Speaker 1: Welcome to How the Money. I'm Joel and I and
Speaker 1: Matt and today we're discussing automating your finances for the win. Automation, man,
Speaker 1: that's what we're talking about today. We're talking about how
Speaker 1: you can automate your money. But there are some downsides
Speaker 1: to that. There's obviously some benefits, but if you don't
Speaker 1: do it the right way, there's gonna be some downside.
Speaker 1: So we're gonna talk about how you can automate your
Speaker 1: money the right way. You don't want to automate improperly, man,
Speaker 1: that would be a bad movie. Yeah, but you you
Speaker 1: do want to automate to at least a certain extent
Speaker 1: because it's gonna help your finances out in the long run.
Speaker 1: I want to say we recently talked about gamification and
Speaker 1: gamification and automation. It sounds like maybe they're a little similar,
Speaker 1: but there are some big differences, right, Like, Gamification is
Speaker 1: one thing. It's about making personal finance a little more fun,
Speaker 1: treating it a little more game like in order to
Speaker 1: get ahead. Automation is kind of the steps that you
Speaker 1: take in order to get yourself out of the way
Speaker 1: so that you have to make fewer decisions. And you
Speaker 1: can still set yourself up for financial success and make
Speaker 1: it automatic. It's like a little it's like your thermostat
Speaker 1: and you set out on auto. I don't go in
Speaker 1: there and change it. It does the work for me.
Speaker 1: I just know I wanted at a certain temperature. Yeah, yeah, exactly, Matt.
Speaker 1: Before we get to that topic, though, I wanted to
Speaker 1: get your opinion as a professional photographer. What's this note
Speaker 1: on here about like d I Y engagement shoot? So
Speaker 1: my friend Faith recently posted she got engaged, So congrats
Speaker 1: to Faith. Oh is this a business opportunity? I'm going
Speaker 1: to put that to you right here on the air.
Speaker 1: Would you like to shoot her wedding? And will you
Speaker 1: give her a discount? Thanks buddy. So I don't think
Speaker 1: she's gonna hire you man, based on what she's done already.
Speaker 1: So she posted photos of her fiance and her on
Speaker 1: her Instagram the other day and she said that they
Speaker 1: did a d I Y engagement shoot session. So they
Speaker 1: set up her smartphone on a tripod, they pressed the
Speaker 1: button ten seconds and then you know, they pose and
Speaker 1: they take the picture and the pictures turned out pretty good.
Speaker 1: So I just kind of wanted to get your take
Speaker 1: on whether people should be doing their own engagement photo shoots.
Speaker 1: What are your thoughts on that? First, Yeah, you probably
Speaker 1: think it's a great idea because you see that as
Speaker 1: a way to save money, right. I do think it's
Speaker 1: a great idea. I think it's a great idea. And
Speaker 1: I will say, when Emily and I got married got engaged,
Speaker 1: my friend Tim's a photographer and I like him so
Speaker 1: much more than you, and that's why I had him
Speaker 1: take the pictures. Now, I'm just kidding. We we didn't
Speaker 1: really know each other about We didn't know each other
Speaker 1: at all, so but I know Tim and we've worked together,
Speaker 1: and Tim took a great some great engagement pictures for us,
Speaker 1: and because he's a friend, you know, it was all
Speaker 1: kind of included in this package whatever. But I think
Speaker 1: if you're shopping him out separately, an engagement session can
Speaker 1: cost hundreds of dollars and I think to be exact, okay,
Speaker 1: at least for me, good to know. And yeah, if
Speaker 1: someone wants to say five bucks by doing it themselves,
Speaker 1: I mean, really, when I look back, I'm really glad
Speaker 1: that we paid good money for professional pictures for our wedding,
Speaker 1: But then engagement photo session those pictures just don't hold
Speaker 1: quite the same sentimental value to me. So I think
Speaker 1: it would have been okay just d I ying that
Speaker 1: and saving money. Like, I think that's a decent move
Speaker 1: for a lot of people to consider. So I will
Speaker 1: agree with you if you're somebody and you know that
Speaker 1: you just have a certain application of mind, right, Like
Speaker 1: if you know you just want a couple of solid
Speaker 1: shots for your wedding website, because of course you need
Speaker 1: you want to have some cute pictures of yourselves where
Speaker 1: you're not like at a brewery. Yeah, that's my life
Speaker 1: at least. So if you if you have the end
Speaker 1: in mind and you know that you just want a
Speaker 1: few shots, then I think that's perfectly fine. Here is
Speaker 1: the argument, you know, and this is me representing the
Speaker 1: wedding photography industry a little bit, but a lot of times,
Speaker 1: what you're doing when you have an engagement session is
Speaker 1: that you're actually practicing having your photos taken. So most
Speaker 1: people they're not used to having their pictures taken professionally,
Speaker 1: and so when you have an engagement shoot, you're basically
Speaker 1: getting a feel for what it's like being in front
Speaker 1: of the camera, and that's really important. Because if you
Speaker 1: have that out of the way, then on the wedding
Speaker 1: day you can be yourself and you're relaxed and you're
Speaker 1: having fun, and then the photographer can take really good pictures.
Speaker 1: So that's the reason. I mean, that's an argument for it. Personally,
Speaker 1: Like I don't ever try to upsell any of my
Speaker 1: clients to get engagement photos done because I make less
Speaker 1: because like you know, yeah it's five bucks, but even still,
Speaker 1: when you take into account all the time that goes
Speaker 1: into it, like emailing back and forth about outfits, locations,
Speaker 1: the time it takes to shoot, the time it takes
Speaker 1: to edit, there's still some bare minimums that you that
Speaker 1: you have to do whether you're shooting for seven hours
Speaker 1: or whether you're shooting just for an hour two hours
Speaker 1: for an engagement shoot, and I actually make significantly less
Speaker 1: on my engagement is hourly rate is way less on
Speaker 1: engagement sessions, and so I don't try to upsell my
Speaker 1: clients at all, but obviously if they're you know, they
Speaker 1: show any interest in that, I'm more than happy to
Speaker 1: do that because it's a great way for us to
Speaker 1: get to know each other prior to the wedding. So
Speaker 1: if you know, you just want a couple of great
Speaker 1: shots for something specific, like like a site or maybe
Speaker 1: for a save of the day. I think it's great.
