Money Dates: Financial Routines For Good Money Habits
My morning routine is far from being influencer-worthy, but it works. Most days, I scroll on my phone for a bit, roll out of bed, drink coffee, and do low-lift tasks like emails. Then when I’m properly caffeinated, I move my body, shower, and start my day. While it may not be glamorous or Instagram-worthy, it's a ritual that works. And just as I've embraced the power of routine in my morning rituals, I've discovered its transformative power in managing my finances, doing my best to be as low-lift as possible.
Personal Finance Routine
A money routine, personal finance routine, money date, or money check-in is something that you do on an annual, quarterly, monthly, weekly, or potentially daily. My personal finance routine is as hands-off as possible. This is my preference for many reasons, firstly, because my financial archetype is Blissfully Indifferent. Secondly, there are so many other ways I’d rather use my time, even if it is binge-watching Below Deck Med. In all seriousness, my finances being more or less on autopilot is a privilege that I can engage in because I’m earning enough to automate without being fearful of overdrafting. My personal finances weren’t always this “set it and forget it” (more on that later), but even with a hands-off approach, I still have an intentional money routine to help me stay on track with my goals and tweak them as needed.
To paint a car parallel, on an annual basis, I make sure my insurance and registration are updated and likely do larger things like replacing air filters, whereas weekly tasks are more like putting gas in the car and recycling whatever cans and bottles have accumulated. This is where a money routine comes into play. If you’re ready to start a money routine for yourself, keep reading! I’ll start out high-level, zooming out with the annual plan, and end by sharing with you what I do more frequently. This isn’t meant to be prescriptive, it’s meant to lift the veil off of what I do with my money routine and invite you to borrow what works or find inspiration to create your own money routine.
Setting the Stage for Financial Success
First, get in the right physical and mental space before looking at your money. At the heart of my money date lies the importance of setting the stage for success. Whether I'm cozying up with a hot mug of tea or retreating to a quiet corner with my laptop and a mocktail (just like I recommend in my book, The Financial Anxiety Solution), finding the right physical space allows me to focus on my financial goals without distraction.
When it comes to money, security also matters. While you can do overarching financial dreaming and goal-setting in a public place, I recommend avoiding shared Wi-Fi when doing sensitive financial tasks, such as logging into a bank, credit card, or retirement accounts.
Annual Financial Review Checklist
It might seem counterintuitive to start big, but I like to do the annual deep dive—a comprehensive review of my income, expenses, and long-term goals. This yearly ritual serves as a checkpoint for assessing my financial progress, identifying areas for improvement, and ensuring that essential life planning such as insurance and estate planning are up to date. I also make sure my paycheck routine is in place to support my annual goals.
During this deep dive, I reflect on what worked well in the previous year and what areas may need adjustment. Whether it's reallocating funds to align with changing priorities or exploring opportunities for growth and investment, this annual review sets the stage for a successful financial year ahead.
Annual Checklist:
Set Annual Goals: Define financial goals for the year, such as saving for a down payment on a house, paying off high-interest debt, starting a CD for a vacation fund, or increasing retirement contributions.
Tax Planning: Review your tax situation and consider any adjustments to optimize tax efficiency, such as contributing to retirement accounts or taking advantage of tax deductions and credits.
Review Insurance Policies: Assess your insurance coverage for health, life, auto, and home, and make adjustments to make sure you've got appropriate protection.
Ensure Will and Trust are up to date: This is extremely important if you have children, a partner, own a home, or care for a disabled adult.
Paycheck Routine: Setting up a paycheck routine or ensuring it’s still appropriate
My Automated Paycheck Routine
👀 BTS 👀 Here’s a little more on my paycheck routine: My paycheck routine is an automated system where I turn on autosave when my paycheck hits. This means that I treat my savings goals like a bill. Instead of saving whatever money I have left over at the end of the month, I start the monthly by funding my savings goals. This means that my savings are on autopilot, and the money in my checking account can be used for moments of spontaneity, too!
