Automate Your Finances For Financial Independence

today I want to talk to you about a financial game changer and that's automating all of your finances I'm gonna show you how you can set up automation with your different accounts as well as how it can even save you some interest on your debts and other bills automation will help get you ahead as far as your net worth is concerned it will relieve stress it will help get you outside of the spreadsheet and really relieve some stress when it comes to finances and make things a little bit better for you so that you don't have to stress out about it it's just I'm telling you stick around this video will help you tremendously if you are new here my name is Brad I make videos with tips and motivation on how to get out of debt save money invest for retirement all in the hopes that we can all reach financial independence I recently got turned on to the benefits of automation after a reading or meet Sadie's book I will teach you to be rich if you haven't read that book I did a review on it I'll leave the link down below highly recommend it but one of the biggest takeaways I got from that video was the power of automation I was already automatically paying for bills and things like that but I didn't look at the other side of the picture I didn't realize how automating my savings and my investments would really help my net worth and take the pressure of personal finance off my shoulders so let's jump right into it and start with where automation begins automation is going to begin with your checking account consider your checking account your inbox all the money that you make from all of your different revenue streams whatever that is that money is all going to come into your inbox your checking account and their then from there we are gonna send money to different places automatically at certain times of the month that fit our payment schedule now one thing about the checking account and making all these automations and one thing that my wife and I have really started to do which it makes things absolutely incredible you must be paying your bills with last month's money what I mean is on the first of the month all my bills are paid they are gone and the money that I used to do that is from last month I do not think about my future paychecks and my future income and how those are gonna pay this month's bills the money that I make in this month is really going be the money that I use next and this protects you against certain things like your your pay goes up or down or you have to take some time off of work and what this does is it really allows my wife and I to sit down and talk about our financial picture pretty much once a month on the last day of the month we sit down we look at our bills we make our budget and we know how much money we are going to need to spend to pay off all of our bills for that month then we make sure that amount of money is in our checking account if we have to move some money from savings that's okay but we know that on the first of the month all our bills are going to be paid automatically and then any money that we make after that will be used next month so I really really highly recommend try and make that happen it might take a couple months so you save up 1 months of expenses into your checking account but I'm telling you knowing that all your bills are paid on the first of the month and that you don't have to worry about your income makes your life a lot easier the first thing that you're gonna want to automate is your bills and your other debts maybe your student loan payments and things like that and this is common for a lot of people but a lot of people don't realize that oftentimes if you use automatic payments you can get your interest lowered on a few things I know my mortgage went down by 0.25 percent because I was able to automatically pay my mortgage payments as well as my student loan payment with sofa when I set up automatic payments with them they lowered my interest rate so if you don't have automatic payments with some of those bills right there might be a major benefit to you but on the first a month all of my major fixed costs come out my mortgage daycare utilities cell phone internet everything is paid on the first of the month with last month's income it's such an amazing peace of mind to know that after the first of the month you have to worry about paying bills again for the rest of the month it really is nice I used to add my bills set up so they were all over the mont it all you have to do is go into your different payments and you can make your payment dates I make them all the first of the month now it might take one billing cycle for everything to adjust with the different companies that you have but literally everything I have comes out on the first of the month the only thing that I don't have come out automatically on the first of the month are my groceries cuz that changes the gas that I pay and other unexpected expenses like oh my gosh I have to get some diapers or other household items that I might need but all of these payments are going on to my credit card which is automatically paid now I know I need to take a second and talk about credit cards so we'll start there my wife and I we use credit cards in a responsible way we use them for everyday purchases we don't use them for outside things we never hold a balance we never give the bank interest and that works for us I understand some people they hate credit cards it's not for them we know how to use them and we benefit greatly from reward points so we're gonna continue to do so but not many people know that you can automatically pay your balance in full whenever you would like and this really helps keep your discipline and keeps you from avoiding paying interest now other bills and stuff they're gonna help you automate their payments because they want the payments but credit cards they're not going to come out and tell you that you can automatically pay your statement in full why because they don't want you to do that they want you to pay the minimums so that you can keep paying them interest but you can beat the bank's at their own game you can use credit cards responsibly and then pay them in full never pay any interest and reap all the rewards that you can accumulate through those payments my credit card gets automatically paid on the 2nd of every month and here's how you can set up an automatic payment for your credit card right now I have a chief sapphire rewards card when I click on that card in my Chase account to the right you will see automatic payments and there will be a details and it will say on or off if you click on it will send you through the steps to set up your automatic payments they're gonna ask you where do you want to make the payment from this is gonna come from your inbox your checking account for me I have a chase checking account so it makes life really easy but if you had a checking account with another bank and your credit card was in the different Bank you could set those two accounts up to talk to one another and transfer money from one checking account right here to your credit card they're gonna ask you when do you want to make this payment now for me I just make it on my statement date as soon as they generate a statement for me I pay it off that day no biggie maybe you want yours on the 14th of the month 18th of the month that's really that's up to you you get to select this date and they're also gonna ask