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When Facebook's Libra makes it the mainstream crypto course, it can be a new threat to consumers: their own bad spending habits.
Libra is a proposed crypto competition designed by Facebook and operated with a consortium of partners, including payment companies, credit card companies and consumer companies. It is set to begin in the first half of 2020.
In a Facebook white paper, the company maintains that Libra will not be linked to a user's targeted ads data. Yet, the social media giant has planned to include Libra payments into its own products used by billions of people, which leads to other concerns, experts say.
"For a number of users, the easy access to a tool that can be used for purchase and private consumer activity can be dangerous, especially for those who already have a difficult time keeping control of their budget," said Bruce McClary, vice president of communications to the National Foundation for Credit Counseling.
Facebook officials did not respond to requests for comments.
More than one-third of Americans reported that their spending was affected by social media experience, according to Charles Schwab's 201
The survey, conducted in February, analyzed how 1,000 Americans control their money.
Social media was ranked as the top "bad" influence in terms of money management by investigative respondents.
] Facebook announced its cryptocurrency , called Libra
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Libra Can make it easy to translate because it's easy to access, says Tyrone Ross Jr., an investment advisor specializing in crypto-competition in Woodbridge, New Jersey.
"Knowing how people are, if it's easy to do something, they're going to have it," he said.
Compared to cryptographic curves like bitcoin, Libra can be easier to use for everyday exchange as a bill that pays or buys groceries, Ross said.
Libra was developed as a currency for exchange, and will be less likely to be used as an investment asset like bitcoin, Ross said. It is supposed to be a "stable digital crypto competition" and will be "fully backed up by a reserve of assets," including bank deposits and short-term government securities, according to the company's white paper. That means it should not have willing fluctuations in price as other crypto curves.
Bitcoin is not so appealing for exchange purposes because there is little clarity on how it can be used and it requires technical knowledge, Ross said.  Efforts to gamify or digitize money will result in an "increase in thoughtless purchasing costs," said Priya Malani, founder of Stash Wealth in New York.
She said the convenience and efficiency of the payment makes it much easier to share with your money.
David Marcus, vice president of messaging products for Facebook Inc., speaks during a Bloomberg TV sideline interview by the Wall Street Journal D.Live Global Technology Conference in Laguna Beach, California, USA, Wednesday, October 18, 2017
Patrick T. Fallon | Bloomberg | Getty Images
David Marcus, head of Facebook's Calibra division, to develop products around the new crypto curve, said the company could offer other financial services, including loans in the future.
Lending can become problematic if consumers borrow to maintain an unsustainable lifestyle, Malani said.
"If you are not careful, only this purchase can be many years of repaying the money you borrowed, high interest rates," she said.
This year, US consumer debt reached everything
A customer, left, hand over US twenty dollar bills that she pays for her purchases in Frankfurt, Kentucky.
Luke Sharrett | Bloomberg | Getty Images
If you want to stay out of debt and not overpay with paper money or its digital cousin, try the following steps:
Make the process less automatic. "The payment of the pay is so far removed from the present," said April Benson, a psychologist specializing in compulsive action. "Everything to do less automatically is preferred." Logging out of favorite shopping sites on your computer will make it much harder to use impulsively.
Change your philosophy of action. Benson says that clients should think about shopping when it comes to long-term rewards. "Think of shopping in a wider angle lens," she said. "Not just as buying but buying experiences and enjoyment."
Stick to your budget. "It doesn't matter what the currency is, whether you have $ 100 million or $ 100, a budget is so important," Ross said. He said it is useful to follow a budget template to track where and how much you spent your money even when using Libra in the future.
Learn as much as you can. "The wave is here. If you trade with other financial services, it comes. It's here," Ross said. He recommends reading about Libra, asking questions for experts, and understanding what expenses Libra will be like.
"I have no confidence that larger companies will take time to educate people on how (Libra) will transform their lives," Ross said.