Speaker 1: I think what it comes down to is that engagement
Speaker 1: shoots have become kind of this normal thing, and I
Speaker 1: don't know that they were normal back in the day.
Speaker 1: I don't think they were. I think they've kind of
Speaker 1: become normal, and I think it's important for all of
Speaker 1: us to question would have become quote unquote normal expenses
Speaker 1: things that everyone around he does without thinking about it. Well,
Speaker 1: you know what, it's stuff that we can think about
Speaker 1: and we can make a different decision. And the things
Speaker 1: that everyone around us is doing, we don't have to
Speaker 1: take the bait. We don't have to go in that direction.
Speaker 1: It was refreshing, I think to see her post, to
Speaker 1: see that they took these cute pictures on their own
Speaker 1: and it didn't have to be this big thing and
Speaker 1: it didn't have to cost five bucks. And you know what.
Speaker 1: The interesting thing too, the stats bear out that people
Speaker 1: that spend less on their wedding actually typically stay together longer.
Speaker 1: So sometimes the more you spend, the bigger a production
Speaker 1: your wedding is, the more likely the relationship is to suffer.
Speaker 1: So I don't know what that says about people, but
Speaker 1: I think questioning these normal expenses, making sure that we're
Speaker 1: kind of marching to our own beat and not just
Speaker 1: going in the direction that most of society is going,
Speaker 1: I think that's just that's just a good thing to
Speaker 1: think about, right, It's always good to not be a
Speaker 1: mindless drone. So, and I will say too, if you
Speaker 1: don't have a professional engagement shoot, you can still have
Speaker 1: amazing wedding photos. Like I'm not saying that you must
Speaker 1: do that in order to have amazing, true, honest, emotion
Speaker 1: filled wedding photos, but it does help a little bit.
Speaker 1: So all right, I'm on the fence there because I can.
Speaker 1: I'm totally with you from on like the frugal, you know,
Speaker 1: cost saving standpoint, because that's totally something that Kate and
Speaker 1: I did but way back in the day as well.
Speaker 1: But then obviously on my side of it, as a
Speaker 1: professional photographer, I see that side of it as well.
Speaker 1: So yeah, all right, well I had to get your
Speaker 1: little torn here and had to get your opinion on it.
Speaker 1: All right, let's mention the beer we're having on the
Speaker 1: show today, Matt. Today we're drinking a Legion day Glow
Speaker 1: I p A and this was generously donated to us
Speaker 1: by listener Joe Man. First off, I'll say this is
Speaker 1: one rad can and look forward to sharing this one
Speaker 1: with you, and we'll talk about it at the end
Speaker 1: of this episode. But let's go ahead and get to
Speaker 1: the topic at hand. I beat you to your line,
Speaker 1: automating your finances for the win. Let's talk about it, Matt,
Speaker 1: all right. And when I first started thinking about this topic,
Speaker 1: I've really excited to tackle it. It made me think
Speaker 1: of Henry Ford and he started manufacturing cars at a
Speaker 1: rapid pace because he pretty much invented the assembly line,
Speaker 1: and that completely changed the game when it came to
Speaker 1: car manufacturing. Before he did that, it took twelve hours
Speaker 1: to make a car and afterwards just two and a half.
Speaker 1: And now our good pal Elon musk Man, he's changing
Speaker 1: the game even more. Yeah, first name based friends, Yeah,
Speaker 1: his first name, that's what I call him, right of course.
Speaker 1: And he's nearing his goal of a fully autonomated assembly
Speaker 1: line process. I think on the Model three, the assembly
Speaker 1: line is completely automated, no humans involved in the process
Speaker 1: of creating the car at all. That is actually pretty awesome. Yeah,
Speaker 1: and it's gonna be interesting to see how that continues
Speaker 1: to progress. But automation can aid speed, it can lower costs,
Speaker 1: and it can create more reliable systems in general, So
Speaker 1: automating your finances can have a similar effect. Getting good
Speaker 1: at handling your money won't magically happen. You have to
Speaker 1: take action and repeatedly making smart money moves. Well, that's
Speaker 1: kind of hard for all of us. It's easy for
Speaker 1: us to forget or just get playing lazy when it
Speaker 1: comes to doing the right thing with our funds. And
Speaker 1: that's really where automation comes in, right man. I mean
Speaker 1: it helps us to engineer money success instead of just
Speaker 1: kind of hoping and praying that will happen to us
Speaker 1: or that will continually be able to muster the willpower
Speaker 1: to make it happen on our own. Yeah. Well, you
Speaker 1: know you said engineering, and that I think that's the
Speaker 1: perfect term, right, because what we're doing is we're planning,
Speaker 1: we're creating, and we're like managing these money systems, and
Speaker 1: that's part of what automation is all about. But the
Speaker 1: reason for automation and the reason that it's so helpful
Speaker 1: is because we live ever increasingly busy in complex lives, right,
Speaker 1: and our money. It's no different between the different bank
Speaker 1: accounts that we have, multiple credit cards, the different debt
Speaker 1: obligations we have, and even just new payment platforms I'm
Speaker 1: thinking of like Venmo and cash app, just keeping up
Speaker 1: with your money and there as well, and who owes
Speaker 1: you what for what drinks and what restaurant? Right, all
Speaker 1: these things combined, it can be difficult for us to
Speaker 1: take action on a consistent basis that will have a
Speaker 1: long lasting effect on our personal finances. And the keyword
Speaker 1: here is consistent, right, Because at the beginning of the year,
Speaker 1: with the different resolutions we've made, it might be a
Speaker 1: bit easier to stock away a little more money towards
Speaker 1: our savings, towards investing. But guess what, come April or May,
Speaker 1: a lot of us have lost that enthusiasm and so
Speaker 1: that consistent action has gone out the window. Automation it's
Speaker 1: majorly helpful when we lack that motivation. I don't know
Speaker 1: if you ever thought this map, but sometimes I'll hear
Speaker 1: like a motivational speaker or something like that, and like,
Speaker 1: where do they get this energy? They might they always
Speaker 1: like that, right exactly and I know that they're not
Speaker 1: because none of us can be like, none of us
Speaker 1: can be that pumped up, forn like going through our
Speaker 1: lives that pumped up, and so all of us are
Speaker 1: going to lack the motivation at one time or another.
