Pick One of These 5 Ideas To Automate Your Wealth

Pick Pick One of These 5 Ideas To Automate Your Wealth: At Peace with Money

Last week we talked about loving our future selves, and dove into the world of IRAs. Today, I’d like to share a way you can love yourself and share the wealth with both future and present you – automation! I’ve written about automation before, and why it is so beneficial to our financial lives. The idea is simple: by automating your finances, you reduce your decision making, thereby reducing your chances to change your mind  or forget about saving money or paying a bill in full. Automating your finances make saving money easier and less of a mental effort. This principle is what Steve Jobs and Mark Zuckerberg employ in their wardrobe choices. They’d wear the same thing every day so that they could conserve their brainpower for other more important decisions!

Here are my five ideas you can use to dip your toes into the world of financial automation. Start off slow – just pick one and try it out. If you like your results, you can come back for more!

Automate a Savings Goal

Set up an amount to automatically be sent to a particular savings account for a goal you’re pursuing. Don’t worry about the amount, any amount is great! Simply trying this is the most important step. 

Automate a Bill Payment

Automating a bill payment insures you will not pay late fees. In the long run, this could save you a lot of money. 

Set an Alert

Many banks offer to send alerts when your account hits a minimum balance. Set this up so you don’t overdraw your account. This way, you can avoid those pesky overdraft fees. 

Connect Your Accounts

Connect your accounts to a money management system or app so you can  really see where your money is actually going. I use Mint and I love it! Personal Capital is another I’ve heard of, and many people also swear by YNAB, or You Need a Budget

Set Up Direct Deposit

Have your paycheck automatically deposited into your checking account! This is so much more simple than Pick One of These 5 Ideas to Automate Your Wealth: At Peace With Moneyhaving to take all that time and effort to take your paycheck to the bank. Even if you have your own business and have varying income, you can create a solopreneur paycheck using the Profit First system. If you’re interested in reading more about this, I recommend my posts Create Your Own Paycheck  and How to Pay Yourself First.

If you enjoy these tips and want more resources on automation, I’ll happily recommend The Automatic Millionaire by David Bach. This book emphasizes how savings habits and automation can help you build up savings for retirement. He also has a variety of free resources available for download on his website, so go ahead and take a look at those too! And of course, if any of this has piqued your interest, I’m happy to talk to you about setting up money systems for your business. Take a look at my service packages and schedule a curiosity call!

Angela

Image Source: Rodion Kutsaev

Love Your Future Self

Love Your Future Self: At Peace With Money

One of the best forms of self love is this: put some money away for 65 year old you! Starting an IRA is the perfect way to do this. Beginning to put money away now so that you can take care of yourself in retirement will vastly improve your life as a whole. It’s important to remember your future self, and make sure you aren’t only treating yourself today. What better way to care for yourself?

Give Yourself a Gift

Make contributing to your IRA a fun and regular occasion. Consider it a gift to both your present and future self! Perhaps you could give yourself the gift of a deposit to your IRA for Valentine’s Day. My sister does this for herself on her birthday every year, to celebrate her present and future self! 

Invest!

It’s very important that when you do contribute to your IRA, that you remember to invest it. Don’t simply let it sit in the account in cash.  If you let it sit, it’s not actually accruing any more value, and therefore will not expand beyond the amount you put in. The longer you let it sit, the more time that could be used to expand your investment goes by. 

LOVE YOUR FUTURE SELF: At Peace With MoneyPlay the Long Game

Remember, this is long term money. You won’t touch it for years, so don’t worry about how much your investment increases or decreases in value today.  You are in it for the long haul!

For more  specific info on types of IRAs, here’s the IRS’s info page, plus a helpful article from NerdWallet. I love to talk to people about IRA’s and how setting up Profit First can make saving for retirement more possible, so if you’d like to chat, check out my services page and schedule a curiosity call!

Angela

Image Source:  Ivan Jevtic

Three Steps to Financial Clarity

3 Steps to Financial Clarity: At Peace With Money

As the holidays set in and the mad rush of preparation begins to slow, you might find yourself with a little time to reflect on your year. Why not take the opportunity to reflect on your finances? Your money, much like all the other pieces of your life, deserves your attention, thought, and critical eye. This exercise is meant to lead you to financial clarity. By completing it, you’ll gain a better understanding of what you want from your money, and how to get there.

Step 1: Define Your Destination

What’s your destination with your money? What are you planning to do with it? Is there something you’re saving up for? You might have vague plans, a well-defined roadmap, or nothing at all. This is the step where you can dream and imagine that destination. If you already have one in mind, check in and make sure it’s where you want to go. Make sure you investigate any current money goals you might have to make sure they really align with your desires. If you don’t have any goals, think of some you might like to adopt!

