Autopilot Your Savings: 4 Ways to Save Without Even Trying

Hi Reader,

Welcome to The Money Series and thank you once again for signing up. Personal Finance can feel ambiguous and overwhelming, but I am here to help simplify the journey.

Can't Remember to Save? Let Your Phone Do the Work!

One of the biggest barriers to saving is simply remembering to do it. Remember the last time you promised to return a friend’s call or get something on the way home? You probably forgot, right?

Relying on memory alone can sabotage your savings efforts. That’s why automating your savings is a game-changer. Let’s explore four effective ways to put your savings on autopilot:

Standing Order. Quite straightforward. Set up a regular payment from your income account to your savings or investment account through your bank or mobile apps. This is ideal if you have a steady income, no emergency need for cash, and/or the presence of an emergency fund.

Auto-saving with AI Apps. These apps link to your bank account, analyze your income and spending habits using artificial intelligence, and automatically transfer an amount you can safely save based on your transaction history to your savings account. A perfect option if you have irregular income or prefer flexibility in your savings and finances. Some popular Apps that offer this are Plum, Cleo, and Chip (note that Chip is not free).

Round-ups. As the name implies, this feature allows Apps to round up your spending to the nearest dollar and transfer the spare change to your savings account. For instance, if you spend $1.80 on groceries, the app will round it up to $2 and save $0.20. An ideal choice for you if you would like your savings to actively track your spending or put differently, reward your future self for every present ‘enjoyment’. Apps that provide this feature include Plum, Chase, Monzo, and Moneybox.

Conditional savings - IFTTT (If This Then That). Currently available only via a Monzo bank account, the IFTTT feature allows you to personalize your finances by making your own rules. This feature can help you save money whenever a specific goal is met, and the goal can be defined as anything from reaching a specified income level to hitting the gym. The account can be linked with other Apps on your phone that can track the goal progress and trigger the savings. For instance, you can link your Fitbit App to Monzo and save money whenever you hit a specified number of daily steps. A great choice for you if you have an irregular income or would only save when certain conditions are met.

These are a few of the ways to automate your savings. Do carefully consider the interest rates on the accounts and select the one with the highest yield. Also, note that automating your savings does not imply that you set it and forget it, you should regularly review your savings strategy to ensure it aligns with your financial goals.

A common mistake I have observed is that people tend to save what is left after spending which is not ideal. Another mistake is leaving the leftover savings in a bank account that earns nearly ‘zero’ returns. You want to avoid both and we will discuss this in subsequent issues.

Questions or comments? Just reply to this email.

Act Now:

Grab your mobile device and automate your savings now!

Reflect on This:

What percentage of your income are you currently saving? Why?

Disclaimer: This does not constitute financial advice. Please conduct your research or consult your financial advisor for important financial advice.

Till next week, I am rooting for you, money-ly!

Dee

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P.P.S: I only hyperlinked some texts to help you research those Apps and features, if you’re interested.