Best Tracking Expenses App is Wally. Wally helps the user to organize and track personal and professional expenses. Wally lets the user scan receipts and add notes allowing the user to see where money has been spent [26]. Wally uses machine learning and AI algorithms to adapt to user preferences and behavior.

Best App for Easy Saving is Acorns. Acorns is a useful app for inexperienced investors.

It links to a user’s bank account and will make investments automatically or manually [25]. It takes the user’s extra change from transactions and automatically directs it to a savings account after evaluating the user’s spending and income history [27]. A similar website is Stockpile .

Best App for Freelancers is Tycoon . This app is perfect for freelancers and those who are self-employed and get paid at the completion of a contract. It standardizes the details of a contract, puts in a timetable for it, and keeps track of payments that have come in, are scheduled to come in, or that are past due. It makes it easy to see which clients have not paid yet.

App users report that these personal finance tools simplify the formerly confusing and complicated investment and financial management process into something approachable, learnable, and scalable, but the question arises if they are making the users better at managing his/her money or encouraging the user to spend more. Money apps can have a positive and a negative effect . They can make an individual more aware of how much one is spending and help one stick to a budget, but the convenience of contactless payment could also be encouraging even more spending [28].

Unlike the standardized instruments for measuring financial well-being, none of these personal finance apps have been validated, although some research in behavioral sciences provide examples of the importance of financial self-tracking on individual’s spending and saving behaviors [29, 30]. A new class of applications and web sites called personal informatics is appearing that collects behavioral information about users and provides access to this information to help users become more aware of their own behaviors. Personal informatics systems support users in understanding various aspects of their life, behaviors, habits, and thoughts. They help users build self-understanding by providing a means to collect personal history, as well as tools for review or analysis. Increased self-understanding has many benefits, such as fostering insight, increasing self-control, and promoting positive behaviors such as energy conservation and financial management [30] (Figs. 17.1, 17.2 and 17.3).

Fig. 17.1
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Screenshot of You Need a Budget (YNAB) app

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Fig. 17.2
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Screenshot of PocketGuard app

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Fig. 17.3
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Screenshot of Acorns Easy Saving Roundup app

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Web-Based Technology Tools for Financial and Investment Analysis

Web-based tools are useful for long-term planning and financial and investment analysis. These tools measure the individual’s attained level of financial resources and then estimates the future level of financial resources based on certain assumptions about investment interest rates, inflation rates, tax brackets, the amount and savings rate through employer-based plans plus individual savings, expected retirement age, and major funding needs such as college funding, home purchase, financial needs for incapacitated relative (such as a child or parent), major medical expenses (such as cancer or a chronic condition), or for a legacy to a charity (such as one’s university). This approach attempts to provide an objective, quantitative assessment of financial resources needed to attain these financial goals and needs. Individuals can then assess the gap between their future financial needs and their estimated financial resources to develop strategies to close the gap. Often this is done with the aid of a financial advisor; hence many of the software programs and technology developed to serve this function have been developed by investment management companies.

More recently automated investing services also known as robo advisors have emerged. Robo-advisors are digital platforms that provide automated, algorithm-driven financial planning services generally with little or no human intervention used to automatically allocate, manage, and optimize a client’s assets and investment portfolios.

One tool, Personal Capital , is an investment management service for tracking wealth and spending that combines the algorithms used by robo advisors with access to human financial advisors. While Personal Capital is primarily an investment tool, its free app includes features

helpful for budgeteers looking to track their spending. It allows one to connect and monitor checking, savings, and credit card accounts, as well as IRAs, 401(k)s, mortgages, and loans. The app provides a spending snapshot by listing recent transactions by category and displays the percentage of total monthly spending by each category. Personal Capital also calculates and tracks user’s net worth and provides a breakdown of one’s investment portfolio [22].

Perhaps the most evident area where technology has impacted the world of investing is in the capabilities to analyze investments and develop investment strategies. Ranging from “the basics” at Yahoo Finance and Google Finance to the more advanced analytics like Morningstar and Bloomberg terminals, to a host of other specialized sites for investment analysis, the capabilities for investment analysis have come a long way.

