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January 15, 2014

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I've just stumbled upon this - I think I have some catching up to do reading 1-27!!

I completely agree on these three points. I only started tracking my spending and net wealth in minute detail in the past few years and I don't think its a coincidence that my net wealth has increased by 50-100% each year compared to much lower figures in years before that.

The advice about not setting it and forgetting it is very true.
Beginning of last year I had automated everything, including large extra payment on the mortgage and transfers to saving account. Suddenly 2-3 months in the year I realized my checking account is running on fumes. I hadn't accounted for the fact that early in the year my salary is a bit smaller due to social security payments, also I had moved from regular to Roth 401k, etc - and on the expense side my toddler started day care, which or some reason was not in my budget estimates. So a net difference of over $1K a month almost put us in the red until I noticed what is happening.
And on a smaller scale this month I noticed the trash service hadn't made their quarterly charge (all our bills are automated). I called them and it turned out that when I automated 2 years ago I put a limit on the charge which was sufficient at the time but was just exceeded. If I hadn't called to check and correct they would have been after me for late payment.
I find automation extremely helpful, when I am not asleep at the wheel :-)

I find that the Bill Pay system available on my Credit Union account makes it very easy for me to manage my payments. I take care of our credit card and utility bill payments by scheduling them for payment on the day preceding their due date. This way I hardly ever need to mail anything, have never had a late payment, and maximize the balances in our checking and savings accounts. Now that I am 79 I also don't rely on my memory as much as I used to and use a desk calendar to jot down when payments are to be made and also when money needs to be transferred from Savings into Checking.

Another great advantage of my credit union is that they never charge me any fees whatsoever and their interest is higher than I can get at a bank. Another big plus for credit unions is that when I need some cash I don't have to drive to my own credit union to use an ATM since many of them are networked such that you can use whichever credit union happens to be closest to you. You can also use ATMs at 7-11 stores but the login process is not as easy to use.

All 3 tips are great, but I especially love automating. I recently even started automating my giving. I can give my tithe to my church online and it allows me to set an amount that comes out every month. Even if your church or charity doesn't have an online payment option, you can still set it up with online banking. Automation makes everything easier. I actually just finished writing an article, that I plan to post next week, on having an automatic budget. Thanks for the post!

A very good list that will help anyone who wants to be able to manage and secure their finances. Commitment is the key and the continuous and innovative effort to find ways to make every step work for your unique needs.

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