Step 2: Drop Your Pin

Pinpoint your current location. In other words, figure out where you are now financially.  It’s time to get clear and honest about what you have, what you owe and where your money is going each month. Use this step as an opportunity to total up your expenses and debts and track your recent income. Leave no bill unturned! If you want further instructions on this step, I recommend checking out my article on creating a spending plan, specifically the section on analyzing your expenses. 

Step 3: Plan Your Journey

3 Steps to Financial Clarity: At Peace With MoneyNow that you know where you are and where you’re going, it’s time to figure out how you’ll get there. This is the step where strategy comes in. Based on all the information you’ve already looked at during Step 2, you should be able to determine what will help you get to your destination. Whether that’s saving more money, paying yourself first, cutting out certain expenses, increasing your income, or a whole host of other ideas, identify your moves and decide when you’re going to make them. 

This process may take you a little while to complete, but it will ultimately bring you to a place of much greater clarity when it comes to your finances. This exercise can be applied to personal finances but it can also be applied to your business finances. I hope this season of reflection serves you well.

If you need any assistance looking through your finances, I’m happy to help you reach a place of clarity. Schedule a call with me!

Angela

Book Review: Your Money or Your Life

If you’re looking for a full financial makeover, you’ve just found your inspiration. Vicki Robin, co-author of Your Money or Your Life, is also known as the mother of the FI (Financial Independence) life. She is a talented writer and a renaissance woman in her own right. I was interested in reading her book after hearing her podcast interview with Paula Pant. Though the book was originally published in the 90’s, a fully revised edition was released earlier this year.

Favorite Points

This is a great book if you’re looking for a guide to help you really examine your life and your finances. The book includes lots of thought provoking exercises and insights around leading an intentional life and being intentional with your money. It prompts you to go through your beliefs around money with a fine-tooth comb, and includes a lot of advice and guidance for doing so. One such nugget of wisdom is the mantra “no shame, no blame.” Vicki brings this up when asking us to examine our financial pasts. This is very important advice for anyone trying to remake their financial life. We can’t change our financial pasts, but Your Money or Your Life Book Review: At Peace With Moneywe don’t need to stew and feel bad about them. The best thing we can do is move on and take action to enhance our financial futures. This mantra helps us remember that instead of being distracted by our past mistakes, we should look forward and act now. 

Included above is another nugget of wisdom. The chart indicates the sweet spot our finances can allow us to live in without letting our jobs and our need for income control us. This is marked by the top of the chart labeled “enough.” The writers explain that to achieve FI, we need to find our own “enough” zone, a place where our financial needs are sustainable and satisfying. In our culture of material excess, this is a very profound point. This insight alone can easily revolutionize your financial outlook!

I definitely recommend taking a good deal of time to read this book and do the steps. It is chock-full of information. Especially if you’re new to the world of FI, each chapter takes a while to absorb. Don’t let that intimidate you! With serious commitment, this book can change your financial life. If it sounds intriguing, please check it out. I also recommend having a look at the book’s website, it includes a lot of other helpful tools and resources if you want to get started!

Angela

Image Sources: Free in Ten Years, Your Money or Your Life

What’s Your Money Mantra?

What's Your Money Mantra? At Peace With Money

When I see the words “money mantra,” I am instantly a little skeptical.

People often confuse money mantras with affirmations – statements like “money comes easily and abundantly to me.” There is nothing wrong with affirmations, but they are not the same as money mantras.  Affirmations are what you intentionally tell yourself for 5 minutes in the morning as you get ready for your day. You may or may not repeat them for the rest of the day.

In contrast, your money mantra is what your actual belief is throughout the day as you make money and life decisions. Think of it as your guiding principle in financial matters. It is rooted deeply in your belief system and affects all your money decisions, big and small. 

My Money Mantra

I uncovered my mantra almost instantly: “having money in the bank gives me choices.” I think this mantra even helped me come up with my business name; having choices gives me a sense of peace. This statement is a basis for my daily decision making process and in my plans for the future. If I say “no” to one decision I can say “yes” to something else. Being able to choose what to say “yes” to is important to me. I want to able to say “yes” to making charitable donations, to supporting artists, to paying for my daughters college, to my husband retiring early.

DIY Money Mantra

What's Your Money Mantra? At Peace With Money

You can discover your own money mantra by investigating your beliefs around money. Do a little soul searching and ask yourself some questions about your positive and negative thoughts and ideas around finance. This list of 20 questions should help get you started.

This activity can be done solo, or with a money buddy or partner! Once you’ve investigated your beliefs, some positive statements that you can use as your mantra may start to pop up. If you find you don’t have a lot of positive beliefs around money, do some digging to find a mantra that feels true enough for you that you can start operating with it on a daily basis. Incorporate it into your money decisions and see if you can track your progress. Make sure your mantra is guiding you in the financial direction you desire. I desire choices – what do you want from your money?

