When you wake up in the morning, you’ve got a routine down like it’s nobody’s business. Hop in the shower, dry off, cook breakfast, fix a lunch, sip that coffee cup, brush your teeth, check your email – etc. You’ve got your routine down to such a science, that even if you woke up a half hour to an hour later you could complete your morning routine checklist…with your eyes closed. It’s second nature. Quite honestly, it may be the one part of your day you do not even have to remotely think. You can accomplish tasks & prepare for the day pretty much, automatically. There may be a few other things in your life that may be this automatic, but maybe not every facet of life is just as mechanical.
What if I told you that your personal finances could be automated…would you be interested? No more staying up late at night tossing & turning only to jump out of bed because you forgot to pay one of your bills (please, please do not charge me a late fee!). Not another minute spent on whether or not you remembered to set aside money to your savings. You have the ability to create a structure in which your money can be designated, moved, transferred and more that does not require any manual labor. Of course there is the initial set up – but these set ups will save you minutes & hours…more time to spend on the things around you that you know and love. Not to mention – you can establish the comfort of knowing that all your bills are paid & accounted for, your savings/nest egg is taken care of, and you, my friend are one personal finance idol!
Fortunately, millennials are incredibly comfortable when it comes to technological advancements. Something new to make a task more easy & convenient? Sign me up! There’s an app for that? Right on! That’s why I have faith in knowing that each and every one of you are indeed capable of automating your finances. Here’s lookin’ at you Gen Y’er!
What are some ways I can incorporate automation to my finances?
There are an incredible amount of ways to automate your finances (especially depending on what you view as “automatic”), but I am going to get you started with just a few. Here is a list in which you can create a seamless process for your finances to work themselves with minimal effort required (just gotta get through the set-up phase)!
1. Sign up for automatic deposit to your 401(k)
This is glorious because you can have your set percentage/dollar amount pulled directly from your paycheck. You won’t believe how much you won’t even miss the money because it does not touch your bank account! There is no temptation to spend the money that has been set aside to your retirement. One step closer to dipping your toes in the sand in your golden years.
2. Participate in automatic bill pay
If your service providers have automatic bill pay programs where a designated account/card can be billed, take advantage of it. You can set which date you would like for your account/card to be billed specifically, that way you know when the withdrawal/charge will occur. Most programs will also allow you to set up a notification for when the billing will take place via email, text message, etc. In fact, some companies will provide a discount for enrolling in automatic bill pay. On the contrary, some companies will bill you extra if you pay manually for your bill. For example, a processing fee of $3.50 is tacked on to your bill amount. That additional $3.50 charge is an extra $42.00 you are paying per year by paying a bill manually – taking away your precious time in the day!
3. Set up automatic transfers through your bank
Want to set aside some savings, but always seem to forget & all of a sudden the money you meant to save…is well, oops – spent? Prevent that from happening! Set up through your bank or credit union to have automatic transfers from your checking to your savings account. You get to choose which dollar amount you would like to have transferred. With this, you can also choose the day in which you would like this automatic transfer to occur. Want to set it up on your pay-day? Just like your deposit to your 401(k), you won’t even realize the money has left! Whatever money is left in your checking account after your deposits & transfers is what is meant to work with. Rather have your money automatically transferred to savings at the beginning of the month? You’ve got it! Contact your bank today for additional questions and how you can get started.
4. Create automatic payments to your credit card
Don’t want to think about having to pay off your credit card before the due date? There’s a way to do that as well! Just like automatic bill pays, you can also set up automatic payments to your credit card on a designated date of the month. Most of the time, you can choose whether you want the minimum, or full amount paid that has been charged to your credit card. Be sure to contact your bank when determining if this is an automation method that would work for you.
5. Utilize an automatic budget
Just like in my ‘I like big budgets & I cannot lie‘ post – utilize tools & apps to create automated budgets. Sign up for Mint, LevelMoney, LearnVest and more! The best part? Most include tools to see what kind of timeline you’re working with to accomplish a savings goal if you set aside a particular dollar amount. This could help determine that automatic transfer to your savings account! Are ya starting to visualize how all this automation works hand-in-hand with your personal finances?
This is great! How do you automate your finances?
I’ve been working on creating my little system of automated finances since I read the book I Will Teach You To Be Rich by Remit Sethi (highly recommend). There were some automation aspects I utilized already, but by incorporating more automation aspects I am able to maintain my spending and grow my savings with very minimal stress. Do keep in mind, regardless of automating to keep things easier – I do still go through and view/monitor some of the automation. This allows for no unexpected expenses/bill payments to occur, or laziness to ensue. It also reminds me that if I end up changing a credit card, or leave a particular service company that I will need to engage in the process to stop automatic bill pay. Here are the ways that I utilize automation for my finances:
1. Bi-weekly my chosen percentage/dollar amount is taken from my paycheck & deposited into my employee sponsored 401(k) program
2. Every week a chosen dollar amount is automatically deposited into my Traditional IRA, Emergency Fund, & designated Savings Goal through my roboadvisor – Betterment
3. Each monthly bill (water & electric, additional utilities, car payment, car insurance, internet) is set up through automatic bill pay
4. Each month a designated dollar amount is transferred to a 2nd checking account (for Short Term Rewards Savings/discretionary spending) & my savings account
5. My monthly budget is automated through Mint, LevelMoney & LearnVest (I use all 3 just because I like using the different features they offer – you really only need to use 1!)
So there we have it…I’d like you to consider to automate your finances in order to alleviate the stress! Besides the ideas I have mentioned, look in to some other ways you can automate in order to create more confidence in your personal finances. You’ve got the ability to create ways to build up that savings, beef up your retirement fund, and take care of your monthly bills in a timely & responsible manner. Create your own personal finance system today and put those hard earned dollars to work – you then will start to realize how much more money you actually have to treat yourself too!
Shaping up your financial game plan to be more stress free one post at a time…