how much do you want to pay and this is the game changer you really need to put statement balance you need to pay that thing in fall every single time automatically you don't have to worry about forgetting to make a payment it's done for you think of the stress that comes off on just knowing that you're never gonna give the bank interest and you're just taking award points from them and every single time you make an automatic payment the big boss is over a chase their hair just they just they hate it so much but you are win it and one question I get asked a lot about the credit cards and the automatic payment says can you make additional payments yes sometimes something comes up oh crap we need diapers I put that on the card but because it wasn't part of my budgeted amount I will pay that that day right away so then the second of the month when my bills come out for the credit card I know exactly how much I'm gonna be putting on my credit card because they were all budgeted items i budgeted my groceries I budgeted my gas I budgeted my household supplies so there's no surprises so if I make a purchase outside of those budget items yeah I go in that day and I paid off immediately the next automatic payment which pretty much comes out for us every paycheck is gonna be into your employee 401k for 3 P 457 HSA flex account one of those accounts if you have that option that's going to be the next automated thing you're gonna do and that's really the first automation to your financial success that's the first thing that you are going to do that's going to help you build your net worth exponentially and over time you won't even realize that that money was there and the accounts will just start to grow and to grow to do this all you have to do is reach out to payroll they're gonna give you a form called an S are a salary reduction agreement and you are gonna choose either an amount that you want to put in per paycheck or a percentage of your salary that's really up to you then when you get your pay stub it's going to tell you how much money you've contributed that year and the beautiful thing is take that number multiply it by 0.25 that's how much money you have saved in taxes that year by contributing to these tax deferred account just one of my favorite things to do every time I see my pay stub I go right to my contributions to my 403 B and my 457 I'm old to apply it by 0.25 and I think to myself suck at IRS you're not getting that money from me the next automatic payment that I make is into my high interest savings account with Capital One formerly the money market account but you saw I just made a video they have switched to 360 Performance Capital One makes it incredibly easy to set up automatic payments into these accounts these are going to be things like your sinking funds these are going to be things like your emergency fund or for me now my down payment for my real estate investments this is where the money is gonna go for your savings it's going to get 1.9 percent if you don't have a high interest savings account and you're using a big bank you really shooting yourself in the foot you do not need to use Capital One there are many different options watch the video and you'll see why I love them so much but really get yourself into a high interest savings account for Capital One all you got to do is log in you're then gonna click view account to the left side you'll see something that says transfer money and once again it's gonna ask you where you want that to come mine comes right from my Chase they're gonna ask you where you want it to go to you want to go to one of your savings accounts if you have multiple Capital One accounts you can send them into different sinking funds I know many people and have many different accounts here's a beautiful thing you set up frequency so you set this up every month every two weeks every week whatever you want and it's gonna automatically pull it and you know that you are gonna be putting money into your savings account whatever frequency you want then after you set that up the beautiful thing once again is right at the top of the screen it's going to show you all of your automatic transfers so you can manage them you could delete one you can edit one they make it so user-friendly highly recommend start setting up your automatic savings with your high interest savings account and my last automated transfer comes on the 4th of every month and that is into my Roth IRA to do this you're gonna have to log in to Vanguard or whatever company you have your Roth IRA with I just made a video about how to open a Vanguard account and how to open a Vanguard Roth IRA I'll link that down in the description in the comments below if you need to check that out so you can open account but what you're gonna do is first you're gonna log in to your account then you're going to click the link for your actual Roth IRA now in Vanguard when you're actually in your Roth Raye all the way to the right side of the screen you're gonna see more account information when you click over more account information you're gonna see set up a schedule transaction click that automatic transaction and here you are you could set this up now one thing I will tell you about this remember when you set up a Roth IRA you're gonna have some sort of settlement account and then you have your different investments when you set up your automatic payments you can choose one or the other but if you set up your automatic payments to your settlement account remember those are not invested into your funds you will have to go in and put them into your funds some people might want to do that if they're saving up a certain amount that has a minimum on a mutual fund they want or some people are using their settlement account as their high interest savings account that's really up to you me personally I go right from my checking account right into VT sa X all day first of the month my Roth IRA will be fully funded this year and every single year after that and frankly that's it it's the fifth of the month all my bills are paid my credit cards paid my savings account is funded my Roth IRA is funded my 403 B is funded my foot I didn't have to do anything and now all I need to do is stay disciplined for the rest of the month at the end of this month my wife and I will have one budget I won't have to look at my investments every month as the markets up or down I do not need to do that anymore I live outside the spreadsheet a weight has been lifted off my shoulders I know that I am okay financially and you can be to leave down in the comments what things do you have automated and what things are you gonna go automate now after watching this video until I see on the next one guys stay positive work really really hard always please be kind to other people I hope you have yourself an amazing day and an even better tomorrow [Music] [Music] [Music]

Channel: Brad Finn

Views: 3,312

Rating: 4.9775281 out of 5

Keywords: automate your money, automate your finances, automate your savings, automate your investments, financial independence, how to automate your savings, financial independence retire early, personal finance, automate your personal finances, ways to automate your money, automate your life, automate finances, automate your accounts, automation, automate financial accounts, automate your finance, how to automate your finances, ramit sethi, brad finn

Id: u1KmGlLECOg

Length: 13min 10sec (790 seconds)

Published: Sun Oct 06 2019