Saving money is something that many people struggle with, and if you find it challenging, you are not alone. It’s easy to keep less than you meant to each month inadvertently. Still, automation is one way to ensure you stay on track and do not spend more than you were intending. It has several advantages.

Moving Your Budget Around

Automating is a great idea, but what if you don’t have enough room in your budget to set aside a portion of each paycheck? The good news is that most budgets can be tightened to allow for savings. Perhaps you’ll decide to cancel streaming subscriptions and instead check out movies or TV shows from the local library. Or perhaps you will begin basing your weekly menu around the grocery items on sale that week. If you have debt from school, now is the time to refinance it with a private lender. One of the advantages of doing so is that you can reduce your monthly expenses significantly. Consider using a student loan refi calculator to see how much you can expect to pay each month. That way, you’ll be better able to plan for the future.

How Does Automation Work?

You have a few options when it comes to automation, but one of the most important things is to have realistic goals set in place. Create a tight budget and figure out the maximum you can set aside every month. Once you have determined that, you can decide if you want to live by the tight budget or allow a bit more wiggle room. If you have an existing bank account, you can create an automatic transfer from the checking account to the savings account. Another option is to split a direct deposit paycheck between savings and checking. Make sure that you are aware of any fees associated with account ownership. For example, by keeping a minimum balance in some, any monthly expenses might be waived.

Tracking Your Progress

Once you have set up automation, it is time to track the progress and make any necessary adjustments. For example, find that you consistently spend less on transportation each month than initially planned. It may be time to adjust that category in your budget. On the other hand, if you find you are consistently exceeding the food budget, you may need to add more to that category even when looking for sales.

It’s best to start small and work your way up, so you are consistently setting something aside each month. In the beginning, you may only put aside about five percent of the paycheck. Then you could gradually increase that until you have reached 10 to 15 percent. Still, try to be flexible. It is designed to be automatic, but if your household income increases, you may want to increase the amount you’re setting aside. Don’t forget to check in every once in a while to see how the account grows every month. Remember, it’s best to avoid using these savings until you have reached your goals. That’s especially true if your account offers compound interest.