If there's anything we can learn from this economy, it's that getting into debt isn't necessary to live the life we need. But if you're used to living a life of credit and debt, how can you ensure you won't get stuck in it again?

By automating your finances, you can prevent yourself from getting into debt. Because once that debt begins to spiral out of control, it can be much harder to hold onto your finances.

When is that Bill Due?

Let's face it — we all lead hectic lives. We're trying to hold together a professional working lifestyle along with active family and social lives, so it's no wonder that our finances can often be the first thing to slip.

It's easy to forget when your bill is due. You know when it's due, but it slips to the back of your mind and, before you know it, you missed the date and you are left with hefty charges and have lost any promotional interest rate with your credit card or loan provider.

If you're not keeping a tight check on your finances, you may have to seek debt advice in the future.

Automatic payments means that you no longer have to worry about remember to pay your credit card debt, unsecured loan repayments or store card bills. As long as the money is in your linked account, the bill will be paid.

Tip: Many credit providers only let you set up a direct debit for the minimum payment. If you are looking to clear your debt much quicker then you might want to set up a standing order as well.

Dealing with Unexpected Financial Expenses

Automatic payments let you put money aside for a those unexpected expenses, using a once-in-a-while fund.

Car costs, essential household maintenance or a financially expensive month will put someone struggling financially on the brink of bankruptcy.

Your debt problems can be resolved by effective budgeting and automating as much as possible. You will never realize how much you spend on gasoline or food shopping until you see it in full.

By taking full control of your own finances, you'll understand the true cost of everyday expenses on your income.

Use a Debit Card for Your Purchases

Many personal finance tips say you should only use cash, but dare to be different! As long as you have control over you budget and won't be tempted to spend any more than you can afford, put everything you spend on your debit card.

With a debit card, you'll have a full log of your spending through online banking and don't have to worry about keeping receipts.

You may also find that purchasing everything with your debit card makes it easier to say no to those little treats (morning latte, vending machine nibbles, glossy magazines) because smaller outlets do not take card payments.

Remember, you are in control of your finances. If you are in debt, seek debt help. Don't put off until tomorrow what you can do today. By automating your finances, you can keep yourself out of debt and get a better grip on your money.

Nobody's perfect, right? I'm not, you're not — and we'd be kidding ourselves to think if we were.

And when it comes to money, we tend to make decisions emotionally instead of rationally, often becoming our own worst financial enemy.

But it doesn't have to be that way. You know that, and I know that.

Unfortunately, sometimes you have to make the mistakes in order to figure out how to do things right.

Fortunately for you, I've done these. So you can learn from my mistakes and avoid making them yourself. And thanks to financial automation, you'll never have to worry about making them (and neither will I).

1. I forgot to make a credit card payment.
   Since I rarely use my credit card (and pay it off in full every month), I completely forgot about the bill sitting in the stack of mail. It had one charge on it, and I didn't pay it that month. I didn't even pay the minimum. Now, I autopay my bills, so I don't have to worry about forgetting to make payments.
2. I never sent in the check for my cable bill.
   This time, I remembered to write the check to pay the cable bill, but instead of dropping the envelope into the mailbox, I lost it in my car. A month or so later, after I checked out my account online and saw the bill hadn't been paid, I found the envelope under the driver's seat. Oops.
3. I wasn't prepared for once-in-a-while expenses.
   No one likes getting a big bill in the mail that they aren't prepared for. It's even worse when you could have prepared for it. I didn't set the money aside for a car insurance payment, even though I knew it was coming, and had to scrounge for the money. Now I have an automatically filled once-in-a-while fund, so the money is always available when the bill comes.
4. A paycheck sat in my wallet uncashed.
   There's nothing more useless than a check made out to you sitting in your wallet, and not in your bank account. When you're carrying around the check, it can't earn any interest in a high-yield checking or savings account or be used to pay your bills. If you have direct deposit, your money is immediately available to be used or saved.
5. I forgot to track my spending.
   It's easy to procrastinate gathering all of your receipts, sitting down with a pencil and paper budget, and calculating your spending. But now that I use a debit card for all of my spending, I can see where my money is going online, either through my bank's site or via my account aggregator.

