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Plan Well, Retire Well

Saving and investing your money

Old Habits & New Technologies; New to Me, Anyway


This week we welcome Michael Rupured, Financial Management Specialist from University of Georgia Cooperative Extension, as a guest blogger to Plan Well, Retire Well. We hope you enjoy his post as much as we do!

I've always been the kind of person that balances my checking account every month. The habit started when I was in college. When every penny counted, the last thing I needed was a bounced check charge--or ten. Have you ever bounced just one check? No. They come in runs.

Fortunately, it's been ages since I've bounced a check. But the money management habits I developed during those early, poverty-stricken days persist. The differences are mostly the result of technology.

Before I get into the particulars, let me say that I have been slow to take advantage of the available technology. I hear horror stories every day about identity theft, hacker attacks on big company databases, and problems folks have had after using some of these new options. Better safe than sorry. I'll wait to make sure they've worked out all the glitches before providing my personal and account information to the digital universe.

Take Direct Deposit. Were it not required by my employer back in the 70s, I might never have tried it. Give me a paper check that I can take to the bank and cash. That way I know the money is there. I've used Direct Deposit for my paychecks since 1977, and so far (fingers crossed), it's worked every time. Now I have anything possible direct deposited.

ATMs were the next big innovation. The timing was bad--I got my first ATM card around my 21st birthday and for some reason, often forgot to record transactions made after the bars closed. After paying several hundred dollars in bounced check charges, I finally learned to stick the receipt in my wallet along with the cash so I could record the transaction in my register.

When debit cards came along, my habit of hanging onto receipts until they were recorded in my checkbook register came in handy. Around the same time, I bought my first home computer and started using the money management software that came with it. Balancing my checkbook was much easier, and I got in the habit of balancing all my accounts each month--credit, savings, and investment.

Now I have to have some kind of money management software. The list of upcoming bills I've always used is automatically generated rather than handwritten on notebook paper. My favorite feature is the ability to see my net worth at any particular moment, and the ability to see how my net worth has changed over time.

When I bought the Macbook Air, I had to get the latest version of the money management software I use. Hate it. I've learned to maneuver around, but basic tasks are a lot more complicated than with earlier versions. I ended up linking the software to my investment accounts for automatic updates because I could never figure out how to balance those accounts manually.

I'd been sitting down a couple of times a month to write out checks for all my bills. I have some automatic payments set up, but am really not a fan. In some cases they can be hard to stop, and it can be difficult to resolve an issue when they've already got your money. I handled transfers between checking and savings accounts over an automated phone line.

The way the new software reconciles accounts really doesn't work with the way I handle my checking account. The difference between the balance shown in the software and what the automated phone line said continued to grow until I finally set-up online access and linked my checking and savings accounts to the software. Wow! Talk about life changing!

Balancing my accounts takes about thirty seconds. I don't have to worry about keeping and recording receipts--the transactions show up in the next day or two. In fact, recording them increases the likelihood of duplicates. So I just wait--if I get a receipt at all. The first few times, my heart pounded as I walked away without getting that receipt.

The most recent old habit to bite the dust is sitting down once or twice a month and writing checks for all the bills. I have to have special UGA checks with the Georgia Bulldog on them and the official school logo. They cost a fortune but it's just one of those things you do. Throw in a stamp for every bill and my old way of paying bills was getting expensive.

I was reluctant to use the automatic bill paying service from my bank that came with online access to my accounts. After paying about $125 for more checks and another roll of stamps one month, I was motivated to look into the service more closely. Once I determined it was absolutely free, I gave it a try. That was more than three months ago. Now I'm hooked. Instead of sitting down once or twice a month, I go online and set up the next payment the day I get the bill and forget about it.

Yeah, I could set them up as recurring payments. Maybe one day I will. But for now, the idea of putting my finances completely on autopilot is too disconcerting for this old control freak to contemplate.




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COMMENTS



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Online bill pay is a terrific time saver, just for the reasons you stated. For recurring bills that are always the same amount, I do love automatic payments, but the key is to set them up through YOUR bank, not each individual company. That makes it much easier if you ever have to change banks, have a dispute about a bill and don't want to pay it until its resolved, or make other adjustments. The companies try very hard to lure you into setting up automatic payments with them. And, why wouldn't they, since it puts them in control of your money?
by Ann Hodson on Wednesday 10/31/2012

Thank you for your comment. I agree that the key is finding what works best for you and then letting technology help you!
by Kathy Sweedler on Friday 11/2/2012