Speaker 1: And that's where automation kicks in, right, and it has
Speaker 1: a really big benefit. But automation also has some downsides.
Speaker 1: And so before we kind of get into the benefits
Speaker 1: and then how you should kind of go about implementing
Speaker 1: automation into your personal finances so that you can succeed
Speaker 1: with money this year, well we need to at least
Speaker 1: cover some of those downsides first. It's really it's just
Speaker 1: not a magic pill. It's not a cure all. So,
Speaker 1: like a lot of different things we talked about on
Speaker 1: the podcast, automation is this tool that we want to
Speaker 1: implement and use in a way that will benefit our money.
Speaker 1: But but the biggest benefit of automation is actually also
Speaker 1: its biggest downfall. When we automate our personal finances, we
Speaker 1: tend not to think about those things anymore, and putting
Speaker 1: that distance between our mind and our money can be
Speaker 1: a bad thing because we've essentially removed it from our
Speaker 1: minds would we automate. We tend to say that's done,
Speaker 1: and I don't have to even worry about it anymore.
Speaker 1: And that's just not the case right there. There's still
Speaker 1: a lot of intentionality and thought that needs to go
Speaker 1: into how we handle our money, even if we're doing
Speaker 1: well at automating. Yeah, exactly, I mean, well, that's exactly
Speaker 1: what happens. Like when you automate something, you don't think
Speaker 1: about it nearly as much. That makes me think of
Speaker 1: the cruise control, like setting the cruise control on your car.
Speaker 1: You set it and you forget it, Like it's not
Speaker 1: something I continually think about how fast am I going?
Speaker 1: Because I know I can trust the cruise control that
Speaker 1: allows me to listen to podcasts or talk to my wife.
Speaker 1: Your speed is not gonna change. You can count on
Speaker 1: your cruise control. But the same thing isn't exactly true
Speaker 1: when we automate our money. When it comes to our
Speaker 1: personal finances, auto nation doesn't mean ignoring it right, not
Speaker 1: looking at your bills and statements. Some people treat automation
Speaker 1: this way. But automation won't keep you from these recurring
Speaker 1: monthly expenses in your credit card. You still need to
Speaker 1: look at your statements, or you need to check mint
Speaker 1: so that you can keep tabs on where your finances
Speaker 1: are and slash spending where it's needed. Especially considering this
Speaker 1: day and age that we live in, with I D
Speaker 1: theft and with your credit card numbers floating out there,
Speaker 1: you need to know what your expenses are. You need
Speaker 1: to be able to keep tabs on your incoming and
Speaker 1: outgoing money. Yeah, just because you've got your credit card
Speaker 1: set up on auto pay, you know, for for the
Speaker 1: full balance, Well, that doesn't mean that you don't have
Speaker 1: to pay attention to what you're putting on that credit card,
Speaker 1: right to the spending that you're actually making. And automation
Speaker 1: can be really big for in particular saving and investing.
Speaker 1: But let's talk about our expenses. Do we really want
Speaker 1: our expenses to be automated? And we'll get into more
Speaker 1: of this a little bit later in the show too,
Speaker 1: but I just want to pull this example out, Matt.
Speaker 1: My utility bills every single month, I'm really intentional about
Speaker 1: opening up the email with how much I've spent on
Speaker 1: water usage or natural gas usage or electricity usage. I
Speaker 1: want to know exactly how much I'm spending every month,
Speaker 1: I like to look those utility bills in the face
Speaker 1: and then I pay that bill. I think it's okay
Speaker 1: to automate some of these bill payments, but it doesn't
Speaker 1: mean you shouldn't look at them before you pay. I
Speaker 1: think looking at your bills in the face is a
Speaker 1: powerful thing that can actually be a challenge for us
Speaker 1: to use less or to spend less. And and I
Speaker 1: think sometimes when we automate, like you said, it feels
Speaker 1: like hitting the cruise control button and we decide not
Speaker 1: to pay attention in the way that we used to.
