Imagine this… You’ve been burning the midnight fuel to show your boss the results of months of hard work by crafting the picture-perfect presentation. With one hour to show-time, you’re filled with anticipation because you know it’s going to be that ‘once-in-a-lifetime’ moment sure to get your work noticed. Then all of a sudden, the screen… goes… blank! In the blink of an eye, you watch helplessly as your masterpiece evaporates into the obscure abyss of your computer. But fear not! You’re confident the automatic save utility on your computer protected all that hard work, but it didn’t. In retrospect, you commence to questioning why you didn’t take the time to set up auto-save. The simple fact remains; you didn’t and now you can’t make up for lost time.
Sound familiar? In this day and age, there are limitless options at our disposal to help us save time in our everyday lives via automation. Voice activated devices, robots with artificial intelligence, personal computers, and mobile phones; the list goes on. However, making a conscious effort to setup activities to perform automatically may seem pointless until something happens that makes you think otherwise.
Take saving for example; it can be hard when everything is vying for the attention of all your extra money. Add lack of self-control and savings will inevitably take a back seat to all other expenses. You see, in the past, I was more of a long-term saver than a short-term saver (even though I knew how important short-term savings was). For years, nothing seemed to work as I grappled with methods to increase my chances of becoming a better short-term saver. What helped me convert was the same method I had been using all along for my long-term savings—automation.
Use Automation: Automation can take the sting out of putting money aside. Nowadays, most institutions offer automatic savings options (or even an app) to help you achieve your savings goals. By doing so, you can set-up transfers between accounts and establish savings parameters such as the frequency and amounts to save.
There are many online banks that offer a savings account such as Digit, Ally, Synchrony, or Capital One (to name a few). Other apps (such as Acorns) are good for setting up long-term savings/investments.
Use Separate Accounts: Although automation can be beneficial to your savings effort by helping you put money aside, the real challenge is not using the money once it’s saved.
I began using the app Digit (FDIC insured up to $250,000) a couple of years ago. To be honest, doing so has changed the way I save for the better. As a matter of fact, there have been periods when I saved over $500 (in as little as a month) without even noticing the money had left my primary account. They do this by evaluating your spending, tracking balances, and transferring small amounts ($20, $15, $30, etc…) from your linked account into your Digit account every couple of days. What is so great about this account is the fact that it is separate from my primary account used for bills and daily living expenses. Because of the “separateness,” I rarely view my Digit account—out of sight, out of mind is my motto!
Don’t like apps? Open a savings account using a brick and mortar bank or credit union. If you do, make sure it is at a different bank from your primary bank otherwise it’s too easy to track and see that savings grow (avoid temptation). Be sure they know not to give you a debit card linked to that account. Having a debit card can tempt you into using the money for unnecessary purchases.
Take Advantage of Retirement Benefits: Let’s not forget pre-tax money. If your employer offers a retirement plan and they match contributions, set up an account right away. This way it will be automatic and correspond with your pay dates. If you don’t do it right away, you’ll get used to living off of your salary and may find it harder to start later on.
Take this time during America Saves Week to do the right thing.
Guest Contributor: Barbara Chilton, AFC®