Asset Protection, Finances

Automating Your Finances for Retirement Wealth Planning

Writting with a pen

Budgeting and keeping your financials in check is not the most enjoyable task on the planet, but it’s a necessary one nonetheless. It’s also a time-consuming process and one that can cause undue stress in your life.

From making sure bills are paid on time, to ensuring enough money is in your checking account to cover expenses, to wealth planning for retirement, taking care of money can be a daunting chore.

There is a silver lining, however. These days, there are a host of technological tools that can be accessed and utilized to streamline the process of managing money. Instead of manually sifting through every inch of your financials, you can let an automated process do it for you. Not only will this save you time, but it will also save you headaches too.

What Exactly Does it Mean to “Automate” Your Finances?

It’s exactly as it sounds: automating your finances essentially means putting your money management process on autopilot. It’s a set-it-and-forget-it plan that takes the manual labor out of ensuring all your financial ducks are in a row. Just plug in a few numbers, make a few phone calls, but the plan is in gear, and let it run itself.

By setting your financial planning in automatic mode, you’ll be much less likely to spend money that should otherwise be invested for your retirement. Many well-renowned financial experts hail this method of
financial planning as a must when it comes to financial success. David Bach – one of the most popular financial experts across the globe and author of bestsellers like The Automatic Millionaire and Debt Free For Life – is a huge proponent of automating finances for retirement.

The steps to setting your wealth planning in auto mode are simple.

Automatically Set Aside a Small Percentage to Your Retirement Fund

No matter how much money you make or how much debt you have, it’s vital to take a minimum of 5 percent of your regular paycheck and deposit it directly into an IRA, 401(k), or other retirement or investment account before the government taxes it. Don’t depend on yourself to make this deduction – you’ll likely find a reason to use that money for other purposes.

Instead, the process of deduction should be automatic. Have your bank set up a systematic investment plan where money is automatically transferred into your retirement account from your payroll deduction. The majority of financial institutions can handle all these arrangements on your behalf, including contacting your employer’s HR department and dealing with all paperwork.

Set Up Direct Deposit

Forget about tangible paychecks. Part of automating your finances includes having your payroll deposited directly into your bank account electronically. There’s no reason to collect a paper check any longer, and just about every company out there offers their employees the option to have pay directly deposited into a bank account.

Putting your finances in auto mode makes things much easier when it comes to wealth planning. In fact, direct deposit has become the norm for just about every business, and with that, many companies require their employees to use direct deposit instead of receiving paper checks. Not only is this more efficient, but it will also hinder you from blowing your check the moment it enters your hands.

Simplify Your Bill Payments

Some bills are the same amount each month, while others will change from one bill period to the next. Automate the payment of the fixed-amount bills by putting your bank’s online bill-paying service into practice and have them automatically deducted from your account every month.

With the variable bills, automate these payments by having them charged to your credit cards. Just make sure that your bank account always has enough funds in it and the credit limit on your credit card is sufficient in order to avoid missing a payment. This way, all your bills will always be paid on time without the need for you to manually do the job yourself.

Automatically Pay Your Credit Cards

Just like all your other bills, your credit card bills should be paid automatically as well. Considering the fact that you’ve set up your credit card to be the source of many of your other bill payments, you need to make sure that this account is paid on time and in full every month.

If you have multiple credit cards, call these companies and request to have all your bills sent to you on the same day each month (after you get paid would make the most sense). You can then automatically pay the minimum balance of each card a few days before it’s due via your banks’ online bill payment service. Making minimum payments automatic guarantees that you’ll never miss a bill payment due date and get slapped with penalty interest rates and a ding on your credit.

Set Up Your Emergency Account to be Funded Automatically

It’s always a good idea to have some money set aside for a rainy day. Experts tend to agree that this amount should ideally cover a minimum of three months’ worth of expenses. In order to fund this account, have at least 5 percent of your regular paychecks deducted and deposited directly and automatically into this account. Once it’s been fully funded, make sure to leave it alone until the need arises.

Automatically Pay Your Debt Off

Whether it’s a car loan, student loan, or any other type of debt that you have on your books, paying these off is a necessity. Instead of depending on your own discipline to make these contributions, have your accounts set up to automatically pay off these debts.

Contribute an amount that you’re comfortable with every month, and have it transferred from your checking account directly into the loan account that is still outstanding until it is paid off. Start off by paying your largest debt that is attached with the highest interest rate. Once that loan is paid off, move on to the next, and so on.

The Bottom Line

Not only does automating your payments make life a lot easier for you, but it also helps ensure that your bills are actually being paid off when they should be without missing a deadline. All it takes is an hour or two to get your accounts set up, and you can effectively get your finances in control. Rather than focusing on all your bill payments, all you need to do is make sure your accounts are adequately funded.

At Protect Wealth Academy, we are dedicated to helping Americans gain financial control and effectively plan for their retirement years. Wealth management requires a certain degree of education, which we at Asset Protection Academy are committed to providing Americans from every financial bracket.

To find out more, check out our extensive video library with all the information you need to make the right financial decisions.

Register For A FREE Asset Protection Summit!

Join thousands that have attended the Longest Running Wealth Protection Event in the nation. America’s greatest attorneys and trainers, LIVE and in-person at one event.