A money mantra simplifies financial decisions and helps you create a personal financial philosophy. Uncovering one is in itself a helpful process that can help bring financial clarity to your life. Happy soul-searching! May peace be with your money. If you’re finding you need some financial guidance with your business finances, check out my services page or schedule a discover call.

Angela

Image Sources:  Thought Catalog ,  Diego PH

Why Automation Is Your Money’s BFF

Why Automation is Your Money's BFF: At Peace With MoneyAutomation is your money’s best friend. By automating your finances, you reduce your opportunities for decision making, thereby reducing your chances to change your mind about saving money or paying a bill in full. By reducing your decisions you set yourself up for success! Automation can build up your savings and pay off your bills, without any extra effort on your part. So, how can you use automation as a financial tool?

Automate Everything!

There are many different facets of your finances which can benefit from automation. Automating your bills is a good place to start. Many banks have online bill pay options available that help you pay your regular monthly bills on time. In particular, automation is a good way to ensure you always pay your credit card balance in full, so that you don’t accrue any interest fees. However, one important thing to be aware of when automating your bills is that you will need to stay aware of your bank balance, to avoid over-drafting your account. As long as you keep an eye on your balance, automating your bills is a good way to avoid late fees, build good credit, and stay on top of your finances.

The other major arena of your finances that definitely deserves some automation-attention is your savings. I touched briefly on automating your savings in an earlier article, which you can read here. The most important thing about automating your savings is that if money automatically gets moved out of your spending account, you have no chance to spend it. That makes saving that much easier! We do this with our retirement savings, and it really helps us keep it up. A great resource for further information about automating your savings is The Automatic Millionaire by David Bach.

I hope this motivates you to try out automation with your finances!

Angela

Image Sources: Mitch Lensink, Lucas Silva Pinheiro Santos

Young and Thrifty: A Guide to Saving

A Guide to Saving for Young People: At Peace With MoneyRecently I’ve received some questions about financial advice for young people. I think the most important piece of advice I can give is this: save your money. It’s simple, but it can be difficult to get in the saving habit. That’s why I recommend developing a savings plan. There are three parts to a good savings plan: percentage, motivation, and banking.

Savings Percentage

In order to save money, it’s important to decide what portion of your money you want to regularly save. You can decide this in a variety of ways. If you’re in a situation where you don’t need most of your income for fixed expenses, the amount you can save becomes much more flexible. For example, when my younger daughter started working at our local pizza place, she decided she would save her paycheck and spend her tips.

Many sources recommend saving about 10% of your income monthly. If you have a fixed income, this can be calculated easily. With variable income, you can simply tally up what you’ve made and calculate the percentage each month. Use the other 90% of your income to live off of and cover your expenses. 

If you want to make things more  organized or complex, you can work on budgeting out your expenses. I’ll talk about different budgeting strategies in a later post.

Motivation

Having financial goals is important! Make sure you know what you’re saving for. Are you looking to purchase a car? Moving out? A  fund that will enable you to leave your job in case of  sexual harassment or unfair treatment? Having an intention for your savings is important because it helps keep you motivated. The more specific it is, the easier it is to focus on. For example, when my older daughter decided she wanted to take a 3 month road trip, she calculated how much she needed to save, got a job at a shoe store, and the next few months saving almost all of her income. She even lived on her friend’s couch for two months to save on rent. In the end, she saved all the money she needed and then some. That’s the power of motivation! 

Banking

Use a bank that earns you high interest on your savings and doesn’t charge fees. Doing some research to find a good bank will help you figure out where to put your money and watch it grow quickly. You can also read my tips for avoiding bank fees here

Some banks allow you to automatically transfer money to a savings account each month. Setting up that automation can make saving even easier. When you don’t even have to think about it, it’s much more likely to get done. 

A Guide to Saving for Young People: At Peace With MoneySaving is the best piece of financial advice I can give to young people. Getting in the habit of saving your money opens up a lot of choices, something that’s important and helpful in any young person’s life!

This post was written in response to some requests I’ve received for financial advice for young people. To answer these questions, I’ve created a series called Young and Thrifty. Check the tag Young and Thrifty to see other articles in the series. 


Angela

Image Sources: Jeremy Cai,  Sharon McCutcheon

Why You Need a Money Buddy

Why You Need a Money Buddy: At Peace with Money

Who do you go to for financial advice? We don’t talk about money that much in our society, but we should! Talking about our finances, our incomes, and exchanging financial advice can bring in helpful new perspectives to our financial lives. That’s why I believe everyone needs a go-to person for financial advice or perspective.