Take it from me – mistakes happen, but it's best if you can avoid them. Financial automation does the job.

Want to find out more about automating your finances? Download the first three days of Automatic Finances: 17 Days to Your Financial Freedom absolutely free!

When it comes to managing your financial success, there's no one more qualified to make decisions than you. (Yes, not even many fund managers.)

But even though it's up to you to plan out and execute your financial goals, you may be getting in the way of your own success.

Let me share a story with you.

In the Beginning, There Was Ameriprise

When I first started saving for retirement, it was with Ameriprise — the investing/insurance arm of American Express. The only way I knew them was from a free lunch a co-worker of mine invited me to.

I had a great opportunity to start investing for retirement early (I was still pretty young), and wanted to get going, despite not really knowing how it all worked.

As we began to save and invest, I learned more. I read a ton of personal finance books and started automating my finances.

After a bit of learning, I knew that our investments would be better if I managed them myself, using index funds at Vanguard. But I was worried about moving our Roth IRAs — afraid that I couldn't handle them and would screw something up.

So I procrastinated. I waited. I extended the process. I even blogged about it, hoping to get my worry out there.

I came up with a ton of reasons to put off making the move. The process was too long. I had questions about Vanguard's Web site. There would be fees for moving my money.

I didn't want to make the move. But I knew I should.

Finally, of course, I did it. I can't calculate the amount of money I may have lost during my time procrastinating the move, but there's a good chance I did lose some.

It was my fault. And it could have been avoided — if I hadn't stood in the way.

To Overcome Your Inaction, Set a Goal and Automate

The goal of Automatic Finances is to remove that human element as much as possible from the money management process.

There's a reason you should pay yourself first and give every penny a purpose: the less you take a wait-and-see approach to saving, the lower the chance you'll either over- or under-manage your finances and make poor decisions.

• When you automate your savings, you'll always have money to pay yourself first.
• When you automate your investing, you'll never be tempted to time the market.
• When you automate your billpay, you'll never procrastinate paying a bill.

Stop hindering your own success. Set your goal and then make it automatic.

You can either be your biggest asset or your own savings enemy. Which are you?

We often talk about financial automation as a convenience. Instead of having to remember to pay your bills before their due dates, they'll get paid automatically.

But for some bills, there's actually a financial incentive to automating your payments.

While some service providers (like Sprint) may give you a one-time credit for automatic payments and online invoicing, you might be able to save a lot more cash on longer-term loans.

Shaving Interest off of Student Loans

When I graduated from college, I had a pretty fat student loan debt. It's not anything to write home about, but I'm still paying it off.

About 9 months after I graduated, I consolidated my loans with the Department of Education's Direct Loan Servicing Program. As part of the re-payment process, you have the option to enroll in the Electronic Debiting Account (EDA) repayment method.

Like with all autopayment services, the provider wants to ensure that they're getting paid every month, on-time and in full.

So, in order to get more people to enroll, they offer a quarter point discount (.25%) on the loan's interest rate. Instead of a 5.375% APR, it's down to 5.125%.

The second bonus comes from making the first 12 payments on-time — an easy thing to do when you're in an autopayment program.

What's Your Debt Reduction Story?

Next week, I'll be hosting the Carnival of Debt Reduction, sharing your stories about paying off your debt.

If you've got a great story, submit it to the carnival now.

Using your online savings account, you can automate savings from your central checking account on a weekly, bi-weekly, or monthly basis.

Here are 5 reasons to automate your savings.

1. Treat Saving Like a Bill ? Instead of waiting until the end of the month to see how much money you have left over, automating your savings treats it like a bill you have to pay. Saving is now a priority; it's not something you try to do when you can.
2. Pay Yourself First ? The second most important personal finance principle ? after spending less than you earn ? is to pay yourself first. You'll never build your net worth and reach your goals if you aren't saving, and automating that is crucial to consistent growth.
3. Remove the Human Element ? When your money moves automatically, you never make the mistake of forgetting to put it aside, transferring the wrong amount, or making a mental excuse for why you can?t save it this month.
4. Feel Comfortable ? Stop worrying about whether you're saving enough, or if you'll have the cash to put aside this month. When the system is set up to work for you, you can feel comfortable that you're on track to reach your goals.
5. Save Time ? Your time is valuable. Why not use these tools to spend your time doing the things you love, rather than managing your money?