Speaker 1: But I think we still have to pay particular attention
Speaker 1: to our expenditures and how much the bills are that
Speaker 1: are coming in every month, because that can help us
Speaker 1: make necessary changes to be able to save more and
Speaker 1: automate more of that money away towards our investments and savings. Yeah, man,
Speaker 1: well so far right. We're talking about expenses and and
Speaker 1: bill pay things like that. But you just mentioned being
Speaker 1: able to save more money, and that's so true, because
Speaker 1: that's something we need to consider saving and investing. I
Speaker 1: think when it comes to automation that it also cause
Speaker 1: you to forget to increase your four oh one K
Speaker 1: contribution when it comes to the amount of money that
Speaker 1: you're investing in your retirement. Right, just like with our
Speaker 1: other with our different monthly utility bills, when we set
Speaker 1: it and forget it, we might fail to challenge ourselves
Speaker 1: to do better to increase the amount that we're setting. Aside, Joel,
Speaker 1: you recently talked about with gamification, when you go in
Speaker 1: there and you increase that percentage, the confetti flies, the
Speaker 1: banner goes across the screen. Not only are you missing
Speaker 1: out on that little, small, tangible reward, but but we're
Speaker 1: missing out on lots of money down the road when
Speaker 1: we fail to sit down and look at our money
Speaker 1: and to see what kind of shape our personal finances
Speaker 1: are in. Well, I will say a beautiful thing. More
Speaker 1: and more employers are offering four oh one K accounts
Speaker 1: that automatically increase your contribution level every year when you
Speaker 1: get a raised and so I think that's really really nice.
Speaker 1: That's another thing that we don't have to think about.
Speaker 1: But it is happening, right. But if your employer isn't
Speaker 1: doing that, I agree your automation maybe setting it and
Speaker 1: forgetting it, getting that employer match you're putting in six
Speaker 1: and your employers putting in three you know, whatever your
Speaker 1: employer matches. If you're hitting that, you might just forget
Speaker 1: every year to add a little bit more So having
Speaker 1: that automated six percent withdraw from your paycheck, that's great,
Speaker 1: but you do want to challenge yourself to step that
Speaker 1: up over the years, and automation can actually be that
Speaker 1: kind of detractor because you're not thinking about it. So
Speaker 1: I think the key to not letting automation turn into
Speaker 1: something like apathy is to help set calendar reminders. For instance,
Speaker 1: like maybe twice a year, you can look at the
Speaker 1: automation choices you've made and you can see if those
Speaker 1: allocations need to change or improof. If you find that
Speaker 1: you have this tendency to set it and forget it, well,
Speaker 1: now is a great time to kind of populate a
Speaker 1: couple of these times in your calendar for you know,
Speaker 1: the next twelve months where you are going to revisit
Speaker 1: the savings and investing choices that you have currently automated
Speaker 1: so that you can potentially increase or improve you know,
Speaker 1: those financial choices that you're making. All right, man, so
Speaker 1: so far, it sounds like we're kind of down on automation,
Speaker 1: but we're not, but we're not exactly, and we're gonna
Speaker 1: get to that right after the break. We're gonna talk
Speaker 1: about some of the actual benefits of automation, some of
Speaker 1: the mob us but some of them not so obvious.
Speaker 1: All right, Matt, we're back from the break. We're talking
Speaker 1: about automation, how it can be a big win for
Speaker 1: your finances and especially you know New Year resolutions, you
Speaker 1: know what, are resolved to increase your automation skills and
Speaker 1: to make it we'll make it a whole lot easier
Speaker 1: for you to save money for the future. Right, and
Speaker 1: so let's talk about some of those benefits. Because we
Speaker 1: were not down on automation, we really love it. The
Speaker 1: biggest benefits that you're going to receive from automating your
Speaker 1: finances our behavioral in nature. Automation's main goal is in
Speaker 1: getting us out of our own way. So if we
Speaker 1: see money hanging out in our account, it's really easy
Speaker 1: for us to spend it, and automation can be one
Speaker 1: of the main keys to help prevent us from messing
Speaker 1: ourselves up. Right, Matt, Dude, we're not perfect, right like you.
Speaker 1: You're talking about the motivational speaker there earlier how they
Speaker 1: have like boundless energy. I think sometimes folks my falsely
Speaker 1: think that we make all the perfect decisions when it
Speaker 1: comes to our money. But like you said, sometimes when
Speaker 1: I see money in my account, I want to spend
Speaker 1: it because, like, I worked hard for that money, and
Speaker 1: I think I deserve something completely man easy to justify.
Speaker 1: I have those treat myself days that where I think
Speaker 1: I deserve something and sometimes I act. And that's why
Speaker 1: I need automation in my life to help me make
Speaker 1: sure I'm funneling money in the proper directions for my
Speaker 1: greater goals exactly so because of that, automation can be fantastic.
Speaker 1: One of the biggest benefits that I think everybody can
Speaker 1: easily relate to is the fact that automation will say
Speaker 1: of us time, right, like, who likes spending nights and
Speaker 1: weekends budgeting? Not this guy? Sometimes I do, though I'm
Speaker 1: going to confess I am I am, I love excel
Speaker 1: I like I like to see that zero at the
Speaker 1: end where it's all balanced out. But we have to
Speaker 1: spend some time working on our money and deciding where
Speaker 1: it goes. But the more that we and I'll you know,
Speaker 1: I'll say I as well that I can automatically funnel
Speaker 1: that money into the desired places. The more time we'll
Speaker 1: have to do other more fun things like more are
Speaker 1: meaningful things as well. You're talking about discolf, right yeah,
Speaker 1: or like more admirable things that was on the podcast,
Speaker 1: like spend with my family. I'm gonna go with discolf
Speaker 1: do it for the kids, so yeah, I think. Yeah,
Speaker 1: automating that's one of the biggest benefits, right, more time
Speaker 1: to do the things that you actually want to do,
Speaker 1: like spend time with your family or play discoff And
Speaker 1: then another thing. Automation truly does help increase your mental bandwidth.
