Bible Money Matters

Christian personal finance

Menu
    • About
    • Archives
    • Contact
    • Close
  • Making Money
      • Popular Articles

        • 50 Ways To Make Money: Maximizing, Creating And Increasing Your Income
        • 10 Weird And Unconventional Ways To Make Money
        • Making Money With A Blog (e-Book)
        • 10 Places To Sell Or Trade Your Unused (Or Broken) Electronics
        • Ways To Make Extra Money Series: 20 More Income Generating Ideas From Our Readers
        • Making Side Income Can Help Blunt The Impact Of Becoming A One Income Family
        • Earn Cash Back With Discover it® Credit Card
      • Recent Articles – Making Money

        • Best Sites Like Fiverr To Make Money As A Freelancer
        • 13 Of The Best Independent Contractor Jobs
        • 25 Of The Best Gig Economy Jobs
        • How To Make Money Blogging: Turn A Blog Into A Business
      • Categories

        • Making Money
        • Investing
        • Retirement
        • Jobs & Work LIfe
        • Money
        • Income
    • Close
  • Saving Money
      • Popular Articles

        • 50 Easy Ways To Save Money Every Month
        • 10 Weird And Unconventional Ways To Save Money
        • 10 Practical Ways To Save Money And Increase Your Net Worth
        • How To Save Money On Just About All Of Your Regular Monthly Bills
        • Ways To Watch TV Without Paying An Arm And A Leg For Cable TV
        • Save Money On Your Hospital Bill - Just By Asking
      • Recent Articles – Saving Money

        • How To Save $100k In 7 Practical Steps
        • Stairs App Review: Save And Invest To Earn 4-6% Interest
        • Honey Review: Save Money Automatically When You Shop Online
        • 9 Convincing Reasons Why You Need An Emergency Fund
      • Categories

        • Saving Money
        • Frugality
        • Planning
        • Finance
        • Saving For Retirement
        • Savings Accounts
    • Close
  • Banking
      • Best Rates For 2019

        • Best Credit Cards
        • Best Savings Accounts
        • Best Mortgage Rates
        • Best CD Rates
        • Best Brokerages
        • Free Credit Scores
      • Recent Reviews

        • TradeStation Review: Commission Free Stock And ETF Trades
        • Firstrade Review: Commission Free Trades on Stocks, Crypto, And Options
        • Cadre Real Estate Investing Review: Commercial Real Estate Investing
        • Axos Self Directed Trading Review: Invest, Trade Stocks For Free
      • Categories

        • Bank & Software Reviews
        • Investing
        • Credit
        • Banking
        • Mortgage
        • Insurance
        • Family Budget
    • Close
  • Recommended
  • Video
    • Close

6 Advantages Of Automatic Saving And Investing

By Craig Ford 9 Comments - The content of this website often contains affiliate links and I may be compensated if you buy through those links (at no cost to you!). Learn more about how we make money. Last edited July 22, 2014.

Share11
Pin
Tweet6
Share1
18 Shares

What The Government Can Teach You About Personal Finances

When it comes to the government and money there are a lot of diverse opinions. No matter what you think about the government’s fiscal responsibility, one thing is for certain. Many Americans could learn at least one lesson from the government that will transform their personal finances.

What the Government Knows About Taxes

In the book, The Automatic Millionaire, David Bach spurs the question, How does the government always get their taxes?

The government takes their tax payments off the top before you even have access to it.  This is true unless you are self employed and the government then requires you to make a quarterly tax payment.

The government wants to have access to the money first.  They don’t trust you with the money because you might just blow it all before you get it.  So they make you to complete a W-4 and they take their money before you get your money.

Sometimes we even get generous and pay more income tax than we should.

Do you trust yourself with money? If the government takes taxes out as soon as you get paid and you have paid all your taxes, don’t you think that would be a good strategy for saving?

Almost every banks and investment broker have some automatic savings features.