Why do you automate? Let us know in a comment.

If you're like me, you're always surprised at how expensive that car insurance bill is or how much you really owe in taxes.

The expenses that you don't pay on a monthly basis can often sneak up on you before you have the money to pay them.

These bills could include:

• Insurance (auto, homeowner's, renter's)
• Membership fees (yearly dues)
• Charity donations
• Taxes

If you aren't prepared, these expenses can take a bite out of your monthly budget. To fix that, you need a once-in-a-while fund.

How to Handle Your Once-in-a-While Expenses

The once-in-a-while fund transforms your annual/bi-annual expenses into monthly amounts that you put aside in a specific savings account.

So, instead of having to fork out $1000 every January for your homeowner's insurance, you'd be transferring $83.33 every month into your once-in-a-while fund.

Chances are, you have more than one once-in-a-while expenses. List your once-in-a-while expenses, over a full calendar year. Don't miss those that you pay more than once a year. For example, if you pay your auto insurance twice a year, make sure to count it twice.

When you've totaled up your once-in-a-while expenses, divide it by 12. This is the amount you need to be setting aside each month for your once-in-a-while fund.

Open Your Once-in-a-While Account

When you're automating your finances, it's important to have multiple accounts for your many goals.

The easiest way to set aside your once-in-a-while costs is to open a specific account for them. I recommend ING Direct; I use them for my once-in-a-while fund, my emergency fund, my tax fund, and my vacation fund.

After you've opened your ING Direct account, set up an automatic savings plan to pull your once-in-a-while costs each month. Now, when the big expense comes due, you've already got the money set aside to pay it!

Not sure the easiest way to get set up with multiple ING Direct accounts? Automatic Finances details the process in Day 9, "Open Your Short-Term Savings Accounts."

Hello there, and welcome to Automatic Finances!

My name is Jason and, yes, my finances are on autopilot.

What does that mean, exactly?

Let's see…

• My bills pay themselves every month
• I automatically save for retirement without trying to time the market
• My paycheck goes straight into my bank account every two weeks
• My short-term savings accounts are filled themselves, and are earning a high interest rate
• My spending is automatically tracked and categorized, and I receive alerts when I'm approaching my budget limits
• I never get any paper bills
• My net worth is automatically calculated, giving me the best look at my financial picture

I spend as little time as I want going over my finances each month, yet I know that everything is working the way it should be.

So, how much do I spend to have my money managed for me?

Nothing Zip, zilch, nada.

I'm not a rich guy. I don't have a fancy car or a big house.

But I make my money work for me the way the rich do. And it costs me a lot less than they spend.

Using freely available tools online and a mindset dedicated to growing my net worth, my finances are automated.

This blog is all about living the automated financial life. It's about spending more time doing the things you love and less time worrying about your money.

If you're the kind of person who wants to see their net worth grow without collecting receipts or using envelopes to store your cash, you'll like it here.

The best way to get involved is to subscribe now. You'll be happy you did.

For your central checking/debit account, it's crucial that you have a financial cushion as a safety net for your transactions.

What's a financial cushion? An amount of "extra" money to ensure you don't run out when all of your automated transactions occur.

By having this safety net in your main checking account, you'll avoid the worst-case-scenario where your automated payments and transfers and flex spending wipe out your entire balance before your next deposit.

If you've scheduled your payments and transfers far enough apart each month, it's unlikely that you'll need to go into your cushion. But it's certainly worth having that safety net — just in case.

How Big of a Financial Cushion Do You Need?

Your financial cushion can vary from a few hundred dollars up to $1,000 or so.

You should consider two things when deciding how large a cushion you need:

• how big your transactions are
• how worried you would be that your balance will reach zero before it is replenished

Like most other personal finance decisions, it's up to you to figure out your own tolerance.

My financial cushion tends to be around $1000. Since I'm unlikely to get hit with an immediate need for more than $1000 (and that's likely stretching it), I'll have that money to avoid any overdrafts and not have to wait the 2 to 3 days for money from my emergency fund to transfer.

How big is your financial cushion? Let us know in a comment.