The Right Times to Re-Automate Your Finances

by Jason Unger

The biggest appeal of automating your finances is that once you set it, you can basically forget it. Everything works as it’s supposed to — your bills are being paid, you’re investing through dollar-cost averaging, and your spending is automatically being tracked.

But there are certain times in life when you need to go back to your finances and make sure everything is working the way you want it to.

Here are some times when you should re-automate your finances.

When You Have a Big Life Change

Expecting a baby? Recently laid off from your job? Got a promotion and a big raise?

Life is full of change, and when you have an occasion that greatly affects your financial situation — you need more money, you’ve got less money coming in, etc. — it’s time to make sure your finances are working for the same thing you are.

If you’ve been laid off and need to horde cash, you may want to stop contributing to your Roth IRA until you’re back on your feed. If you’ve just switched jobs and are going to be making more money, ramp up your savings or investing goals and don’t let that extra cash go to waste.

When You’ve Shifted Your Financial Goals

Ready to throw a lot more money at your mortgage? Need to start saving for retirement? Finished paying off your debts?

The best feeling in the world is when you’ve finished a financial goal or are starting to focus on a new one. It’s at these times you need to re-asses the system you have in place and ensure it’s working toward your new goals.

For example, if you’ve been automatically socking aside money each month for your emergency fund, when you get to your target number, you may want to start boosting your retirement savings or start a new savings account for a short-term goal, like a house downpayment or new car.

This isn’t rocket science, but it’s worth remembering that your money will only do what it’s told, so if you’ve got a big life change that requires some adjustment, take a look and see if your money needs some new direction.

You don’t necessarily need to adjust every aspect of your automatic finances — your bills should still pay themselves and your spending should still be tracked online, for example — but make sure your money is doing what you want it to and that you’re working toward the same goals.

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