How to design your financial routine?
Here’s a basic financial roadmap I use to keep track of all the related to-dos. I know we can keep our investment automated, our savings automated and even our bills automated but for me, there is still a lot of active tasks in managing the month-to-month finances. And I do them to get more cash, have better results to show at the end of the month.
I use Google calendar for the last few years to get things done but you could use any reminder list. The idea came when I need a calendar that is usable across my phone, iPad, notebook, editable offline, and free forever (fingers cross).
Step 1: List down the financial things that you need to do
List down all the financial things you need to do, e.g., issue an invoice, cash in a voucher, a bill to pay, an allowance to give, fund investment, a trip to the bank, file taxes. Remember those errands that you need to do yearly or even longer.
Step 2: Identify the dues and if the task is re-occurrence
Unlike my dad, who pays every bill he gets on the spot (he fears forgetting), I love holding on to cash as long as I could. I would even chart out to get interest gain from a fixed deposit before paying a credit card. Note down the cut-off date, due date, and how frequent.
Step 3: Find easier ways to get it done
The best rule is to eliminate, simplify, automate, and do bigger things. Easier said than done. Not every financial system or app can integrate, and sometimes, you want to safeguard your money by NOT setting auto-top-up. I currently do two things to make things simpler.
One: Automate StashAway investment and a fixed bill (insurance because of the rebate).
Two: Set all the payment accounts as a favorite so that I don’t need to dig and type the numbers every time.
It may be worthwhile to find a bookkeeper if you are a freelancer.
Step 4: Assign the task in your calendar
I have not yet reached a point where I have a personal assistant, so I need a reminder of everything I need to do manually. Because the way Google Calendar is built, I put these tasks as re-occurring events (would be perfect if their task and reminder have a more sophisticated function). Reminder to pay rent every 15th of the month, credit card payment, e-wallet top-up (for cashback), driving license (once every three years).
Always write to remember. Put in the details, so your brain doesn’t need to. For the event title, instead of “Pay Rent,” put “Pay Rent RMxxx to XX.”, use discount code “XXX”. Mark any items that would qualify for a tax deduction so you’ll remember to keep the receipts.
Step 5: Edit as you go
Update when there are significant changes like if you get a new credit card or have a new payroll day. I’ll assign any new task to my calendar or delete the ones that are no longer relevant. Keeping the list updated means, I won’t feel like I need exhaustively re-look into everything.
Step 6: Daily record (if you need)
I think recording every transaction you made is an option. It depends on where you are on your financial journey. If your spending makes very little difference to your wealth, there’s no point in putting every number down. We aren’t living in a world of the matrix. Perhaps measuring other things are more meaningful to you. If you have consumer debt or having a hard time saving decently, then expenses record is a must.
Step 7: Periodical review
Every month, I do a financial cleanup and start a new one. Some months I get breakdowns. It could be work or a car or some family demands, and I want to get off the dirt and grease and grime that comes with it. My review is simple; I used to write money diaries. Now, I put three numbers into an Excel sheet: The income, spending, and saving of the month. I’ll see the trending chart and can anticipate where I am heading towards the end of the year. From there, it’s a fresh start; I can start buying my daily latte.
If you are a family, you may want to set some time to discuss how you feel about the family finances or what’s the family next big financial plan. Keeping the family in the loop helps everyone to be on the same page.
Stress not, success will come
The thing about routine is you can sometimes forget to do something, but its okay; when you have planned it, there’s always next time to act. As I have learned the hard way, and now TPC philosophy, personal finance is action bias – the more you practice, the better you get.