Financial Automation Makes Managing Your Money Easy

Want to be a millionaire? Most millionaires automate their financial lives. Financial automation is like the “Easy Button” to building wealth. You just set it and forget it.

Financial automation lets us regularly pay our monthly bills without lifting a finger. It makes avoiding late fees easy. Many credit card companies, utilities, and banks support auto payment on our monthly bills, which reduces the chances of forgetting to pay a bill.

Here is how it works: we save time and money by using computer systems to handle simple, periodic financial transactions. Once we set it up, the routine runs by itself. Money gets transferred automatically.

It works and helps earn more income.

Here are three great (and easy) ways to automate your financial life.

Three Ways To Automate Your Finances

1: Use Payroll Deductions to Fund Your 401(k)

Your company-sponsored 401(k) is one of the best ways to invest money in your career for retirement.

The most significant advantage of a 401(k) is its tax structure. All 401(k)s are “pre-tax,” which means your taxable income is reduced by the amount of money that you invest into your 401(k). All withdrawals in retirement will be taxed as income.

If you contribute $10,000 to your 401(k), your taxable income will be reduced by $10,000 for that tax year. It’s a great way to invest in your future self and reduce your tax burden.

There are limitations to the 401(k), but it’s still a great way to build wealth, and it’s easy to automate by using payroll deductions by your employer.

How to automate: If your employer offers a 401(k), they probably support automated payroll deductions. Talk to your manager if you need clarification on what your employer offers.

2: Use Bank Transfers To Build Your Emergency Fund

Emergency funds are crucial to building wealth and staying out of debt.

An emergency fund is money set aside and earmarked for an unexpected expense. This is separate money. Savings accounts and CDs are two good options for your emergency fund.

We can use money in an emergency to help live, save our lives, or make our lives just a bit easier when a large bill hits us.

For example, emergency funds are used for situations like:

  • unexpected job losses
  • sudden medical expenses
  • home or car repairs from accidents

Saving three to six months of living expenses is a good goal. If you aren’t there yet (or haven’t started), don’t worry. The key is to begin. Today.

How to automate: Log into your primary bank’s online system. This is the bank account your paycheck gets deposited into. Then, set up an automated monthly transfer to transfer a set amount of money from your primary account into your separate savings account (which could be at another bank).

Transfer an amount that you are comfortable with. If you can only transfer $50 a month, that’s fine. Start there. When you can, increase the amount to build your emergency fund quicker.

3: Use Bill Pay To Pay Your Credit Card Bills To Avoid Interest

Most credit card and utility companies offer “Auto Bill Pay” to customers to automatically pay monthly bills. This eliminates the need to write checks or pay manually.

I am a big fan of auto bill pay because I don’t need to spend time paying bills every month. It just happens. Set it up once and forget about it.

Typical bills to pay automatically include:

  • Mortgage/rent
  • Credit cards
  • Utilities
  • Cell phones
  • Auto loans
  • Student loans

How to automate: Take a look at the online systems for your regular monthly bills (credit cards, utilities, etc.) to set up auto-pay. Your bill will be automatically drafted from your account at regular intervals. This way, you will never miss a payment and incur late fees.

Call them if the company doesn’t have an online system or you can’t find it. A few minutes on the phone is worth saving time every month paying bills.

One caveat: It’s always a good money management practice to check your bill. Don’t assume your charges are correct. Companies always make mistakes, so never let auto bill pay prevent you from confirming that you aren’t being overcharged. Always take the time to check your bills.

In addition, make sure you have enough money in your bank account to pay your bills. Auto bill pay could make it more likely to overdraft your account if you don’t have enough money. Be diligent in ensuring you always have enough money to pay your bills.

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This article was produced and syndicated by Wealth of Geeks.


Steve Adcock is an early retiree who writes about mental toughness, financial independence and how to get the most out of your life and career. As a regular contributor to The Ladders, CBS MarketWatch and CNBC, Adcock maintains a rare and exclusive voice as a career expert, consistently offering actionable counseling to thousands of readers who want to level-up their lives, careers, and freedom. Adcock's main areas of coverage include money, personal finance, lifestyle, and digital nomad advice. Steve lives in a 100% off-grid solar home in the middle of the Arizona desert and writes on his own website at SteveAdcock.us.