Automating your personal finances can greatly simplify managing your money and improve your financial health. The most obvious wins with automation are the financial wins – automation ensures you stay consistent with payments and savings, helping you avoid late fees and always contributing to your savings without needing to think about it.

Additionally, by setting up automatic bill payments and savings transfers, you save a lot of time. This can free you up to live your life instead of spending it on lifemin! What's more, automation reduces stress as you no longer need to remember due dates or worry about missing payments.

There are some cases in which automation may not be for you, especially if you have challenges maintaining a positive cashflow and have a lot of consumer debt. In this case, it may be worth talking to a financial councillor to help you get a handle on your money. If that's not the case, automation may be right for you!

Automated tools that track and categorise your spending provide a clear picture of your expenses, making it easier to stick to your budget. Additionally, setting up alerts for suspicious activity and regularly monitoring your accounts through automation enhances your financial security.

Overall, automating your personal finances can save you time, reduce stress, help you save more effectively, and keep your money secure. This article provides seven steps to make that happen.

NOTE: The ideas in this article provide a hypothetical framework for automating your personal finances. However, they don't take your personalised circumstances into account. For a more tailored strategy, or for specific advice, consider speaking with a qualified financial adviser.

1. Budgeting and expense tracking

Automating budgeting and expense tracking saves time and reduces stress by ensuring consistent monitoring and categorisation of your spending. It provides real-time insights into your financial habits, which can help you stick to your budget and avoid overspending.

Here’s how to do it.

Automating your budgeting and expense tracking

To automate budgeting and expense tracking in Australia, you could:

1. Choose an Australian financial app: Select an app like WeMoney, Frollo, or Pearler's Spending tool.

2. Link accounts: Connect your Australian bank accounts, credit cards, and other financial accounts to the app.

3. Set up categories: Customise expense categories to match your spending habits.

4. Automate transactions: The app will automatically categorise your transactions.

5. Enable alerts: Set up notifications for overspending and important financial updates.

6. Review regularly: Check your budget and spending patterns regularly to stay on track.

Tips for success

- Security first: Choose an app with strong security features to protect your financial information and make sure they use OpenBanking

- Stay consistent: Deliver on the goals you set for yourself, it’s like building a muscle.

- Use support: Take advantage of customer support if you need help setting up or troubleshooting the app.

2. Savings and investment automation

Automating savings and investments helps you contribute towards your goals without constant effort. It also removes the temptation to spend money meant for savings and takes advantage of compound interest over time. Finally, automation reduces stress by managing regular transactions and keeping your investment strategy on track.

Here's how to do it.

Automating your savings and investments

To automate savings and investments in Australia, you could:

1. Choose an investment platform: Select a platform like Pearler (or any platform you trust)

2. Set up automatic transfers: Schedule regular transfers from your bank account to your investment account.

3. Select investment options: Choose investment portfolios aligned with your risk tolerance and financial goals.

4. Monitor and adjust: Review your investments periodically and adjust contributions as needed.

5. Utilise tools: Use tools provided by the platform for automatic rebalancing and goal tracking to optimise your investment strategy.

Tips for success

- Consistency is key: Make regular contributions to your savings and investments, even if they are small.

- Use support: Take advantage of customer support if you need help setting up or troubleshooting the app.

- Educate yourself: Learn about savings and investments through the resources provided by the app or other trusted sources.

3. Bill payment and management

Automating bill payment and management can streamline your financial obligations by ensuring bills are paid on time without manual effort. It reduces the risk of late fees or missed payments, which helps maintain a positive credit history. Automation also provides peace of mind, allowing you to focus on other priorities knowing that your bills are handled efficiently.

Here's how to do it.

Automating your bill payment and management

To automate bill payment and management, you could:

1. Set up automatic payments: Arrange via your bank or utility providers to automatically deduct bills from your designated account.

2. Use bill payment apps: Utilise apps like BPAY or your bank's online banking to schedule recurring payments for regular bills.

3. Enable alerts: Activate notifications for bill due dates and payment confirmations to stay informed.

4. Monitor regularly: Review your bank statements and app notifications to ensure payments are processed correctly and on time.

5. Adjust as needed: Update payment details or amounts as your bills change, ensuring ongoing accuracy and efficiency in managing your finances.

Tips for success

- Consolidate bills: If it suits your circumstances, consolidate your bills to fewer providers to make tracking and managing easier.

- Update regularly: Update your bill information if there are changes, such as a new provider or a change in the payment amount.

- Review regularly: Periodically review your automatic payments and bill management settings to ensure everything is running smoothly and make adjustments as needed.

4. Bad debt management:

If you don’t have any bad debt (i.e. credit card debt that's not paid off each month, personal loans or personal car loans), skip this section!

If you have bad debt, though, read on. Automating bad debt management is essential for regaining financial stability and reducing stress. By setting up automatic payments, you ensure bills are paid on time, avoiding late fees and improving your credit score. It helps maintain consistency in debt repayment, allowing you to focus on strategic debt reduction strategies. Automation also simplifies tracking and monitoring of payments, providing a clear view of your progress toward becoming debt-free.

Automating your bad debt management

If you have bad debt, such as credit card or personal loan debt, automating your debt management becomes even more crucial to regain financial stability. Here’s how you could approach it:

1. Assess your debts: Gather all information about your debts, including outstanding balances, interest rates, and minimum payments.

2. Choose a debt management strategy: Decide on a strategy, such as focusing on high-interest debts first (debt avalanche method) or starting with smaller debts for quick wins (debt snowball method).

