Managing your finances can seem like a juggling act: you would need to know where your money is going, allocate some to savings every month, make sure that you never miss a bill payment...all while making sure you have enough to retire or meet other big financial goals.
But on the bright side, you do not have to do it all manually.
Here is why you should automate your finances
Automating your finances simply means setting up a system that automatically handles the menial or repetitive aspects of your finances for you. This saves you time, effort and mental energy, as you would not have to do these tasks yourself. For example, instead of worrying about whether you have remembered to pay a bill that was due last week, you can just schedule recurring payments to take care of everything for you.
The best part is that a “set it and forget it” approach to money makes it much easier to stick to your budget and financial goals. Relying on a system that automatically saves and invests your money for you is much easier than relying on willpower.
Automating your finances is not too hard, either. Here are four ways to do so.
1. Automate your expense tracking
If you have ever reached the end of a month and wondered where all your money has gone to, consider tracking your expenses. This gives you a clear picture of how you are spending your money, and whether you are spending too much on ‘wants’ instead of ‘needs’.
You can use a pen and paper (or a spreadsheet) to write down each transaction, but would it not be great if you could get someone else to do it for you? Well, you can. When you pay with your Maybank card or make online payments, the MAE app can automatically log your transaction and assign it to a category (like ‘food’ or ‘transportation’).
If you need to pay with cash, you will still need to log a transaction in the app manually, but having your cashless transactions logged automatically frees up a lot of time.
2. Automate your savings
To automate your savings, set up recurring transfers that automatically funnel some money into separate goals, right after your salary gets banked in.
This can be a powerful strategy for meeting your saving goals. That is because you would be forced to save upfront, instead of saving whatever money you have left over at the end of the month. And since this is done automatically, you will not feel the pain of having to put aside money – it is all done in the background for you.
It is also useful to separate your savings for each goal. You can do this easily with Maybank’s Goal Savings Plan. Just log in to your Maybank account and click “Create Goal” on your dashboard. This shows you exactly how much money you have saved for different purposes, so you can avoid dipping into your savings that were earmarked for other uses. For example, you can set up recurring transactions as such:
- Goal 1: Year-end vacation – RM100 a month
- Goal 2: Down payment for a car – RM300 a month
- Goal 3: Wedding planning – RM500 a month
If you set these recurring transactions at the start of the year, after 12 months you could be looking at RM1,200 saved for a year-end vacation, RM3,600 for a down payment for a car and RM6,000 for future wedding expenses – all without lifting a finger.
3. Automate your bill payments
Your Astro bills, Tenaga Nasional Berhad (TNB) electricity bills, Telekom Malaysia (TM)'s UniFi charges.....keeping track of multiple payment deadlines can be a pain. But by automating your bills, you can save time, dodge late penalty fees and avoid unexpected service cancellations due to missed payments.
For most bill payments, you can set up automatic transactions through online banking. Here is how you can do it:
- Log in to your Maybank2u account, select ‘Pay & Transfer’, then select ‘Pay’.
- Enter your payment details and confirm the payment.
- When the payment is confirmed, click on the message asking if you want the payment to be automatically deducted in the future.
- Enter your recurring payment amount, first recurring payment date and last recurring payment date, then confirm these details.
- Maybank2u will now automatically pay your bill on a monthly basis, until the last recurring payment date is met.
4. Automate your investments
Some of us put off investing because we think it is too complicated or time consuming. But if you don’t start investing, you will miss out on the chance to grow your money and reach your long-term financial goals.
Fortunately, it is possible to take a hands-off approach to investing with a passive investing strategy. As a passive investor, you might want to avoid investing in individual stocks, as this requires a lot of time and effort to research each company and keep up to date with their performance. Instead, you could consider investing in the following:
- Exchange traded funds (ETFs). A collection of investments that track an underlying index (for example, an index that represents the performance of the Malaysian stock market).
- Unit trust funds. A collection of investments that are managed by a fund manager. There is a wide range of unit trust funds to suit different risk profiles and investing preferences.
ETFs and unit trust funds can be great investments for those who do not have the time or knowledge to invest directly.
You can also simplify the investment-planning process with the Maybank Financial Goal Simulator. The tool will help you estimate how much money you may need to invest every month to reach a particular goal, as well as your probability of success. You can even adjust the calculations to simulate different outcomes. This saves you a lot of time from having to crunch these numbers on your own.
Simplify your finances
By automating these tasks and taking advantage of the Maybank Financial Goal Simulator, it is easier than ever to stay on top of your finances. Plus, with a “set it and forget it” system, you may only need to review your finances periodically, such as quarterly or once a year. The rest of the time, you will be free to focus on other things that matter.