- Digital Content Experiments
- Posts
- Tip #9 - Automate Your Money
Good morning!
Grab your double-espresso and enjoy.
This is tip #9 of nine financial freedom tips I’ve shared over the past nine weeks. BONUS TIP NEXT WEEK!
This is my favorite tip.
I love the idea of building my money system and letting it do all the work for me. I feel like it embodies the definition of financial minimalism - simplify your finances.
If you know your priorities, accounts, and amounts, then you can automate (almost) all of it. Reducing time, energy, and financial stress every month.
Plus! If you set up your flow correctly, it all works before you can accidentally spend all your money before paying yourself.
My money automation and flow:
401K max contributions coming out of paychecks as withholdings to my Vanguard account.
Paychecks are direct deposited to a Charles Schwab checking account.
A Mint.com budget tells me how much is transferred to the savings account (travel and allocated funds in Capital One) and to the taxable brokerage account in Charles Schwab.**
**These last two transfers could be automated as well (have them go directly from my pay into the accounts) but I get a TON of satisfaction completing those transfers each month. It’s my little carrot to focus on my money by seeing how much I put into my travel and investment accounts.
TIP #9 - Automate Your Money
You probably have a direct deposit setup and if you don’t, then you’ve moved down my favorite person list and that is your 30-minute action below. :)
Hopefully, you have 401K contributions coming out of your pay, but you may not fully take advantage of your company’s 401K plan. If this is you, then increase your contributions. At least meet your company match, but work your way up to maxing out your contributions.
If you don’t see it, then it’s harder to blow it on non-priority expenses.
Create your budget based on only what you see hit your checking account - investments, savings, and “other” accounts receive funds automatically and without decision-making on your part.
By thinking through and developing your system, you’ll remove month-end energy from figuring out where your money went, if you have enough leftover for your priorities, and you’ll love seeing your accounts grow every month.
By automating your finances, you pay yourself first, reduce the risk of spending the money on non-priority expenses, and reduce the amount of time you think about your finances every month.
In the next 30 minutes…
Depending on your current setup, do one of the following in the next 30 minutes:
Log into your employer's self-service portal and set up direct deposit into at least your checking account, possibly a savings account if you know how much you want to save a month.
If you can only deposit your paycheck into one account, then go into your checking account and schedule a reoccurring transfer to your savings or investment account based on your budget and priorities.
Log into your employer’s retirement portal and select a 5% contribution to your 401K. Adjust your budget and make it work. Every two months increase this by 1% until you’re maxing out your annual contributions.
Do the work now, set up your process and automation, and enjoy the rewards later.
Remember, intentional money equals intentional life.
Please HELP me spread the word.
If you’re enjoying the newsletter, please share it with one person you believe can benefit from it.
I hope you all have an amazing week!
Quinn