3. Use a debt management app: Select an app that allows you to track and manage debts effectively, like PocketSmith, WeMoney, or Frollo.

4. Set up automatic payments: Schedule automatic payments for at least the minimum amount due on all debts to avoid late fees and penalties.

5. Increase payments: If possible, automate additional payments towards high-interest debts to accelerate their payoff.

6. Monitor progress: Regularly review your debt balances and payment history through the app to track your progress.

7. Seek professional help if needed: Consider consulting a financial adviser or credit counselor for personalised advice on managing and reducing your debt effectively.

Tips for success

- Consolidate debts: Consider consolidating high-interest debts into a single lower-interest loan if it makes financial sense.

- Avoid new debt: Try to avoid taking on new debt while you’re focused on paying off existing debts.

- Stay consistent: Make regular payments to avoid late fees and reduce your debt faster.

- Pay more than the minimum: Whenever possible, pay more than the minimum payment to reduce the principal faster and save on interest.

5. Tax optimisation and filing

NOTE: the ideas discussed below are general in nature, and don't account for your individual circumstances. For personalised tax advice, speak with a certified tax accountant.

Automating tax admin can assist with accuracy and compliance while saving time. Automated systems can also potentially reduce the risk of errors in calculations and filing, maintaining your financial records securely. This approach simplifies the complex process of tax filing, allowing you to focus on strategic financial planning rather than administrative tasks.

Here's how to do it.

Automating tax optimisation and filing

To automate tax optimisation and filing in Australia, you could:

1. Choose tax software: Select a reputable tax software like myTax (ATO's online tool), or H&R Block.

2. Input financial information: Enter your income, deductions, and expenses into the software. You can use platforms like Sharesight and Navexa to help you calculate tax information for your investments. Share registries also have information on your dividends and capital gains.

3. Utilise deduction tools: Use the software's tools to maximise eligible deductions and credits.

4. Review and submit: Review the prepared tax return for accuracy and completeness and submit electronically to the Australian Taxation Office (ATO).

5. Monitor status: Track the status of your refund or tax payment through the software's updates.

Tips for success

- Stay organised: Maintain organised records of your income, deductions, and expenses throughout the year to simplify tax preparation.

- Utilise customer support: Take advantage of customer support offered by the tax software provider for assistance with setup, troubleshooting, and tax-related questions.

- Educate yourself: Stay informed about tax laws and regulations that may affect your financial situation, using resources provided by the software or reputable sources.

6. Retirement planning:

Automating retirement planning can help to consistent savings and investment contributions over time. It simplifies financial management by setting up systematic contributions to retirement accounts, reducing the risk of insufficient savings later in life. Automation also provides discipline in maintaining retirement goals.

By automating, you can streamline the process, making it easier to stay on track toward your targets for retirement.

Automating your retirement planning

It’s relatively easy to automate your retirement planning in Australia! In fact, it’s pretty much done for you – but you can choose to optimise. Here's what that process could look like:

1. Choose a superannuation fund: Select a reputable super fund. If you're unsure of where to begin, you can use government comparison resources like MoneySmart or the ATO's YourSuper compare tool

2. Set up contributions: Arrange automatic contributions from your salary to your super fund. This can be done through your employer or through your super fund. It's also worth talking to a financial adviser about which strategy is best for you.
3. Select investment options: Choose investment strategies within your super fund that align with your retirement goals.

4. Utilise government incentives: Take advantage of tax benefits and government co-contributions available for super contributions.

5. Monitor progress: Use tools provided by your super fund to track your retirement savings and adjust contributions as needed.

Tips for success

- Start early: Begin saving for retirement as early as possible to maximise your savings.

- Automate contributions: Set up automatic contributions to your superannuation fund to maintain consistency in saving for retirement.

- Diversify investments: Spread your retirement savings across different asset classes to manage (although never completely eliminate) risk.

7. Security and fraud protection

Automating personal finance security and fraud protection seeks to ensure vigilance against unauthorised access and fraudulent activities. By setting up alerts for unusual transactions and using secure authentication methods, automation can reduce the risk of financial fraud.

Automation also enhances efficiency in responding to potential threats promptly.

Here's how to do it.

Automating your security and fraud protection

To automate personal finance security and fraud protection, you could:

1. Enable alerts: Set up notifications for account activities, including transactions and account logins, through your bank's mobile app or online banking platform.

2. Use Two-Factor Authentication (2FA): Enable 2FA for additional security when logging into your financial accounts, using apps like Google Authenticator or SMS codes.

3. Use a password manager: Use a reputable password manager to store and generate strong, unique passwords for each of your financial accounts.

4. Secure devices: Ensure your devices are regularly updated and use secure Wi-Fi networks when accessing financial accounts to prevent unauthorised access.

5. Automated transaction review: Use budgeting and financial management apps that automatically categorise transactions. Regularly review these categorisations for any discrepancies or unauthorised charges.

Tips for Success

- Secure communication: Use secure communication channels when sharing sensitive information with financial institutions or service providers.

- Stay updated: Stay informed about the latest security threats and best practices for protecting your financial information.

- Seek help when needed: Don’t hesitate to seek help from your bank, financial adviser, or cybersecurity experts if you have concerns about security or fraud protection.

And there we have it! Seven ideas for how you could automate your personal finances. Remember: these steps are general in nature, so for more specific insights, chat to a qualified financial adviser.

Happy automating!