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Automate Your Financial Life Like A Boss

Turns caffeine into digestible finance content. You can contribute your thoughts like Ming Feng here.

There are two distinct schools of thought when it comes to managing your financial life.

On one hand, we have the old-school mentality where putting something as important as personal finance on autopilot seems like an irresponsible idea. On the other, a new-age thinking of automating financial life. With each pay cheque, the pie gets broken down into segments and placed into their respective category such as “investment”, “insurance”, “savings”, automatically.

The prior, however, requires a high level of self-control which is rather impossible in the world today. We are constantly bombarded with advertisements on social media and fortunate enough to enjoy the convenience of online shopping. With that, any possible chance of self-discipline on budgeting is now greatly diminished.

Automating our finances, on the other hand, can help create a stress-free, clear-minded environment, which frees us to focus on more meaningful financial decisions.

Here’s how to make it work.

Paying Bills

The thought of having to deal with numerous bills every month manually is just too tiring. It is tedious to keep track of the different deadlines for every bill, which can result in unnecessary late payment fees and interest rate charges if one misses his payment.

These days, one can automatically deduct his bill charges from his bank account with the use of GIRO. Once authorised, GIRO deductions are made automatically at every billing due date.

By paying your bills on time, you are also keeping a good credit score.

Read also: 5 Reasons To Have Good Credit Score

The only drawback for paying your bills automatically is the inability to properly keep track of them. We recommend you hop on a free mobile app such as Seedly, or a manual expense tracking sheet (feel free to copy and paste to use it) to help you do so.

Saving For Rainy Days

It is human nature to go on retail therapy, with the money they have access to.

To tackle this problem, automatically transferring a portion of your pay cheque to an account helps. Set it in a way that it is really inconvenient for you to tap into the funds in that account.

One example will be to leave the debit card of that saving account at home, so that you can only have access to the money in it by transferring funds out of that account manually.

If you are unsure of how much to save, you can take reference from the 50/30/20 rule as shown below.
simple rule of budgeting

Read also: A Couple Can Save An Extra S$120k By Just Following A Simple Budgeting Rule

Investments

Singaporeans are already contributing to their retirement through an “automated” form of contribution to our CPF account. More financial savvy users may look to invest the money in their CPF account to better achieve their retirement goals.

Read also: Investing With Your CPF Savings: A Quick Guide To Get Started

One can also look to Robo-advisors to help them out with their investing journey. Robo-advisors such as Autowealth and Stash Away use algorithms to design a portfolio for individuals, based on individual’s needs and risk profile.

One can also look to set up a Regular Savings Plan to automatically invest in a certain unit trust of blue-chip stocks to yield possible returns.

Read also: Which Regular Savings Plan Is The Cheapest 

Budget

Automating your budget is the most important thing one can do to be on track in terms of financial planning.

In fact, it is proven that getting an insight of your spending habits, helps one save more effectively by 30%. There are currently tools created locally to help one keep track of his expenses. The good news is that one of it, Seedly is available for free with no in-app purchases. Readers can also try out a number of other different apps such as Wally and Spendee.

The worst thing that can happen is that you pick a tool that does not really fit your style and you go on and delete the mobile app for good.

Let Technology Do You The Favour

The best way to manage your financial life is to have a system of good habits that help you grow your savings and wealth with each pay cheque. We have spent enough time earning money, and the last thing we want to do is to spend more time managing it.

If you have more ideas to automate your finances, do reach out to us by commenting on our Facebook!

Be part of our personal finance Facebook Group today! Share your knowledge and learn from the closely-knitted Seedly family as we look to bring each other on a more meaningful personal finance journey.
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