Speaker 1: We live these complicated lives right and in general and
Speaker 1: just overall, and then financially too. I feel like our
Speaker 1: financial system has gotten so complex, there's so much intricacy
Speaker 1: to it. And not only does automating save you that time,
Speaker 1: but it means that less of your mental faculties are
Speaker 1: tied up thinking about money on the leg, so crushing
Speaker 1: your money game while thinking about it less that's say,
Speaker 1: plus that's what you want. You don't want that your
Speaker 1: brain resources tied up, you know, thinking about money all
Speaker 1: the time in the background, sucking up that energy. Do
Speaker 1: you want to know that you've made the right choices
Speaker 1: and you've automated them so that you can spend less
Speaker 1: of your mental resources thinking about where that money has
Speaker 1: to go. Yeah, it makes me think of so our
Speaker 1: interview recently with Vincent right, he talked about how when
Speaker 1: you have money freedom, you have mental freedom. And when
Speaker 1: you have mental freedom and you have a little bit
Speaker 1: of space for your mind to like daydream and wander
Speaker 1: a little bit, like, that's when we get creative. And
Speaker 1: sometimes that's when we have the best money saving or
Speaker 1: even the money making ideas. And if all that mental
Speaker 1: bandwidth is tied up in making sure that bill is
Speaker 1: paid on time or thinking about whether or not we're
Speaker 1: investing properly, that can be hugely detrimental. Yeah, man, And
Speaker 1: automation ultimately, like I think probably considering our shows how
Speaker 1: the money the biggest thing is automation will help you
Speaker 1: save more of your money. Well, that sounds nice, yeah, right,
Speaker 1: I mean it's a huge benefit and it's so much
Speaker 1: easier than willpower. Right. If I personally actually had to
Speaker 1: set aside a big chunk of my pay towards investments
Speaker 1: every two weeks, I probably wouldn't do nearly as good
Speaker 1: a job at it. But automating that decision means it
Speaker 1: gets done and I don't have to be super disciplined.
Speaker 1: Being disciplined in that initial decision. Making that one hard
Speaker 1: choice at the beginning means that I'm gonna save a
Speaker 1: whole lot more and I don't have to continually muster
Speaker 1: up the willpower to make sure it happens. Yeah, dude,
Speaker 1: it makes me. It takes me back to that statement
Speaker 1: when we're talking about engineering these systems right like at
Speaker 1: the beginning there, because yeah, you've made that one hard decision,
Speaker 1: you've done the research, you've done all this upfront. You
Speaker 1: don't have to do that every single time. You don't
Speaker 1: need to be constantly reinventing the wheel. You know it works.
Speaker 1: You have decided what you're gonna do. Basically from here
Speaker 1: moving forward, what we're doing, we're monitoring and we're managing
Speaker 1: our money. We're not going through the steps that require
Speaker 1: that you know, all that willpower. Just like you said,
Speaker 1: and Jo, you're talking about how automation can help us
Speaker 1: to save more money and when it comes to investing, right,
Speaker 1: but as far as our expenses go, automation can also
Speaker 1: help us to save a lot of money as well.
Speaker 1: I'm thinking about if you forget to pay, say a
Speaker 1: certain bill, like we hate paying fees and interest as well, right,
Speaker 1: so any tool that keeps more of our money in
Speaker 1: our pocket, we're going to be all about that. Yeah,
Speaker 1: automation auto pay is so helpful because forgetting to pay
Speaker 1: not good, you know with that. No, and automation also
Speaker 1: is this easy route I think to helping us develop
Speaker 1: strong financial habits. The more we automatically do something, the
Speaker 1: more it kind of becomes this ingrained part of us.
Speaker 1: If you ended up saving ten percent of your income
Speaker 1: last year because of your automation brilliance, well, now you
Speaker 1: begin to kind of see yourself as a great saver,
Speaker 1: and that's really motivating, right. It kind of changes how
Speaker 1: you view yourself as you make better decisions and you
Speaker 1: start to see progress. It's it's really motivating and it
Speaker 1: informs how you view yourself. And so yeah, I think
Speaker 1: that's a really important thing to mention. Automating your finance
Speaker 1: as well and succeeding helps you see yourself at a
Speaker 1: new light. Helps you see yourself as somebody who is
Speaker 1: good with money, because you know what now you are Yeah,
Speaker 1: positive reinforcement, dude, it's so valuable. Uh. And then lastly,
Speaker 1: I want to mention to how you can achieve your
Speaker 1: goals faster when your money is automated. Right. Of course,
Speaker 1: automation will help us to get where we want to
Speaker 1: get at a more rapid clip. Automatic saving and automatic
Speaker 1: investing will allow us to actually achieve what we want
Speaker 1: without burning out or changing our mind. Again, we are
Speaker 1: human beings, were a tempted to spend money that we shouldn't.
Speaker 1: An automation will help those goals that we've identified and
Speaker 1: set out to achieve. It can make those goals a reality. Yeah.
Speaker 1: I mean, we talked about Henry Ford's assembly line and
Speaker 1: how it took the production down from twelve hours to
Speaker 1: two and a half, and I'm really interested. I don't
Speaker 1: know how long it takes a Model three to be built,
Speaker 1: but I have to imagine that once that car production
Speaker 1: process becomes fully automated, and then Elon can start tinkering
Speaker 1: with how long it takes it to be built. Maybe
Speaker 1: he can build a Model three in like twenty minutes.
Speaker 1: I don't know, but like that's that's possible. That's possible.
Speaker 1: Automation you can have these abilities obmostly you didn't foresee
Speaker 1: and I think, yeah, I really will help us to
Speaker 1: achieve our goals much much faster because we're not constantly
Speaker 1: changing our mind and stumbling over our own poor decisions
Speaker 1: and did our own behavior has so much of an
Speaker 1: impact on the amount of money that we're able to
Speaker 1: save and invest. So much of the knowledge we know, right, Like,
Speaker 1: we know the things that we're supposed to do. The
Speaker 1: problem is is that we are often bad at doing
Speaker 1: the things that we know that we need to do.
