One way to avoid financial disorganization and to make it easier to stick to a budget is to put your finances on autopilot. This will not keep you from buying that extra candy bar at the store, but it will solve many of the problems that arise when you try to manage your budget month after month. Furthermore, an autopilot plan may lower your stress level because you will not be worrying about paying bills manually month after month.
How can you put your finances on autopilot?
You can set up automatic payments for most, if not all, of your monthly bills. You can do this with either a credit or debit card account or by entering your bank account information. Will this solve your budgeting problems completely? No, you will still have to make certain that you have enough money in your bank account to cover the automatic payments. However, you will not have to worry about paying each bill individually, so the process will be much simpler. Furthermore, you will avoid the possibility of late payments, which could affect your credit score and interest rate levels.
Automatic transfer to savings
The other positive aspect of financial autopilot is that it will make it easier to save money consistently. You can set up an automatic transfer from your checking account (where you deposit your paycheck and/or other income) to a savings account each month. This will allow you to save without thinking about it. Ideally, you will be able to establish a savings account that pays interest.
You will know exactly how much you have to spend
As we pointed out earlier, putting your budget on autopilot will not keep you from making that “impulse buy” at the store, but it will let you know exactly how much you have left to spend after bills and savings. You can set your bills to be paid and savings to be transferred a few days after you receive your salary or income payments. You will then know that the rest of the money in your account is for spending for the rest of the month. You will want to make certain that you can cover food and other necessities with this money, but once you have done that, you are free to spend the rest however you want.
What about unforeseen expenses?
You will have a few different options for dealing with unexpected expenses. First, once you start getting more money in your savings account, you could potentially set up a second account that you can use as an emergency fund. You can transfer a portion of your savings money into this second account and then use it in case of emergency.
Another option is to put any extra spending money left over after the month in such a “rainy day” fund.
Finally, you can rely on online personal loans to cover unforeseen expenses. The application process is quick, so you can get approval in a matter of hours and often have your money in one business day or less. You can then add loan repayments to your autopilot budget until the loan is repaid.