Managing household finances can feel overwhelming at times. Life gets complex and crazy, and money seems to come and go at lightning speed. Often, you are left wondering,
“Should I have made that purchase?”
“Will we have enough money for the bills?”
“What about retirement?”
“Did we give to our church this month?”
“Why isn’t this easier?”
It can be easier.
As a family of five, our schedule does not give us the luxury of spending hours each week with the finances. But we don’t use this as an excuse for making unwise or negligent money decisions. Instead, we look for more efficient ways to manage our money.
We are fortunate to live in a day when numerous financial management technologies are available to us. One of the most impactful ways our family uses this technology is automation. Automation allows a person to make financial decisions in the present that will be executed in the future. Though we never truly “set it and forget it,” we certainly “set it.”
Here are five money moves our family automates:
1. Generosity. Giving is a priority for us. Automating our generosity ensures we put God first in our finances. We do this through our local church’s giving website page.
2. Bills. Who likes late fees? Not us. We try to set up as many automatic bill payments as possible. Most of the time late payments are due to simple forgetfulness. So, we let technology remember the payment for us. Most of the time, this is set up through the service provider’s website. However, if the service provider does not have an online payment system, you may be able to set up a regular payment through your bank’s online payment system. They will sometimes cut a check on your behalf.
3. Retirement Savings. This automation keeps us on track for funding our later years. For most, this means setting up contributions through your employer to your employer-sponsored retirement plan, like a 401(k). If your company does not offer a retirement plan, you can set up and IRA and have the investment company automatically withdraw funds from your checking account each month.
4. Sinking Funds. A sinking fund is money regularly set aside for a future expense. We have automatic transfers go from our checking to specific savings accounts for future car purchases, our children's education, and vacation.
5. Budget tracking. We use a budget app to track all our spending. The app is not perfect, but it is a big help. Mint, MoneyWise, YNAB, and EveryDollar are all very popular and helpful budgeting apps.
If managing your money overwhelms you, consider what you can automate. This approach can be incredibly reassuring, knowing your money will do exactly what it should be doing.