Speaker 1: That's why automation is great. So how do we then
Speaker 1: actually start automating our finances making sure that we do
Speaker 1: it well. Well, let's get into some of the specifics
Speaker 1: of how to go about it, and we'll get to
Speaker 1: that right after the break. All right, you know what
Speaker 1: I think we should do? Now, jel get back to
Speaker 1: talking about automation. Let the show go on. Yeah, so
Speaker 1: let's discuss now how to go about automating our money.
Speaker 1: Now you know the potential pitfalls and have become convinced
Speaker 1: of the benefits of automation, let's talk now about how
Speaker 1: you can actually implement automation into your personal finance life. First, off,
Speaker 1: let's talk about a cushion, or maybe some folks call
Speaker 1: it a slush fund. Having the right accounts is really
Speaker 1: helpful when it comes to automating your money. Having the
Speaker 1: right accounts and then having the right amount of money
Speaker 1: in those accounts and emerge as he fund or a
Speaker 1: cash cushion can make automation much less stressful. If you
Speaker 1: aren't sure whether or not you can pay your credit
Speaker 1: card and full as a statement draws near like that
Speaker 1: can be really difficult and put you in a stressful position.
Speaker 1: Automating without a proper cushion can cause you to overdraft
Speaker 1: your account or have a payment denied, causing you to
Speaker 1: pay more interest and fees. So if you are keen
Speaker 1: to take advantage of automation, make sure that you have
Speaker 1: a solid savings built up. We recently talked about margin
Speaker 1: and Our Lives Sold Episode one two three is the
Speaker 1: first one of the year. Yeah, yeah, and that was
Speaker 1: really kind of twofold. We talked about margin in a
Speaker 1: financial sense and then margin kind of in a time
Speaker 1: sense and kind of how we live our lives, and
Speaker 1: we're trying to build both of those in our lives
Speaker 1: more and more, and on the financial side, the more
Speaker 1: of a cash cushion that you have, the more automation
Speaker 1: feels good, because, yeah, if you don't have to worry
Speaker 1: about it, if you've automated everything, but you're not sure
Speaker 1: that you have the money to to actually to follow
Speaker 1: through on what you've automated, then that that that can
Speaker 1: be a scary place to be. And so yeah, you
Speaker 1: do need to prioritize building up some savings as you
Speaker 1: get into automating your finances more and more. If you
Speaker 1: don't have a cash cushion there, that kind of feels
Speaker 1: like having your cruise control on through like a work zone.
Speaker 1: It's like you have your like dodging traffic. You're thinking,
Speaker 1: I really shouldn't be doing this, but it's it's an autopilot. Yeah,
Speaker 1: Like that's not the kind of position that you want
Speaker 1: to be in. Yeah, completely, buddy. And another thing we
Speaker 1: need to talk about when we're talking about implementing automation
Speaker 1: into our lives is auto bill pay. Like we mentioned
Speaker 1: earlier in the episode, we don't want automatic bill pay
Speaker 1: to keep us completely ignorant to what our expenses are.
Speaker 1: And I think sometimes that can be the case, but
Speaker 1: you can save a lot of time by setting up
Speaker 1: auto pay if a utility or service provider has that
Speaker 1: as an option, every bill or payment that we can automate. Man,
Speaker 1: we're setting it up because we don't want to forget,
Speaker 1: and honestly, it's just a hassle to go in there,
Speaker 1: log in and make the payment most of the time.
Speaker 1: Taking that off my mental plate is just huge. But
Speaker 1: like we mentioned earlier, that doesn't take away your responsibility
Speaker 1: to kind of manually budget for those things. Automating those
Speaker 1: payments is great. Just make sure you're still paying attention
Speaker 1: to what you're ending. Yeah, Joe, you just briefly mentioned
Speaker 1: this earlier, But just having that email show up in
Speaker 1: your inbox and actually looking at that email right when
Speaker 1: you get that new statement, and I think that can
Speaker 1: be really helpful for folks because in that case, you're
Speaker 1: not having to say manually enter that amount into how
Speaker 1: much you're gonna pay, it's gonna automatically pay. But just
Speaker 1: to see it and be presented with that information that
Speaker 1: alone right there, it can be enough to kind of
Speaker 1: nudge you in the right direction if you are overspending.
Speaker 1: Another practice that we can take when it comes to
Speaker 1: automating some of our money is setting up direct deposits
Speaker 1: and not only doing that, but preferably doing this in
Speaker 1: two different accounts to aid in savings. Right, investing, it's
Speaker 1: really important. We talked about investing all the time, but
Speaker 1: so is having money and a savings account. You know, Joe,
Speaker 1: I think we're gonna do a show coming up soon
Speaker 1: about liquidity and when it makes sense to have money
Speaker 1: in savings, Like we don't want all of our money
Speaker 1: going towards investing, but if you can have your money
Speaker 1: auto deposited into an account that you don't touch, that
Speaker 1: can make a major difference in your ability to save. Yeah,
Speaker 1: and Acorns, by the way, is one of those eight
Speaker 1: apps for helping you automate your savings. So yeah, it's
Speaker 1: worth potentially signing up there. And you you mentioned at
Speaker 1: one point your buddy who is able to save up
Speaker 1: for an international golf trip through Acorns over a couple
Speaker 1: of years time. And so yeah, I think people that
Speaker 1: are having trouble maybe they don't want to do a
Speaker 1: too account direct deposit for savings. Acorns can be this
Speaker 1: other method of automation that can really help spur people
Speaker 1: on towards saving money when they otherwise wouldn't have. But
Speaker 1: let's get into another aspect of automation that you really
Speaker 1: need to consider, and that's paying yourself first. And we
Speaker 1: hear this term used often in personal finance, but let's
Speaker 1: get practical. If you work for an employer that offers
Speaker 1: a retirement plan, you can enroll and set a percentage
Speaker 1: of your paycheck to be automatically with drawn so that
Speaker 1: you're not even tempted to not save that money. And
Speaker 1: this is particularly important if you have access to an
Speaker 1: employer match. When we're talking about automating, of course, we
Speaker 1: don't want to forget to pay a bill. That's really helpful,
Speaker 1: but more than anything, we want to be able to
Speaker 1: increase our savings, right We want to do better, save more,
Speaker 1: and have more control over our financial lives. And that's
Speaker 1: ultimately what automation can bring. So this is so important
Speaker 1: in automation. Make sure that, in particular, if you have
Speaker 1: an employer match, you bump up the amount that you're
Speaker 1: investing to at least take full advantage of that. Right there,
Speaker 1: that's automation success number one that you should be striving for.