Not unsurprisingly, I am that person for a few people in my life. When my sister and I were young adults, we had a conversation about what roles or specialties we would take on in our lives. I have always been a “numbers person,” and volunteered myself to be the financial sounding board between the two of us. My sister calls me any time she needs financial advices, another perspective, or an extra set of eyes on her finances.A few weeks ago, she asked me for my advice about buying a new car, which I wrote about here.

Why It’s Important

Having a go-to person for financial advice is crucial for a few reasons. First, using someone else as a sounding board can lend clarity or new ideas to any financial situation. You can also share tools, tips, and ideas with each other. I enjoy talking with other financial coaches about their favorite strategies, and also get some good book recommendations!

Most importantly, having someone you trust to talk about money with can make your finances less intimidating. If you hear about someone else’s financial situation, it can put yours in perspective. Having a “money-buddy” is likely to keep you more accountable to your financial goals and also help you feel more comfortable thinking about money as it becomes a more regular topic of conversation in your life.

Solopreneurs may also appreciate having someone to bounce financial ideas off of, because they can benefit from outside perspectives. When you’re running your business all by yourself, it can be easy to develop financial blind-spots. Having someone to talk to about your business finances can help you avoid that.

Find Your Person

Try approaching a trusted friend or family member with the idea of sharing financial advice with each other. Make sure it’s someone you feel comfortable with so that your conversations are solely helpful. Once you’ve found someone, figure out how you want to structure your financial mentorship. You could review Why You Need a Money Buddy: At Peace With Moneyyour finances together every month, share your financial goals and progress, start a mini financial book club, or simply plan to call on each other when you need to make financial decisions. Keep it as simple or involved as you like.

I hope that finding a go-to person for financial advice will help you make better financial decisions and reach your financial goals. Of course, if you ever need professional help, you know where to find me.


Angela

Image Sources: Thought Catalog, Tyler Nix

How I Broke Up With Wells Fargo (and You Can Too!)

How-To-Break-Up-with-Your-Bank

When my daughter Madeleine learned Wells Fargo planned to charge her increased bank fees and increase her minimum account balance because she was no longer under 18, she decided to switch to a credit union. Below, she outlines the process of research that led her to choose the bank she uses now.

I’d wanted to break up with Wells Fargo for a long time. It was also difficult for me to rest easy while I knew my bank was funding projects like the Dakota Access Pipeline, for-profit prisons, and other tar sands projects.(Here’s their official statement confirming their involvement after the city of Seattle cut ties with the bank for continuing to fund the DAPL project.) If that weren’t enough, the exorbitant fees the bank charges for a variety of reasons led me to decide their convenience factor wasn’t worth it.

Banks and Online Credit Unions

My first thought was to look up the best current banking offers, but most of the options were simply other large banks also involved with the nefarious funding interests I was looking to avoid. Then, I began researching credit unions. Credit unions usually offer higher interest rates and lower fees. They also tend to be more community-oriented and value driven.

So, I decided to join a credit union, but not without a little research. I started by looking up information about the best credit unions. NerdWallet and ValuePenguin both had helpful recommendations, and supermoney was also a helpful resource. Most of these options are national, online credit unions. After reviewing these, I looked up reviews for the ones that fit my criteria. The one I was most interested in was Alliant, but after reading their review, I decided their terrible customer service wouldn’t be worth the hassle. However, I included these resources because you might have different banking needs and be interested in another credit union. I definitely recommend perusing those options.

Local Options

After this dead-end, I decided to look locally. We live in the Bay Area, so I looked up credit unions in the region. I picked out a few different credit unions and looked over the criteria to make sure I’d qualify. Some credit unions require you to live in a very specific area, have a certain type of job, etc. Online credit unions have fewer criteria or easy ways to join without meeting criteria. They’re a good option if you don’t have any local credit unions.

Once I’d found a few options that I would qualify for, I compared their banking offers and looked up reviews. I chose Star One credit union, which offers 1.35% APY on savings accounts (and had some of the best reviews I could find!).

The Switch

The last step was actually making the switch. I went to Wells Fargo and got a cashier’s check from my accounts, and then took it straight to the nearest Star One branch.

On the whole, switching to a credit union was easy. I wish I’d done it a long time ago, because my savings are earning more than 100% of the interest they were at Wells Fargo. Keep that in mind if you’re procrastinating on switching. Your timeline matters!

How to Break Up With Your Bank: At Peace With MoneyFinally, another resource that might help is Magnify Money, recommended on the Stacking Benjamins podcast. I used this tool to look up credit card offers while making the switch. For motivation, this Facebook page, bank transfer day ,encourages you to move your money. I used this tool to look up credit card offers while making the switch. Good luck with your breakup, and happy switching!


Madeleine

Image Sources: Robb Leahy,  Nathan Dumlao