Tips for Automating Your Financial Plan

Who else has money on the brain? Tax season always has me both lamenting my mediocre recordkeeping and vowing to do better the following tax year.

In the years since my kids were born, I've gotten lazy about financial housekeeping. Even as our money matters grew more complicated (mortgage, self-employment, and all that insurance), our organization system failed to keep up. Papers went unfiled, bills got forgotten here and there, unnecessary expenses were ignored. Well, folks, this is it. 2010 is the year I follow up my idle complaints with action.

The last time I paid this much attention to our finances I was a newlywed with a combined income of $30k, no kids, no house, and no Internet to speak of. My oh my...how things have changed. Now we've got online banking, free financial planning tools, automatic bill-pay, iPhone apps, and text alerts sent straight to our phones. No excuses, right? Problem is, there's so much technology that can help with financial planning, it's hard to know where to begin. Some of us get overwhelmed by too much information causing us to find the nearest sandbox in which to bury our heads. The trick is to set up a system that runs in the background; providing only the information you need, taking care of routine, time-wasting tasks, and helping you reach your financial goals.

My plan is to keep it simple. Fortunately, there's a lot of help on the Web. Sure, there are tools (the best of which are detailed in the Life Scoop post Essential Web Resources for Managing Your Finances), but there's also good, tech-savvy advice for using the tools to their best advantage.

I was inspired by Ramit Sethi's advice to automate your financial plan as outlined in his guest post on Tim Ferris's blog: The Psychology of Automation: Building a Bulletproof Personal-Finance System. Ramit, author of the blog and book I Will Teach You To Be Rich, has built a simple-but-powerful system of accounts that operates mostly on its own, paying his bills, saving for retirement and other more immediate goals, and managing his cash flow. His confident (bordering on arrogant) tone charmed me as well -- this dude is smart, and he's got a good sense of humor. A plus when you're talking about financial planning.

Gina Trapani, formerly of Lifehacker and now doing her own brilliant things including working for Expert Labs, wrote a great "Geek to Live" post about automating her finances once she made the switch from 9-5 work to freelance. Despite changes in the online financial planning ladscape in the years since she wrote her article in 2006, her basic setup of automatic transfers, scheduled transactions and notifications holds true.

For me, no financial planning research is complete until I make a stop at J. D. Roth's wonderful blog, Get Rich Slowly. As expected, there's good coverage of financial automation there as well. This system involves setting up separate accounts for automatic bill paying, but still does the job of routine money maintenance well.

I'm now well-armed with a plan. It's time to block out a few hour-long chunks of time to set it all up and then flip the switch. Busy family life won't be my excuse for financial laziness any longer.

What are your time- and money-saving financial planning shortcuts?

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Asha Dornfest is the founder of Parent Hacks -- where savvy parents swap clever, often unconventional, parenting tips. Here's the practical, real-world stuff you'll never find in an "expert" book. Featured in Real Simple, Parents, and PC Magazine.