Speaker 1: Or on the other angel, if if you don't have
Speaker 1: a work sponsored retirement plan like me, right. You can
Speaker 1: even just have an automatic withdrawal set to your savings
Speaker 1: or your WROTH accounts. What's a month. What is key here, though,
Speaker 1: is that you are removing the option to not save
Speaker 1: or invest your money because it's automatic. However, if your
Speaker 1: income is variable and it fluctuates wildly to where there
Speaker 1: are some months maybe that you don't even get paid,
Speaker 1: then this is gonna be tougher to implement, right, But
Speaker 1: you can still set up a process and a system
Speaker 1: where you prioritize saving and investing first before you do
Speaker 1: anything else. So, for example, let's say you don't get
Speaker 1: paid for two months, and then when you do get
Speaker 1: paid in that third month, right, maybe at the end
Speaker 1: of the quarter, you know that the first thing you
Speaker 1: do is that you work towards maxing out your wrath
Speaker 1: ira A. What's key here is that it is an
Speaker 1: automatic action, right, It's not this painful deliberation Every single
Speaker 1: time that money gets deposited into your account. You can
Speaker 1: work towards that rath r A or maybe you're just
Speaker 1: setting aside a predecided percentage. Again, this is something that
Speaker 1: is predecided upon. It's not something that in the moment
Speaker 1: you're having to make that call. Maybe it's not quite
Speaker 1: as automatic right as a work sponsored retirement plan, but again,
Speaker 1: the process is what's automatic here, and that's what you're
Speaker 1: going to make sure that you have in place before
Speaker 1: the checks that even arrive. Yeah, the more deliberation that
Speaker 1: you have to involve in the process, the less likely
Speaker 1: you are to do a good job at taking that
Speaker 1: money and and setting it aside for the future. Matt.
Speaker 1: The other thing, and we mentioned it earlier in the
Speaker 1: show briefly, was the automatic increases. And a lot of
Speaker 1: employers are making this standard. Other employers are just giving
Speaker 1: you this ability, you know, And I have this through
Speaker 1: my employer, Like, it's not automatic, but I can choose,
Speaker 1: you know that every year when I do get a raise,
Speaker 1: I can bump up what I contribute one or two
Speaker 1: sent or more, right, if I want to get super
Speaker 1: boller with it. I think for folks whose employers are
Speaker 1: basically auto enrolling them in those automatic increases, make sure
Speaker 1: to leave those put. And if you have the ability
Speaker 1: to go inside your plan and create those automatic increases
Speaker 1: on your own, behalf. That's something you should be doing too. Yeah,
Speaker 1: and Juel, you know, we were talking about automating the
Speaker 1: amounts of money that goes towards retirement. But it's also
Speaker 1: going to talk about where the money is going within
Speaker 1: those retirement accounts. Right, for a lot of folks, if
Speaker 1: they had to keep up with where their money was
Speaker 1: being invested, they had to monitor the performance of different
Speaker 1: companies and different funds. That process and just those steps
Speaker 1: can not only be a hurdle, but I think it
Speaker 1: could actually become an impassable barrier that keeps folks from
Speaker 1: investing properly and investing the amount of money that they should.
Speaker 1: And so a way to get around that and to
Speaker 1: automate your retirement fund allocation is to look at target
Speaker 1: day retirement funds. These funds are basically automatically reallocating their
Speaker 1: selling funds. They're they're buying other funds based on the
Speaker 1: priests standard that changes as you draw closer towards your
Speaker 1: target retirement date. Yeah, normally you're gonna have to fool
Speaker 1: around with that stuff yourself. Right, You're gonna have to
Speaker 1: reallocate your money. And Matt, we like index funds that
Speaker 1: track you know, the American stock market as a whole,
Speaker 1: or even the world stock market as a whole. And yeah,
Speaker 1: but a target retirement fund is another great option for
Speaker 1: people in particular if they don't want to have to
Speaker 1: ever think you don't have to mess with it at all.
Speaker 1: You pick it once, never change it again, and that's
Speaker 1: that's cool, And it's especially cool if you're one of
Speaker 1: with one of the super low cost providers that charges
Speaker 1: next to nothing to manage those funds, like Vanguard Fidelity.
Speaker 1: Both are great. Yeah. Man. Also, I think it's fascinating
Speaker 1: to think about the future of automation. I think there
Speaker 1: are gonna be changes, but we've already seen in the
Speaker 1: past few years companies creating amazing automation systems that are
Speaker 1: helping consumers navigate the complexities of the financial world. We
Speaker 1: mentioned Acorns, that's one of them. Better met in Wealth Front.
