We present the development and characterization of a generic, reconfigurable, low-cost ($<$ 350 USD) software-defined digital receiver system (DRS) for temporal correlation measurements in atomic spin ensembles. We demonstrate the use of the DRS as a component of a high resolution magnetometer. Digital receiver based fast Fourier transform spectrometers (FFTS) are generally superior in performance in terms of signal-to-noise ratio (SNR) compared to traditional swept-frequency spectrum analyzers (SFSA). In applications where the signals being analyzed are very narrow band in frequency domain, recording them at high speeds over a reduced bandwidth provides flexibility to study them for longer periods. We have built the DRS on the STEMLab 125-14 FPGA platform and it has two different modes of operation: FFT Spectrometer and real time raw voltage recording mode. We evaluate its performance by using it in atomic spin noise spectroscopy (SNS). We demonstrate that the SNR is improved by more than one order of magnitude with the FFTS as compared to that of the commercial SFSA. We also highlight that with this DRS operating in the triggered data acquisition mode one can achieve spin noise (SN) signal with high SNR in a recording time window as low as 100 msec. We make use of this feature to perform time resolved high-resolution magnetometry. While the receiver was initially developed for SNS experiments, it can be easily used for other atomic, molecular and optical (AMO) physics experiments as well.