A more recent crop of tools like SigFig and Jemstep are also making it easier for consumers to analyze an existing portfolio and immediately get actionable advice about what can be improved. The latest technology evolution disrupting the world of investing uses robo advisors—services like Betterment and Wealthfront—that are affordable and will construct the entire asset-allocated passive strategic portfolio for the investor. The depth to the portfolio construction process also makes it feasible to leverage technology tools for additional investment value-adds that were previously done in a more arduous manual processes, from proactive tax loss (or gains) harvesting to supporting good asset location decisions. Such services can now be offered effectively directly to consumers and easily implemented via robo advisors (through advisors and their “rebalancing” and trading software tools) [22].

Robo advisors have a couple of key advantages. Because they do not have to employ many people, they typically have lower fees and lower account minimums than traditional investment advisors. Some robo advisors like Betterment, WiseBanyan, and Bloom even have no account minimums. Of course, robo advisors have drawbacks. For one thing, the user cannot rely on a robo advisor to do complicated financial planning or to give him/her legal advice.

Moreover, a robo advisor will not be able to give the user the kind of nuanced financial advice that a human being might be able to provide.

As more and more tools become accessible directly to consumers, many of the services once provided by financial advisors to analyze, review, and construct client portfolios can now be done at a dramatically lower cost and without the advisor being involved at all. These apps and tools have continued to commoditize many financial resource management functions previously performed by stockbrokers and financial advisors. There has been specifically a rapid growth of the number of personal finance apps and app users and an increase in the amount of monies directed towards these apps, but there has been little or no empirical studies addressing the direct impact of these apps on financial resources and the financial well-being of users (Fig. 17.4).

Fig. 17.4
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Screenshot of Personal Capital Investment Management desktop app

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Other Web-Based Interventions and Strategies

According to Statista, as of February 2020, Yahoo Finance, MSN Money Central, and CNN Money are the three most visited investment and finance websites in the US with 70 million monthly visits, 65 million monthly visits, and 50 million monthly visits respectively) [31].

Personal finance websites now attract one-in-four people who use the Internet, according to comScore.com which tracks Internet traffic, rivaling Facebook in popularity [32]. Currently, the financial capacity in the US is reported by FINRA Investor Education Foundation [33].

There are three categories or models of Web-based personal finance websites which can be of use in enhancing one’s financial assets and financial well-being: Financial Data Aggregators, Financial Decision Aids, and Financial Communities [34].

Financial Data Aggregators are highly effective tools which use the computer’s power to compile and analyze massive amounts of data harnessing computing power to perform complex analyses that few individuals would have the time, interest, or ability to perform on their own.

Aggregators are effective as personal finance tools because they continually analyze the underlying data as it changes. As a result, aggregators keep individuals coming back for fresh information, which, in turn, keeps users engaged and focused on their financial affairs.

Aggregators also encourage individuals to analyze changes, over time, in their finances. These tools apply the same format to the data each time, making it easy to compare progress over months or years. These tools, therefore, provide a framework for a richer understanding of one’s financial profile.

Financial Decision Aids are effective because they calculate costs and benefits that range from simple mortgage calculators to complex online financial planning decisions. By requiring individuals to input their unique data and other personal information, individuals can generate personalized results that illuminate an important element of financial health.

Financial Communities enable individuals to meet and discuss their personal finances and provide support and advice to each other, compete in financial games, swap coupons, or attend virtual parties focused on personal finance. Even personal finance blogs are, in one way, communities and are categorized as such in this report.

Use of Web-Enabled Tools to Increase Financial Literacy and Financial Well-Being

Web-enabled tools can be used to increase financial literacy, financial well-being, and financial satisfaction in later life. The Consumer Financial Protection Bureau (CFPB) publishes financial information to increase financial literacy. They advocate that the ultimate measure of success for financial literacy efforts should be improvement in individual financial well-being [32].

According to the Consumer Financial Protection Bureau (CFPB), financial well-being can be defined as a state of being wherein individuals:

  • Have control over day-to-day, month-to-month finances;

  • Have the capacity to absorb a financial shock;

  • Are on track to meet their financial goals; and

  • Have the financial freedom to make the choices that allow them to enjoy life.

Personal finance apps can provide users with personalized financial information for establishing and monitoring budgets , spending and saving habits, progressing towards financial goals, etc.

Because individuals value different things, traditional measures such as income or net worth, while important, do not necessarily or fully capture this last aspect of financial well-being.

