Being the efficiency fanatic that I am, I am often amazed at how people don’t do even the most basic things to automate and modernise their finances or just save time in their lives. A lot of this is habit (it’s programmed into their brains through repetition so they don’t even think to reassess how it is done), and at other times people know how they can streamline things but they just don’t like change.
But if you’re serious about improving your finances, and improving your lifestyle, then you really don’t have any excuse for not taking the following steps. You’ll save a stack of time and a stack of stress, and a whole area of your life will just about be on autopilot.
1. Build up a cash buffer
So often people resist automation of their finances as they are worried that any automatic payments will leave them overdrawn. If you have the discipline to save up a small buffer (it only takes $1-2k depending on your circumstances) then you can save yourself a lot of time and worry.
I’m going to assume that because you are reading this blog you have the discipline to save up this cash buffer so this can’t be your excuse for not embracing automation.
2. Arrange to have regular bills paid automatically
For regular bills like telephone, electricity, gas, internet, council rates, water rates and insurance, contact these organisations to arrange for them to be paid automatically via your rewards credit card. Obviously you want to review your credit card statements when they come through to make sure you aren’t overspending (and haven’t been overcharged) as well, but you would have always done that anyway wouldn’t you?
3. Arrange to have your credit card paid off automatically
Contact your bank to have your credit card paid off automatically by the due date, which will avoid any late payment fees or interest. This is a once-off form and is very simple to complete.
4. For bills that you don’t want to pay automatically, use BPay View
Readers outside Australia won’t even know what BPay is, and many Australians won’t know what BPay View is.
To explain, BPay is a payment method that allows you to pay bills using a biller number and reference directly from your bank account or via your credit card. BPay is an initiative that is owned by Australia’s Big 4 banks, with businesses that accept BPay paying a small fee (which is much lower than credit card merchant fees) to cover costs, and use by customers is therefore free of charge.
BPay View is a newer initiative that, once set up, sends your bills electronically to your internet banking, and when you log into internet banking you can then view and schedule payments for these bills.
BPay View has been advertised as a feature that will greatly reduce the number of invoices going through our traditional mail system, and this is something that I am a big supporter of as can be seen in my post on going paperless.
See here for more detail on BPay View.
5. If you need to pay money to a friend or work colleague, pay it electronically
In the old days, when one of my siblings would buy a present for Mum or Dad’s birthday, we would split the cost and have to arrange to exchange cash to square things up. But that was years ago, and with internet banking we instead just transfer cash using EFT (Electronic Funds Transfer). Not only do I not have to withdraw the cash, but I also have a record on my bank statements of where the cash actually went.
This makes it much easier to make the payment, and also to track where all of my cash is going.
Obviously if anyone needs to pay you then request that they pay you electronically also.
6. Avoid line-ups
Offices for organisations like the RTA/VicRoads (equivalent of the USA’s DMV) and banks are notoriously shocking for line-ups and waiting times, and the situation doesn’t seem to be improving. I therefore do everything I can to not go into their buildings, but when I have to (usually for something out of the ordinary) I am amazed at the number of people that are lining up for the most basic tasks.
Banks and our vehicle registration bodies have put so much effort and resources into enabling you to achieve just about everything without going into their branches, so if you are faced with dealing with these organisations it really does pay to investigate (online of course) how you can avoid going in there.
For banks, even if you can’t do something over the internet, you can usually do it over the phone, and the with vehicle registration bodies things like re-registering your car can be done via their websites.
Line-ups are for suckers and mean that you will be unnecessarily congregating with some of the most technology-illiterate and inefficient people in society for your entire lunch hour.
7. Avoid using cash
I don’t really use cash for transactions now, with the main exception being on the rare occasion that I am down at the pub having beers with the boys. Otherwise I put everything on my credit card so that it can be easily tracked.
The introduction of contactless payments (via Near Field Communications or NFC technology) like Visa Paywave, MasterCard PayPass and American ExpressPay has meant that payments via credit card for amounts under $30 just require you to wave your card over the payment terminal and the payment is done. No swiping or inserting your card, and no requirement to enter a PIN. As a result, payment of small amounts via credit card is very practical, and many businesses are no longer enforcing the “$10 minimum”.
Not only is it easier to use you cards to make payments now, but the transaction appears on your statement making it much easier to track, thereby saving you time overall. And with contactless payments now being enabled in smartphones (like the Westpac/Samsung Galaxy S4/S5 partnership), you can even pay via your credit card with your phone!
Tracking transactions paid for in cash is much more difficult and requires much more discipline, so if you are serious about tracking your spending then changing the way you pay can save you a lot of time.
Do you have any tips for improving efficiency in finances?
What are your tips for increasing efficiency in finances? Is there anything special that you do that you believe could increase efficiency for others?