6 Advantages of Automatic Savings

  1. Simplicity – Many great financial plans fail because they are too complicated.  It is far better to have a financial plan that works than one that just looks good on paper.  If you are not disciplined enough to maintain the plan, it is too complicated.  As an example, many people fail at budgeting because the budget is too complex.  A simple budget is the solution.
  2. Compensates for a lack of discipline – Many people acknowledge that saving money requires discipline.  Discipline that too many openly admit they do not have.  When it comes to automatic savings you only need to be disciplined enough to initiate the process.  From there, the less attention you pay to your savings the better.  Once you have set up your budget all you need to is cruise.
  3. Emotional benefits – Some people find it emotionally burdensome to save.  They think about how they could have got this or that.  They then feel bad that they are saving so much for tomorrow without the chance to live it up today.  However, when you ‘forget’ you are saving money you can mentally disconnect from the process.  In addition, when it comes to saving with the stock market you’ll have less worrying, analyzing, and fretting about the right time.  When that predetermined day for your deposit arrives, it will be the right time.
  4. Better for smaller accounts – If you are trying to save into something like a mutual fund or index fund, then smaller frequent payments actually give you access to funds that you might not otherwise have been able to buy.  Many funds decrease their minimum amount required when you set up an automatic purchase plan.
  5. Results – Don’t argue with results.  This is a proven and effective method for saving money.  Since it has worked for generations there is no reason to think it is going to stop working now.
  6. Time savings – Time is becoming an increasingly valuable commodity.  Automatic savings help you have a larger rate of return and saves you time, energy, and effort in the process.  Just think about it like a ball at the top of the mountain.  You just need to give it a little push and it will do the rest by itself.  All you need to do is organize your finances and then you no longer have any additional time investment.

Do you do automatic saving or investing?  Why or why not?

Related Posts

  • Betterment's New SmartDeposit Feature Can Make Saving Automatic

    Betterment's new SmartDeposit automated saving functionality can be a great way to increase your savings. How? By making investing automatic.

  • 4 Reasons To Start Saving for Retirement Now

    If you want to improve your finances for your future, now is a good time to start saving for retirement. Here are 4 reasons to…

  • My Digit And Axos Invest Experiment Update: Automated Saving & Investing Trial

    I opened free accounts with Digit and Axos Invest to see how much an automated saving and investing plan could lead to. How's it going…

Share11
Pin
Tweet6
Share1
18 Shares
Last Edited: 22nd July 2014 The content of biblemoneymatters.com is for general information purposes only and does not constitute professional advice. Visitors to biblemoneymatters.com should not act upon the content or information without first seeking appropriate professional advice. In accordance with the latest FTC guidelines, we declare that we have a financial relationship with every company mentioned on this site.

This article is about: Investing

About Craig Ford

Craig Ford is a fulltime missionary in Papua New Guinea who writes Money Help For Christians and Help Me Travel Cheap, a frugal family travel blog. He is the author of Money Wisdom From Proverbs, has a Masters of Divinity degree, and (most importantly) eats homemade pizza with his family every Friday night.

Comments

    Share Your Thoughts: Cancel reply

  1. David says

    To me, the easiest way to start saving is thru a 401k. The money is taken out before you even see it.

    Start out with a small amount, work up to what you can afford.
    David/Yourfinances101´s last post ..My Own Little Blog Carnival

    Reply
  2. Lakita (PFJourney) says

    I am a fan of automatic savings and investing. Both happen through direct deposit so I don’t see it eventhough it is a part of my net pay. I also have the savings account at a different bank than my regular checking so I don’t log in and see it on a regular basis. However I do check from time to time to make sure everything stays on track….though rare, computers do make mistakes.

    I’m more passive with the auto investing….I may look at that quarterly just to ensure everything is in line. I’ve taken a “set it and forget it” approach.

    Reply
  3. Peter Anderson says

    For some reason I’ve always been hesitant to set up automatic anything. Whether it’s auto bill pay, auto savings or what have you. I’m not sure why it is, but I do know that it probably needs to change if I want to continue getting ahead..

    Great post!

    Reply
  4. ParisGirl111 says

    I have discovered the best way to do automatic savings is using my 401K at work and setting up individual savings accounts at ING. Then, I just have the money automatically withdrawn from my account on the same day every month, like a bill. I don’t have to think about saving at all because it is done for me.

