Make Life Easier: My Three Money Hacks
A good hack is all about efficiency: hacking a task might accomplish it better, but mostly it’s about making things happen faster and less painfully. Personal finance is full of simple, slow-and-steady tenets to make you secure, stable and maybe even rich, like spend less than you earn and pay yourself first. They require discipline, commitment and an utter disinterest in the Joneses.
Personally, though, I’m more interested in hacking my finances–planning, for me, is about putting in effort at the exact moment where the smallest work will have the greatest payoff, allowing me to be lazy and stay safe and happy.
In the interest of laziness, here are the three things that keep my finances in order and off my mind. They aren’t foundational wisdom, and there are lots of ways to take care of your money–these work for me.
Anticipate. Yeah, y’all, budgeting is my top life-simplifying hack. Sorry, I mean planning–that’s a better word, anyway. Finance is one area in which it’s way, way easier to ask permission than beg forgiveness. At the beginning of each month I open a clean copy of the spreadsheet with my fixed income and expenses, and add in any extra information. This usually takes about twenty seconds (Seriously, how long does it take to click File > Open in Excel?) . Every six months I figure out what major expenses I expect to come up in that time period. Maybe half an hour, and I can do it while I watch a movie.
Aggregate. I use Geezeo, and I like that it’s very simple, but there are a bunch of free account aggregators available online, as well as software you can buy. I don’t know if it’s the best thing for me emotionally to see my student loan balances every time I check my bank balances, but I do know that I like having my credit, checking and savings accounts all in one place. It did take a little while to set up, but now I can check everything at once.
Automate. If you’re not using direct deposit, with automatic 401(k) contributions and automatic savings, and whatever automatic billpay you have available, I assume it’s because one or some of these options are not available to you. It all needs to be checked up on occasionally, of course, because nothing is perfect, but I think these automated systems are way less likely to make an error than I am.
How about you–I know we all have tricks to make us richer, but how do you keep yourself sane while you get there?
Melissa: I was a late adopter and only made the shift to online bill pay in 2006.
My most recent hack has been converting some of my bills to ebills. Countrywide forced me to do this because they established a new policy at one point last year where if you were paying your mortgage via bill pay, they automatically switched you over to the ebill option (they’re know to have a mind of their own — ughh!).
At first I kept wasting time by calling customer service and demanding the paper bill be sent, but sure enough another month would go by and no paper bill. I finally officially selected the option and have been doing it this way now for a couple of months. And with it, I now get an auto-alert when the bill is supposed to arrive in my bill pay account, when it does arrive and finally a reminder when it’s due.
I’ve learned that less paper does save time in managing the entire process.
I use Mint as my financial-aggregator.
I do feel a bit weird with one website having all of my financial info, though.
Thanks for your interest in Geezeo Melissa! We’ve got some exciting stuff in the works as well. We’ll keep you posted no pun intended
I changed the due dates of my credit cards to make them easier for me to deal with, namely, I made them due at the same time so I only have to remember to sit down and pay them once per month. I don’t want them automatically paid because sometimes I need to transfer some money into the account first!
I have a list of all my passwords and stuff and other important notes like “Do not use!” for companies where the automatic or online payment option acts like it works but doesn’t work and then you get to pay a late fee. Actually, my notes say “Don’t fall for this again!”
I budget for some things even though I don’t know how much they are going to cost. For example, I have categories for car repair, house repair, and big fun (vacations, electronics, furniture–anything expensive). If I have the money, I know it’s okay to spend it. If I keep overspending (car repair), I know it’s time to update the budget. I keep track of all this on a spreadsheet.
I made my own checkbook register which looks normal from far away but has separate columns for my checking account and my main two credit cards. That way I can keep track of, and see at a glance, how I’m doing for the month. At the end of the month, I double-check that I’ve paid all my non-automatic bills (gas, utilities, phone, and the two credit cards).
At the beginning of each month, which is when I get paid, I enter all my automatic deductions into my checkbook register, even if they won’t happen for two weeks. I also see how much is on my credit card so far and use that information to calculate how much I can transfer into savings. Then I transfer that money right away. This is also when I update my spreadsheet for my budget, subtracting what I’ve spend for car repairs, etc., and adding my monthly deposit for each category.
I look at my account balances online, not to see how much money I have (because some checks or purchases may not have cleared), but to see if I forgot to write anything down. (I use my checkbook register to see how much money I have.)
That’s all I can think of right now.