Age with Grace: Digital Payment Options
“Cash, check, or charge?” used to be the standard question when making a purchase. But today, there are more options like PayPal®, Zelle®, and Venmo®. What these options have in common is that they are digital transfers. What is special about Zelle® and Venmo® is that they allow person-to-person transfers.
So, what does this mean for you? That is for you to decide but here is some information so you can make some well versed choices.
The benefits of digital payment options.
Zelle® and Venmo® can be very convenient. You can congratulate a grandchild for a straight-A report card the moment you hear about it. You can split a restaurant bill among friends, even if you do not have cash on hand by reimbursing the friend who pays the bill right from your phone. And you can quickly and easily collect money from family or friends who want to contribute to a joint gift—even if they live far away.
Digital payment options provide real-time transfer opportunities. They are convenient for our society that continues to move away from carrying cash, and they are a great way to send money to younger generations who have embraced digital money transfers. In short, digital payment options provide an easy way to access and transfer money.
What are the potential downsides to digital transfers?
First, both you and the recipient must have some amount of comfort with technology. You can use a service like Zelle® right from your desktop computer as long as you are already banking online. The transfer will just show up in the recipient’s bank account once they are signed up for the service. For something like Venmo®, you will need to have an application downloaded on your phone and connected to a bank account, and the receiving person will have to have the app on their phone as well.
Another potential downside is mis-sending money. If a transfer is made in error, the only recourse is to request that the unintended recipient send the money back—it is totally their choice. Regardless of which digital transfer option you are using, it can be a good idea to send a test amount first to make sure that the user information you have is correct. Once you have made a successful transfer, the recipient’s name will become a part of your history and you can easily reference it for future transfers.
You will also want to remember that while the transfer notification is immediate, the actual transfer of funds is not. The recipient will typically have an option to pay a small fee for immediate access to the money you have sent, but otherwise will have to wait one to three days to receive the money once they request the transfer to their account.
Finally, consider the occasion. A digital transfer is definitely less personal. For a quick reimbursement to a friend or a thoughtful surprise, a digital transfer is a great solution. But for a special gift like a birthday or holiday, chances are, your handwritten card is still the best way to send a monetary gift.
Adding a digital option to your lineup of payment methods could be a good thing, but it is not a necessity. Consider how comfortable you are with technology, who you would want to send money to and their comfort with technology, as well as what occasions you would use it for.
If finances are on your mind and it is time to start or review your estate plan, Call Wilson Law PLC today at 866-603-5976 or fill out our contact form and we’ll call you to schedule your meeting.