Speaker 1: They kind of did that for investing, and then other
Speaker 1: companies have kind of even improved on that, like in
Speaker 1: one I think. But it's gonna be really interesting to
Speaker 1: see how software has this role to play. We're already
Speaker 1: using it and it's already benefiting us, but I think
Speaker 1: the benefits are only going to increase in the upcoming years,
Speaker 1: and the things that the software can do to help
Speaker 1: us do better with our money automate more of our finances,
Speaker 1: put our money in the right locations so that we
Speaker 1: don't have to worry nearly as much. I think it's
Speaker 1: gonna happen. I'm just interested to see how that plays
Speaker 1: out and what companies end up creating the best products
Speaker 1: for us to use. Yeah, Juel, you know, it's fascinating
Speaker 1: right to think about what artificial intelligence, what that's gonna
Speaker 1: look like for us, and what it's gonna look like
Speaker 1: for our money. There's an article about artificial intelligence and
Speaker 1: our money and how at some point, you know, it
Speaker 1: might even be like Google Maps. Like there used to
Speaker 1: be a day and age where everybody knew the names
Speaker 1: of all the streets, and because you knew the names
Speaker 1: of the streets, that's how you got to your destination.
Speaker 1: But this article is equating the technology that we're gonna
Speaker 1: have access to, how it's gonna be like Google Maps,
Speaker 1: and essentially you just punch in your destination. You just
Speaker 1: say this is where I want to be financially in
Speaker 1: ten years or twenty years or thirty years, and these
Speaker 1: are the steps you follow. And so we're not at
Speaker 1: that point right now, though, right like we have to
Speaker 1: be informed there are certain things we need to know
Speaker 1: how to do. We need to know how to modify
Speaker 1: our behavior and do those things right, because in the end,
Speaker 1: nothing is going to actually make us do the things
Speaker 1: that we say we want to do other than ourselves.
Speaker 1: But it's crazy to think that. And maybe an app
Speaker 1: on our phone that we can just puns in our
Speaker 1: financial destination and arrive there if we do what that
Speaker 1: app tells us to do. Yeah, it's called predictive financial software,
Speaker 1: and it's just it's fascinating to think what that could do,
Speaker 1: how that could be implemented into our lives via potentially
Speaker 1: an app on your phone. Right, But ultimately, there are
Speaker 1: some current steps we can take and some apps out
Speaker 1: there to help us along the way towards automating our
Speaker 1: finance as well, so that our money situation looks brighter
Speaker 1: six months from now, a year from now, and it
Speaker 1: kind of takes that wild card, which is our tendencies
Speaker 1: towards handling money poorly out of the equation. Yeah, So
Speaker 1: hopefully you can take some of the steps we just
Speaker 1: mentioned and automate your finances. The steps you haven't taken,
Speaker 1: we'd encourage you to jump on them, because we really
Speaker 1: do think it's gonna have a major or impact on
Speaker 1: how much you're able to save and the financial freedom
Speaker 1: you're able to create in your life. Yeah, buddy, that's right, man.
Speaker 1: So let's go ahead now and swing it back towards
Speaker 1: the beer. On this episode, we enjoyed a Daglo I
Speaker 1: p a by Allegion. This one was sent to us
Speaker 1: by Joe from up there in Minnesota. He said these
Speaker 1: were some of his favorites. So, Joe, thank you for
Speaker 1: sharing one of your favorite I p a s with us. Joel,
Speaker 1: what were your thoughts? And this was an interesting I PA.
Speaker 1: I feel like it's different than a lot of the
Speaker 1: ones we drink. This one had a lot more floral
Speaker 1: notes to it, and I had some fruit mixed into that.
Speaker 1: So yeah, I pas can take on all these different
Speaker 1: notes depending on kind of how it's brewed and the
Speaker 1: hops that are used, and this particular one had this
Speaker 1: real flaoral bouquet going on in the nose and on
Speaker 1: my taste, Budds, It's funny I pas never get old
Speaker 1: to me because they are also unique and distinct, and
Speaker 1: they're all beautiful snowflakes. Yeah, they really, they really are. Yeah.
Speaker 1: So this one was good Man. I really appreciated the
Speaker 1: allegian Daelo I p A so big. Thanks to Joe
Speaker 1: for sending this one are away. Yeah, Budy, I thought
Speaker 1: this was a really tasty I p A. The best
Speaker 1: way I think I can describe it was that it
Speaker 1: was it was fruity, but it's also like juicy and wet.
Speaker 1: I think with a lot of the recent I p
Speaker 1: as we've had that are dry hopped, in my mind,
Speaker 1: they taste dryer. They kind of have that dry hot bitterness,
Speaker 1: and so if you have a more traditional ip like this,
Speaker 1: it's easy for my mind to go towards the fact
Speaker 1: that these are kind of like juicy wet. It makes
Speaker 1: me think of like a lemon pepper wet. Did you
Speaker 1: ever get lemon pepper wings? I always go lemon pepper dry,
Speaker 1: though lemon pepper wets the way to go. Is it really? Okay,
Speaker 1: I'll give it a shot. This is a weird tangent,
Speaker 1: but anyway, I want to describe this beer as fruity
Speaker 1: juicy wet because that's just warm my heads. That tonight? Cool?
Speaker 1: All right, buddy, that's gonna do it for this episode.
Speaker 1: Thanks again to Joe for sending this beer are away.
Speaker 1: And for folks that want to check out the show
Speaker 1: notes or listening on our website, or check out the
Speaker 1: other articles that we've got up on our website, just
Speaker 1: go to how to money dot com. And if you're
Speaker 1: listening to this episode and you have found something of value,
Speaker 1: right like you, you you heard something that you know
Speaker 1: you can implement into your life that's gonna make a
Speaker 1: positive impact on your money. We would love for you
Speaker 1: to head over to Apple Podcasts and leave us a review.
Speaker 1: If you haven't done that already, you can do that there.
Speaker 1: And wherever it is that you listen to your podcast,
Speaker 1: make sure that you are subscribed, because that makes sure
Speaker 1: that you don't miss out on any new future content
Speaker 1: that we release that can provide more value for you.
Speaker 1: All Right, buddy, that's it until next time. Best Friends Out,
Speaker 1: Best Friends Out.