Joo and Grable [35] advocate for the development and testing of a framework for understanding the determinants of financial satisfaction. Direct, as well as indirect, effects on financial satisfaction were identified using a path analysis method. It was determined that financial satisfaction is related , both directly and indirectly, with diverse factors including financial behaviors, financial stress levels, income, financial knowledge, financial solvency, risk tolerance, and education. Findings support the continued and increased use of targeted education initiatives directed at improving the financial literacy and behavior of family and consumer economics constituencies. Quality of life technologies can support these initiatives.

However, although there are a tremendous number of personal finance apps and tools, relatively little has been published on a causal relationship between financial knowledge and financial behavior. Empirical studies of the effectiveness of these personalized QoL technology-enabled tools and interventions in increasing financial resources and enhancing financial well-being needs to be done.

Operationalizing Self-Report Measurements of Financial Resources and QoL

In this subsection we reflect how the above-mentioned tools could help to operationalize data collection for self-reports like IFDFW and MSFWB (defined earlier).

For the IFDFW, the data collected via these technology tools could enable the use of an analytics approach to questions ranging from “Living on paycheck-to-paycheck” basis (in case one’s account is reaching low at the end of the month) to “Ability to handle $1000 financial emergency” e.g., by analyzing all the available assets and the saved amounts for at least $1000 available to an individual. Questions such as “Worry about being able to meet normal monthly living expenses” can be diagnosed and remediated through the creation and monitoring of budgets and establishment of alerts when approaching overbudget limits utilizing budgetary apps. “Ability to manage money” can be assessed through data aggregation from various banking, credit card, and investment accounts and comparison to targets utilizing money management and investment tools.

For the MSFWB which consists of five different aspects of subjective financial well-being—general subjective financial well-being (GS), money management (MM), peer comparison (PC), having money (HM), and financial future (FF), numerous questions can be operationalized using data collected from technology tools. For questions about the having money aspect of subjective well-being such as “At times I do not have the money to buy what I need,” “I cannot do some things with my friends, because I do not have the money to do them,” and “Sometimes I miss the cash to buy things I need,” personalized tools can be used to monitor spending habits against predetermined budgets and setting alerts if going over pre-set spending limits. For questions about evaluating issues such as “Satisfaction with the way I manage my financial situation,” budget and money management tools can provide spending snapshot of recent transactions by category and displays the percentage of total monthly spending by each category so that users can evaluate their money management performance against predetermined targets. Data can be individually analyzed or aggregated across multiple categories—credit card, banking, and investment management. Financial future concerns about “In the near future, having enough money to carry out my plans” can be operationalized by using apps to set up separate budgets for personal expenses from special budgets for future plans, contractual assignments, or multiple projects with different timetables and overlapping income and expenses. These tools are ideal for self-employed, gig workers or freelancers. By using robo advisors or investment management web-based tools and software with some advisory support and comparative investment data resources, a user can answer whether an individual’s “Financial situation is better [or worse] than that of one’s peers.”

The use of quality of life technologies together with standardized self-report-based measurements of financial resources can serve as predictors of level of current and future financial well-being and financial distress and an individual’s quality of life.

Success Factors for Technology Adoption

Computer self-efficacy and anxiety, ability to solve novel reasoning problems (fluid intelligence) and remembering and using previously acquired information (crystallized intelligence), attitudes and experience with technology and the World Wide Web are important predictors of the use of QOL technology-enabled tools [36]. Millennials have often led older Americans in their adoption and use of technology, and this largely holds true today. But there has been significant growth in tech adoption since 2012 among older generations—particularly Gen Xers and Baby Boomers [37, 38]. Older users may not adopt a new tool or technology merely because it is available. They must also perceive how the system is personally useful compared to existing methods [39] and that it is easy to use. As prior research has shown [40], older adult’s adoption of new technologies may critically depend on whether they understand the costs and benefits of those technologies (perceived utility). Previous Pew Research Center surveys have found that the oldest adults face some unique barriers to adopting new technologies—from lack of confidence in using new technologies to physical challenges manipulating various devices [39].

On the other hand, higher evaluation of life quality was found significantly correlated with the number of new media technologies owned. Owning and using new media technology seems to have become a part of defining one’s lifestyle that emphasizes enjoying oneself and enjoying life. Finally, the use of both traditional and new media, except for TV watching, was found complementary in improving people’s living quality [41].

