Project Description
BudgetMate Project: Data Story
1. Overview
BudgetMate is a personal finance management tool designed for New Zealanders, empowering them to take control of their financial future. By analyzing public datasets and utilizing AI, it provides users with insights that shift their financial behavior from reactive to proactive.
2. Problem Statement
Many New Zealanders struggle with better financial management due to a lack of financial literacy and the non-availability of effective tools. The goal of BudgetMate is to create a user-friendly solution that helps individuals:
- Analyze their spending and saving habits.
- Receive personalized suggestions to improve financial habits.
- Utilize public data for real-time financial insights.
3. Key Features
The following are the core features of BudgetMate:
3.1 Personal Finance Personality Tool
Financial Personality Analysis: This tool helps users understand their financial behavior based on their spending, saving, and investment patterns. The tool uses public datasets combined with user-specific financial data to provide tailored insights.
3.2 Custom Reports
BudgetMate offers custom reports that provide detailed insights into a user’s financial behavior over time. These reports help users track their financial progress and make informed decisions.
3.3 Smart Financial Advisor
The AI-powered Smart Financial Advisor provides real-time advice on budgeting, saving, and spending based on the user’s financial personality and open data sources.
3.4 Real-Time Financial Health Score
The application calculates a Financial Health Score to give users an easy-to-understand overview of their financial well-being. This score is updated regularly based on spending habits, debt, and savings goals.
3.5 Spend and Save Insights
Real-time insights allow users to track their spending trends and savings goals in real-time, making budgeting and financial management simpler and more effective.
3.6 Akahu Bank and Card Linking
Through the Akahu API, BudgetMate allows users to connect their bank accounts and cards for automatic transaction imports, spending categorizations, and detailed financial analysis.
Conclusion
BudgetMate empowers New Zealanders by providing personalized financial advice and tools to help them make better financial decisions. Through the use of AI, real-time data, and insights, BudgetMate enables users to achieve financial security and long-term success.
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Data Story
Data Story: Kiwi's Ownership of Financial Future
Data Story: Kiwi's Ownership of Financial Future
Chapter 1: Financial Management in New Zealand - Challenge
Handling personal finance is an upward struggle in a country where the cost of living is very high, with the ratio of household debt to household income blowing out. The majority of New Zealanders consider it a huge challenge to monitor their spending, save regularly, or plan for the future. In fact, Stats NZ reported that the national household savings rate remains low, and many households carry high levels of debt compared to their income.
However, the problem for many Kiwis isn't not having enough money; rather, it's a lack of the right tools to manage what little they have effectively. They need help in understanding where money goes and what they can do towards financial security.
The Problem:
- Low savings ratio, with increased spending on less important things.
- Household debt is increasing with deteriorating financial security.
- Many Kiwis struggle to track their finances effectively or plan for long-term goals.
Chapter 2: Enter BudgetMate – Personal Financial Insights for Kiwis
BudgetMate was built to give Kiwis the power by providing them with tools to take control of their finances. The app uses open public datasets and real-time data to offer personalized insights into spending behavior.
Data Insight 1: Spend Pattern Analysis
One of the greatest mysteries for Kiwis is knowing where their money goes. According to data on consumer spending from Stats NZ, the majority of spending by New Zealanders falls into discretionary categories like dining out or entertainment.
Scenario:
John lives in Wellington and decides to connect his bank accounts to BudgetMate using the Akahu API. Within minutes, BudgetMate classifies his transactions and generates a spending breakdown for the past month:
- Groceries: $400
- Dining Out: $350
- Entertainment: $200
- Rent and Utilities: $1,000
What Action Is Taken?
John immediately notices that he overspends on dining out. BudgetMate recommends reducing dining expenses by 20%, potentially saving him $70 per month.
Chapter 3: Identifying Financial Personalities
Through AI-driven analysis, BudgetMate determines the user's financial personality, helping them understand their behavior with money. Most Kiwis fall into categories like "spenders," "savers," or "investors."
Data Insight 2: Financial Personality Categorization
BudgetMate identifies John as a "spender" based on his spending patterns. His spending-to-saving ratio is too high: he spends a large percentage of his income on unnecessary items and saves only 10% of his monthly income.
Personalized Advice:
The Smart Financial Advisor suggests that John should save at least 20% of his income and provides suggestions on cutting down expenses, such as reducing dining out and limiting online shopping.
Chapter 4: Enhancing Financial Health with AI
After receiving personalized advice, John begins tracking his progress. BudgetMate continuously checks his transactions against his goals, adjusting its recommendations when necessary.
Insight 3: Financial Health Score
BudgetMate calculates John's Financial Health Score, based on saving rate, spending habits, and debt levels. Initially, he scores 65/100, but with room for improvement in saving and cutting discretionary spending.
Action Taken:
After a few months of cutting discretionary spending and saving more, John's Financial Health Score improves to 85/100, putting him on the path to financial security.
Chapter 5: Using Public Datasets for Better Recommendations
BudgetMate uses public datasets to give more relevant, data-driven recommendations:
- National Household Savings Rate: John compares his personal savings rate with the national average and receives recommendations to save more.
- Consumer Spending Patterns: Based on Stats NZ data, BudgetMate shows that John spends 15% more on dining out than the average Kiwi household.
- Debt-to-Income Ratio: BudgetMate alerts John when his debt levels reach concerning thresholds and offers advice to reduce his credit card debt.
Chapter 6: Custom Reports and Real-Time Feedback
BudgetMate generates detailed reports to track financial health over time, including spending trends, savings progress, and debt reduction.
Data Insight 4: Custom Reports
After six months, John runs a financial report showing:
- Dining Expenses: 25% reduction, saving an average of $100 per month.
- Savings Rate: Increased from 10% to 20%, reaching his emergency fund goal faster than expected.
- Debt Reduction: John paid off $1,000 of credit card debt over six months.
Chapter 7: Alerts, Quests, and Achievements
Managing finances can be overwhelming, but BudgetMate keeps users motivated with real-time alerts and financial quests. John receives alerts when he nears his budget limits and earns achievement badges for reaching savings milestones.
Conclusion: Changed Financial Habits
In six months, John's financial habits transformed. He went from overspending to consistent saving and debt reduction. With personalized advice and real-time insights, BudgetMate empowered John to take control of his financial future.
Data Insights Summary:
- Spending Patterns: Compare spending against national averages with personalized advice.
- Savings Goals: Real-time tracking helps users achieve their savings goals.
- Financial Health Score: A clear snapshot of financial health with areas for improvement.
- Custom Reports: Summarizes financial progress to adjust goals and improve habits.
