I used to keep my bike in my garage, and I never rode it. Now my bike is in my living room. It was (more appropriately) in my hallway, but I moved it in case that was one of the reasons Pepe was jittery about using the litter box, which is at the end of the hallway. Now I ride it all the time. Because it’s right there, and it’s easy.
I’ve been talking about wanting to do more yoga for a long time, but my frugal arse doesn’t like the $15-$20 price tag of one class. Now that I have vinyl floors, my apartment looks more yoga-studio-y, but I had a hard time finding a place for the mat. Solution? I moved the area rug under the couch more, to leave more space so I can either watch yoga on a streaming channel or on Youtube…for free! It’s not as pretty as more area rug covering the floor, but to do more yoga I have to make it easy for myself.
I think that’s how any good habits are created. You make it easy.
Related Reading: A Quest for a Slow & Simple Life
That’s my goal with my finances too. I have (what feels like) 10 million decisions to make each week, so the more I can set things up to run behind the scenes, the better my financial life will be, inching me closer each day to financial independence.
Setting up a 401k with my company was a no-brainer. In fact, I was super stoked to be going back to full time in big part because of a 401k plan. You see left up to my own devices, I may never remember to go into my accounts and manually transfer money.
Plus, two words: Company matching. If you are not doing that (why aren’t you?!?!?), you are missing out on FREE money!
I started off with a 5% contribution (I wanted to build up some cash reserve), but have slowly inched my way upwards, where I’m currently at 13%.
Capital One 360
I still have this account from before I started working full time, mainly because of the various savings buckets I can create. I also automate monthly transfers into three buckets:
- Car Insurance (I pay once per year)
- Sh*t is Getting Old Fund, or what I like to call my Pre-mergency Fund
Ally is an online bank, which gets about 1% interest. This is where I keep my main emergency fund (currently at 16k). I’m toying with the idea of dropping this account and just going with one online bank to make it more streamlined.
I also make monthly automated contributions to my Vanguard brokerage account. Right now it’s automatically transferring out of my checking account, but I might change this to auto deduct from my paycheck before it even hits my checking account. Like many PF people, I invest my money in low-cost index funds, as I’m no Warren Buffett, and neither are you. 🙂
Also once a year I do manually transfer money to max out my Roth IRA.
Digit pulls small amounts of money (based on spending/saving algorithms) at random times into a separate account, which you can control with very simple texting. I LOVE this app and I highly encourage everyone to try it. Digit is free too!
I aggregate all my accounts through Personal Capital, so I can keep track of all my assets and liabilities. I can also track my expenses. As many personal finance bloggers can attest, PC is a great, and free tool to keep track of all your money.
This is where I differ from a lot of savvy PF people. Many use credit cards for travel rewards, and I have too, and I’m a very responsible credit card user, but I hate the task of keeping track of how much I spend (to maximize bonus points), and/or keeping track of dates opened to avoid an annual fee.
I know many people who keep spreadsheets to keep this stuff organized, but my right-brained mind detests keeping track of just one more spreadsheet. It’s not off the table forever, but it is for now. I pretty much use one credit card for purchases (my Southwest card). At least I can fly free around the US.
Related Reading: Vegas & Utah on a Budget
Speaking of spreadsheets, the only time I use one is for budgeting. And it’s very simple, clean, and easy-to-use.
I’ve tried YNAB and other fancy apps and websites, but I always come back to my simple spreadsheet.
Related Reading: The 5 Elements of a Successful Budget
This is where I, quite frankly, suck at keeping things simple. Even though I have less to keep track of or organize for my accountant now that I’m full time, I still feel disorganized about keeping good records for taxes. Do you think I need to get something like Quicken or some other kind of program?
I think the biggest thing that makes my financial life easier and effective is this: AUTOMATE! I’m not the first and I won’t be the last person to say that.
While there might be a tiny bit of pain not seeing money in your main checking or savings account each month, what is freaking awesome is watching your net worth increase month over month, without having to “do” much.
Humans are highly adaptive creatures, so you get used to having “less.” It takes the temptation to spend away when you know it’s not as easily accessible.
Does your financial life look similar? More complicated or easier? What can I do to streamline even more? Any other financial apps or programs you can’t live without?
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