5 Tips for Automating Your Personal Finances
- Author: Jeffrey Simmons
- Posted: 2024-05-27
One of the biggest things that can hurt your credit score and your personal finance situation is when you simply forget to pay a bill on time. You may also make a calculation error that can cause you to have an overdraft on your account. Automating your personal finances can take some of the human element out of it, reducing the risk of an error or oversight that may hurt you. The less you have to think about the logistics of your personal finances, the more time that you can devote to getting ahead. Here are some tips for automating your personal finances.
Set Up Automated Bill Payment
Forgetting to pay your bills on time will have a number of different negative impacts. Not only will you need to pay late fees, but it will also hurt your credit score. Sometimes, you simply forget to pay a bill by the due date. It is human, and it happens occasionally. Setting up automatic bill payment can spare you from the costs of forgetting to pay bills. Of course, you still need to check your bills once they arrive to ensure that there are not any irregularities. Nonetheless, putting as many bills as possible on auto pay will not only make your life easier but will also preserve your efforts to boost your credit. Not only that, but some places may even give you a discount on your bill when you sign up for automatic bill pay.
Use an Automated Sweep to Save
There are helpful programs that can sweep the change from all of your purchases into a brokerage account for investing. By the time you are done, you could have hundreds of dollars each year socked away into an account where it is earning money. This means that you can invest and not even think about it. Many people struggle with the act of actually putting money into an account. When you either sweep your change into an investment account or have a regular and recurring contribution, it takes the human element out of it. Ideally, you should be doing both of these to maximize your savings.
Use Budgeting Apps
When you are trying to figure out your budget, having to use a calculator or pen and paper is confusing. It will lead to errors, and the difficulty will keep you from budgeting as you should. The best way to automate your budget is to install an app on your phone. This way, you can have access to your budget at all times. Any expenditure that you make, you can instantly enter into your budgeting app. You can also have immediate access to your budget when you are considering whether you are able to afford something. You can see the impact that a purchase would make on your monthly budget. This will keep you from outspending your budget.
Install Mobile Banking on Your Phone
Having immediate access to your accounts gives you information about your personal finances at your fingertips. You are able to move money between your accounts with a few swipes on your phone. Moreover, you can deposit checks quickly, keeping you from having to wait to go to the bank. While this is not fully automated, it is a way of using technology to your benefit when it comes to personal finances. It will keep you from having to manually balance your checkbook when you are able to see on a real-time basis where your accounts stand.
Link As Many Accounts Together as Possible
Being able to link outside financial accounts to your bank helps you save and move money back and forth between accounts with a minimum of efforts. At a minimum, your bank account should be able to link to your investment account. This will help you automatically invest as much money as possible. The problem comes when you have to do manual transfers between your accounts. This hurts you when you need to come up with money in your checking account in a hurry to cover a bill. It also means that money will take time to hit your investment account and keep you from being able to invest in the market quickly. When your accounts are all connected with each other, it allows for seamless management of your personal finances. There are numerous online banks that can make this all easy for you.