On the day after my paycheck hits my checking account, I have money automatically move from checking into several different savings accounts. (I use ally bank currently, but I’ve done this in the past as a credit union member, too). Each of these savings accounts has a name corresponding to its goal. For example, when my partner and I were saving money to fix up our basement, one of the accounts was called “Basement.”
I generally save for several things at once, because my emergency fund is fully funded, and some of my savings accounts are sinking funds. A sinking fund is money saved regularly for things that happen irregularly. Think: home repairs, new tires, or replacing worn furniture. These are expenses that pop up, but not on a regular basis where you can build it into your spending plan, like a streaming service or an annual membership fee. Other sinking fund ideas are: vacations, pet adoption fee, new TV, gifts, tattoo, and spa day. The possibilities are endless!
Back to the paycheck routine: I’m paid, then the next day, money moves from my checking into several savings accounts. This paycheck routine means that I’m automatically funding my goals, and don’t have time to A) stress about how much I should save or spiral over what’s the best use of my income and B) spend my money before I can fund my goals.
If you don’t have an automatic paycheck routine set up I highly recommend it! If you are just starting out with a savings plan, start small. Set up autosave to take $20 from your paycheck and move it into a savings account for an emergency fund. After a couple of months, increase the amount you’re saving in your emergency fund or add on another savings account for something fun like a cooking class you’ve been eyeing.
Quarterly Check-Ins: Staying on Track
In addition to the annual deep dive, I incorporate quarterly check-ins to ensure my finances stay on track. These regular reviews allow me to assess my progress, make any necessary adjustments, and course-correct as needed. Whether reviewing credit card statements, ensuring I'm still aligned with the goals I set for my annual review, or exploring new opportunities for financial growth, these quarterly check-ins help me stay proactive and engaged in my financial journey.
When I talk about "financial growth" in this context, I mean committing to learning more about a particular financial tool or skill I feel a little shaky about. This growth piece is why I'm passionate about recommending resources to help individuals better understand money management. One resource that I wholeheartedly endorse is Amanda Holden's "Invested Development" course. Amanda, aka the "Dumpster Dog," is a former investment banker turned retirement investment educator. With an emphasis on empowering those usually forgotten in personal finance, she has a way of threading the needle that allows you to understand investing without feeling like you're watching paint dry. It's accessible, funny, and deeply enjoyable! I went through Amanda's course a couple of years ago and recommend it to everyone interested in gaining the knowledge and confidence they need to make informed investment decisions and achieve their financial goals.
Quarterly Checklist:
Review credit cards: Are the ones with an annual fee worth keeping, or is it time to downgrade?
Review credit report: Make sure everything on your credit report is correct.
Review retirement investment allocations: Can you contribute more?
Revisit Spending Plan: Reassess your spending plan and make changes if your financial situation or goals have shifted.
Financial Education: Do I need to learn more about investing? Retirement? Saving for college?
Monthly Maintenance: Keeping Things Running Smoothly
On a monthly basis, I examine my day-to-day finances more closely, ensuring that bills are paid, savings goals are met, and investments are on track. This monthly maintenance routine is a crucial checkpoint for monitoring cash flow, identifying discrepancies, and ensuring that my mostly hands-off money machine is running smoothly.
Monthly Financial Checklist:
Sinking funds on autosave
Retirement on autosave
Bills are on autopay
Expenses haven’t crept up OR your savings plan has been modified for new expenses
Weekly Reflections: Celebrating Wins and Practicing Gratitude
While I don't adhere to a strict daily money routine, I do incorporate weekly reflections to stay mindful of my financial habits and goals. Whether it's celebrating small wins, practicing affirmations, or exploring new opportunities for financial self-care, these weekly reflections help me stay grounded and motivated on my financial journey.
Additionally, for those looking to explore the intersection of personal finance and lifestyle, I highly recommend Holly Trantham's book, "Beyond Getting By." This is The Financial Diet's second book, and as the title suggests, a great next step once you've got the basics of your money down, like tracking your income and expenses.
Good Money Habits
Reflecting on the importance of routine in my financial journey, I realize that these habits weren't always in place. It took time and lots of trial and error to get to this point. Wherever you are on your financial journey, know that you've got the capacity to create your version of good money habits and personal finance routines.