Automate that thing, your savings, that is
In my last post, I lightly mentioned and highly recommended to automate your savings and investing. I say this because building wealth should be the most boring process of them all. Let me explain: When you see your big balance in your bank account when you get pay, you feel like you have enough for everything plus special lunch and extra dessert that day, just because you got paid…have you seen the restaurants on paycheck days? Exactly my point. The last thing you want to do is put money aside. We will work on that mind shift. For now, start by putting that money aside before it hits your bank account.
When you automate your savings, you get to do nothing else but watch it grow. See? Boring.
The easiest way to do this is working with your payroll department. At this point, 2021, I dare to say 98% of the companies pay you through direct deposit to the bank account you tell them to. Well guess what, most companies will divide your paycheck to be direct deposited in 2 or even more bank accounts. These are just AMAZING news for you! What you decide to save can go directly to the bank account you designated for this purpose without you moving a finger. All the work you have to do is done the day you set up this order into your payroll profile. You won’t have to think about it, plan it for the weekend when you “balance your checkbook”, make sure you have enough, etc. It will be in your savings account right away; you won’t even see it in your main account. Isn’t it wonderful? Please tell me I made your day…you’re welcome!
Most of us are ok with putting our bills on automatic debit. We don’t feel a thing! That’s exactly why while we don’t think those $19.99 charges are causing any damage, they really are. You pay for that gym membership on a monthly basis, it is automatic, you don’t miss one single payment…how many times have you actually gone? Guess what else is taking automatically from your paycheck: your taxes, Uncle Sam does not play games.
We can make these automated processes really work on our favor. Instead of mindlessly setting automatic debits from your account: $14.99 here, $29.99 there…they all seem so affordable…compromise with yourself and automate your savings. It won’t hurt I promise.
In regard to investing, it is, now days, very common to be able to do the same process. Do some homework and you will find out you can invest the same way. I learned that it is not about waiting to have a big chunk of money that you will, someday (by magic) have, that then you invest. It is about those small steps you take on a regular basis. What’s your next step?