    Reply
  5. Monevator says

    Another great thing about automatic savings is it’s easier to save when you get a rise. You’ll find it’s no hardship to put say 50% of the extra rise on to the 15%, say, you’re already saving. You’ll still have more money to spend than before!

    5 to ten years like this and you can find yourself socking away a really meaningful amount of money.

    Reply
  6. Darren says

    Good point about the government automatically taking out taxes. Like a few other commenters, I automatically invest in my 401k through payroll deductions. It’s easy to set up, and since I don’t see it on my paycheck, I can’t spend it! This forces me to plan my budget around that net amount in my check, so that I’m not tempted to spend the money if it wasn’t in my 401k.

    However, when investing in my roth IRA in addition to the 401k, I haven’t set up automatic contributions yet. This is because I contribute a high percentage of my salary to my 401k, so that the net amount of my check is relatively small. Therefore, although I plan my IRA contributions around my other expenses, I still make it a point to max out my contributions to both accounts each year.

    @Peter – I personally don’t think it’s a good idea to set up automatic bill pay. For instance, with credit card statements, I like to check the charges to make sure they’re all legitimate and that the totals add up. Besides, it doesn’t take that long to check, and then I can still pay the bill electronically. Like Lakita said, computers do make mistakes sometimes.

    Reply
    • Peter Anderson says

      Yeah, i’m not sure I’d ever set up automatic bill pay unless it was something like an insurance premium or something along those lines. Cable bills, credit cards and other bills like that i like to double check – like you mention.

      Reply
  7. Daddy Paul says

    Automatic savings is a great way to go. If you have to write a check it will always wait until next month. Nine months later you saved nothing.

    Reply
  8. Craig says

    I love things that make things easier for me, and automatic savings does just that. I don’t have to worry about it, I never see it as a loss and keeps things simple and stress free for me.

    Reply
Previous Post: Questions About The New Car Sales Tax Deduction Answered
Next Post: How to Go On A Financial Diet
Discover Investment Platforms

Popular Posts

  • 21 Easy Ways To Earn Free Amazon Gift Cards
  • 10 Best Free Tax Filing Services And Software Online
  • 21 Apps That Pay You Real Money Fast
  • 17 TV Apps And Live TV Streaming Services To Watch TV Free
  • 30 Legit Online Jobs That Pay Well
  • 37 Easy Ways To Get Free Gift Cards
  • How To Get Free Stock
  • 40 Easy Ways To Get Free Money Fast
  • 21 Places To Read Free Books Online
  • 24 Legit Online Jobs
  • 17 Best Work From Home Jobs: A List Of Legit Online Jobs That Pay Well

Recent Posts

  • How To Save $100k In 7 Practical Steps
  • How to Save Money When Remodeling A Home
  • How To Hire A Contractor For Your Remodeling Project
  • Remembering 9/11 Years Later: Where Were You On That Fateful Day?
  • TradeStation Review: Commission Free Stock And ETF Trades
  • Firstrade Review: Commission Free Trades on Stocks, Crypto, And Options
  • Cadre Real Estate Investing Review: Commercial Real Estate Investing
  • Best Sites Like Fiverr To Make Money As A Freelancer
  • Axos Self Directed Trading Review: Invest, Trade Stocks For Free
  • 30 Quotes About Easter And Resurrection: He Is Risen!

Disclaimer

The information contained in BibleMoneyMatters.com is for general information or entertainment purposes only and does not constitute professional financial advice. Please contact an independent financial professional for advice regarding your specific situation.

In accordance with FTC guidelines, we state that we have a financial relationship with some of the companies mentioned in this website. This may include receiving access to free products and services for product and service reviews and giveaways.

Any references to third party products, rates, or websites are subject to change without notice. We do our best to maintain current information, but due to the rapidly changing environment, some information may have changed since it was published. Please do the appropriate research before participating in any third party offers.

Amazon and the Amazon logo are trademarks of Amazon.com, Inc. or its affiliates.

We respect your privacy: Privacy Policy.

Thanks for visiting!

Bible Money Matters - Seen On These Sites and more..
Bible Money Matters is a personal finance, entrepreneurship and investing community. Give more, save more and live more.

Copyright © 2023 · Bible Money Matters | Sitemap | Advertise | Privacy Policy