Is automating savings a good strategy?

Question

Has anyone implemented an automation system for their savings? Is it really effective?

Answer 1

Setting up an automatic transfer from checking to saving on a monthly basis is crucial since it guarantees savings in the first place. It goes without saying, having savings out of sight will reduce the temptation to spend it, which in turn helps in accumulating wealth over some time.

Comments

I used to live paycheck to paycheck 5 years ago, but when I discovered FI. I pay myself first, budget, build up my emergency fund and paid off all my debts. Just like all the financial channels suggested you to do. That is what I've been doing, I was able to save my first $100k in the last 5 years with $65k/year salary doing those steps. I wish I know how to pay myself first when I was in my 20s or 30s. I also make my own coffee every morning and also, I get free coffee at work. Also, I haven't buy clothe in the last 4 years when I discovered simplicity and that saved me a lot of money as well. No debt and not living paycheck to paycheck is the most glorious feeling. Everyone should stay away from debt, you can't save if you have bunch of debts that is just the facts. I feel so fortunate I am now able to have control of my life again. Just wanted to share and hope to motivate at lease one person.

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This “pay yourself first” was a big change for me. It was just another “bill” that I had to pay. It took no willpower. Another great content Nicole. Thank you.

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I call "automate your savings" "pay yourself first" the difference is the money goes to the investing/brokerage account and then to purchase etf's every other month. Invisalign is a very big deal. You go girl. Regarding the DIY be careful about what you do as you don't want to void your house insurance.

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I have a sort of unbreakable piggy bank i bought for like 12 bucks ( you basically need a good strong hammer to open it) and ive been dropping paper money in it every chance i get. I plan to open it once its filled to the max in about a year or 2. I recomend it for those who need another alternative to saving.

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Nicole is most on point with her money-saving content tips regarding spending; automating your savings is critical. The only thing I will add is to be very wary of pair bonding with anyone with a different philosophy on money than you. It's a great way to lose everything you have earned especially if you are a guy. Everything women have accomplished in the work world and with modern feminism and independence will be of no help if you pick the wrong person, even if only on the money thing. Enough said.

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Sinking funds for annual taxes ($750/mo) is essential for me. Set the dollars aside now or stress later. I also pay off any credit card expenditures at the end of the month in which they’re accrued. It helps keep things real.

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I have an automatic transfer to a higher interest savings account each payday - it seems to be working well for me so far

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I’m in between jobs right now. I’m going to call my bank to make sure I don’t get charged those pesky fees since I have no direct deposit. Thanks for the reminder.