Automate | Online Savings Blog

12 Ways to Save for a Down Payment on a House
08.26.08 | Money Management | 0 Comments | by junger
We've been saving pretty aggresively to build up a down payment for a house, as hard as it may be.

Thankfully, our automated finances force us to put the money away, so we don't have to wait until the end of the month to see what we have left over to contribute.

MSN Money has a new article up, "How to come up with a down payment," that offers 12 ways to save money for house purchase.
While some of these make great sense — an automatic savings plan, setting aside a bonus and allocating your income tax refund — do they really expect someone looking for a downpayment to have a boat to sell?

I'd also warn against taking money from your 401(k); not only will you have to pay taxes or interest on what you take out, but you'll be losing out on any compound interest you'd otherwise be making.

What tips do you have for saving for a down payment?

Technorati Tags: automate, automatic, downpayment, house, saving
Automate Your Finances, Feel Comfortable
05.14.08 | Money Management | 1 Comment | by junger

One of the biggest reasons you should put your finances on autopilot is for the sheer comfort of it.

Literally.

When your bills are getting paid automatically, your savings is being fed without you touching it, and your paycheck is going straight into your checking account, you don't have to worry about them. It's the biggest weight off of your shoulders.

You don't need to find the time to head to the ATM. You automatically pay yourself first. You don't have to worry about the post office losing your check in the mail.

The only bill I still pay by check is my credit card, and every other day I forget exactly when it's due and, therefore, when I need to send it in. It's weighing down on me.

So much about money management is mental. Am I saving enough? Should I save for the long run or the short run? Do I really need that thing I want?

The less you have to worry about, the better off you are. Don't let your finances overwhelm you.

Automate today and feel more comfortable.

Technorati Tags: automate, autopilot, finances, Money, Money Management, savings
Paycheck to Paycheck On Purpose: It Works
02.23.08 | Money | 0 Comments | by junger

One of the most popular posts here covered why living on a paycheck to paycheck mentality works. (Despite the lack of comments, a number of readers flocked to it.)

Single Ma from Fabulous Financials has a post up over at Consumerism Commentary on how she lives paycheck to paycheck, but is saving money through automatic deductions and taking money off the top.

By the time I receive my “real” paycheck, it’s less than half of what I actually earned, which is ok with me. All of my financial priorities are accounted for, so I have fewer things to worry about. Automation also locks in the funds to make sure I achieve my financial goals (e.g. max out 401k, IRA, and tax deductible college savings).

Having all of your investments, savings and tax-favored spending accounts (FSA, etc.) filled before you get a chance to spend it on impulse purchases is the easiest way to save.

You don't always feel like you're saving because so little work is involved, but you're doing better than if you waited until the end of the month to scrounge up whatever is leftover to put away.

Unless your paycheck is way out of proportion with your spending (on the positive side), try living with a paycheck to paycheck mentality. It works.

Technorati Tags: automate, finances, Money, paycheck, savings, spending
Why Living on a Paycheck to Paycheck Mentality Works
12.26.07 | Money | 1 Comment | by junger

Living paycheck to paycheck isn't a great way to manage your money, but there's something to be said about having a paycheck to paycheck mentality.

We have a nice retirement accounts, an emergency fund, and are even saving specifically for a house. But we still live with a paycheck to paycheck mentality — and I'm glad that we do.

If you have automated your finances — including monthly retirement contributions, debt payments and transfers to high-yield online savings accounts — then living with paycheck to paycheck mentality is okay.

Because our finances are automated, our money is constantly doing something. It's getting added to our Roth IRAs or it's going into our housing fund or getting direct deposited into our checking accounts.

But since many checking accounts (including ours at Bank of America) pay nothing in interest, there's no reason to keep more money in there than necessary. So we only keep a certain amount in our checking account — enough to get transferred via automatic payments or to our outside savings funds and for bills.

This forces us to live a paycheck to paycheck mentality, even though we're saving for now and saving for the future.

With a paycheck to paycheck mentality, you're waiting for that next paycheck, but not just to pay the bills. It's also to invest and to stick into a high-yield savings account.

It works. Give it a shot — find out where all your money goes (start a budget), automate it, and then watch your spending.

Technorati Tags: automate, finances, Money, paycheck, savings, spending

free website hit counter