Simplify & Automate Your Finances

We have a habit of making our lives more complicated than they need to be. This includes our finances. The more I write the more I see how easy it can be to fall into the trap of complexity. This is especially true – although not always obvious – when it comes to our finances.

The following is a list of simple things you can do to simplify and automate your finances.

• Reduce the number of credit cards you have down to as a few as possible. Ideally, your goal should be zero credit cards but if this isn't an option try to get to just have one credit card (If you own a business make sure you have a separate credit card for the business that you are not using for personal expenses.) The advantage of having either zero or one credit card is you can track your spending.
• If you are using a credit card be sure to set up alerts in your account (either push or email) to notify you of any spending over $1 on your account. This will prevent any fraudulent spending and help you keep a good handle on what you are spending money on!
• Setup an automatic full balance payment of your credit card from your bank so that your credit card is paid off in full each and every month in order to avoid any fees or penalty charges.
• Move any cash sitting in a core cash account into a money market account for a greater interest rate return.
• Stop all paper statements and set up email or digital statements for everything. In today's age, there is no reason to receive paper statements when everything you need is online!
• Setup automatic payments for all of your bills so that nothing gets overlooked!
• Create a budget to track all of your spending! Once you have a budget in place set a calendar reminder for the 1st of each month to take 20 minutes to review your budget.
• After a few months of budgeting take the time to go through each line item of your budget and either reduce or eliminate any additional services you are not using. The most common are subscriptions that often go unused.
• Use just one bank for your checking and savings account needs.
• Use just one brokerage account for your retirement accounts and investing. Note: Most brokerage accounts such as Fidelity and Schwab can also handle all of your banking needs but there are certainly times when you might also want a local bank as was referenced in the previous item.
• If possible, have all of your insurance policies with one reputable insurance company. Stop for a second and consider all of the insurance policies that you likely currently have in places. Examples include car insurance, home or renters insurance, jewelry insurance, identity theft insurance, long term care insurance, health insurance, life insurance & this list could go on! It is unlikely that one company covers all of this (for example health, long term care, and life insurance are often separate insurance carriers) but it is important to check since some companies will offer a discount when you combine coverages. For example, we use USAA for most of our insurance needs but our health and life insurance are elsewhere.
• Set a schedule to check your credit report once every 4 months by rotating between the three major credit reporting agencies (Experian, Equifax, and Transunion) each time.
• Have an estate plan in place.