The use of tools for financial management definitely falls into the domain of use of new media technologies, where the gains may be substantial, while, at the same time, the cost of the use may be literal. Namely, the user may lose not only time to learn and operate the tool but may also lose his/her own money, e.g., because of the use of inadequately configured tools. The success for technology adoption in the financial domain is therefore multidimensional, and interdependent and shall be researched further.

Discussion and Conclusions

Around the world, the financial landscape is becoming increasingly complex. In response to this, an array of Web-based and non-Web-based technology initiatives seek to address financial participation, education, and inclusion for the broad population, as well as, for vulnerable populations. There is an increased expectation that these tools and programs will improve the financial well-being of individuals and households. But financial well-being is inadequately conceptualized and inconsistently defined, making it difficult to understand and improve financial outcomes and assess financial resources. Existing conceptualizations do not adequately account for the dynamic interplay between a person’s environment and their financial well-being as well as how aspects of financial well-being can interact according to age, life stages, and culture.

The recent Quantified Self Movement (QS) and the wealth of digital data originating from wearables, applications, and self-reports is enabling QS practitioners to better address the diverse domains of daily life—physical state, psychological state, social interactions, and environmental context which contribute to an individual’s Quality of Life (QoL). This systemic monitoring approach of assessing an individual’s state and behavioral patterns through these different QoL domains on a continuous basis can provide real-time performance optimization suggestions [42, 43].

As the Quantified Self Movement (QS) expands and the availability of quality-of-life technologies grow, the incorporation and self-monitoring of financial resources will become an increasingly important component of an individual’s overall quality of life [42, 43]. In the future, we may see wearable or digital tracking devices that encourage both fitness goals (steps taken, calories burned, hours slept) and financial goals (interest earned, fees avoided, milestones reached). This is one way that financial resources can play a role in the “quantified self”—by encouraging financial fitness. Second, inventive thinking as the intersection of fintech and healthtech can create incentives and new categories for consumers to blend sound physical and financial habits for overall well-being. The self-tracking of quantifiable financial data and qualitative data, e.g., mood, stress, depression, happiness, productivity can enable individuals to monitor changes in their financial behaviors based on changes in physiological and psychosocial factors such as the correlation between spending behaviors and emotional state. Third, self-tracking and monitoring with QS devices and related apps may lead to more proactive than reactive financial behaviors by providing users with information on their credit card and debt management and the financial performance analysis of investment portfolios. Lastly, in personal finance decisions, future wearable devices may be able to nudge the wearer with a gentle vibration, that they just should not buy the product that they are looking at and instead save the money for a more important goal thus leading to better self-management of financial resources and life satisfaction.

An important aspect of the self-tracking of financial resources is that QS financial activity fundamentally includes both the collection of objective metrics data and the subjective experience of the impact of this data. Self-trackers have an increasingly intimate relationship with QS data as it mediates the experience of reality. In self-tracking of financial resources, the cycle of experimentation, interpretation, and improvement transforms the quantified self into an improved “higher quality” self. The quantified self provides individuals with means for qualifying themselves, through which some higher level of financial performance and financial resources may be attained or exceeded leading to greater financial well-being and life satisfaction.

In the case of health impairment, the individual’s financial situation and its relationship with life quality is even more complex. Despite the limited number of qualitative and quantitative studies available, likely owing to the relative infancy of the field, financial resources and the financial burden of treatment seems to play a critical role in quality of life. In particular, the use of the QS tools and methods presented here can better integrate the costs of care and available financial resources when coordinating treatment while attempting to enhance the patient’s treatment outcomes and quality of life.

Thus, the use of QoL technology-enabled apps and methods can play an important role in the overall quantification and self-management of financial resources, the reduction of financial burden and distress, increased financial literacy, and the enhancement of financial well-being and financial satisfaction. Ideally, the use of these QoL technologies should be evidence-based and designed and developed to enhance the effectiveness, efficacy, and appropriateness of their use and based on an understanding of factors that influence acceptance by users. Greater development and integration of quality of life technologies can help address the need for better self-management of financial resources for short-term and long-term goal attainment, and the enhancement of the quality of life of an individual and families at large.