As a personal finance writer, people are often surprised to hear that I’m not a super-strict budgeter. I also feel no shame in applying for an income tax filing extension, and when it comes to investing? I’d much rather leave the whole thing up to a computer program rather than spend precious hours painstakingly researching and selecting mutual funds myself.
And the reasoning behind all of this? I’m lazy. Just as with household chores and regular dentist visits, I don’t want to spend more time thinking about my money than I absolutely have to. I want to feel confident that I’m setting myself up for a bright financial future, of course. But personally, I think part of being good with money is knowing when and how to use your “bad” habits to your own advantage. For me, my laziness is nothing less than a financial virtue.
It’s all about setting yourself up to succeed. “I definitely think laziness can be a virtue if you put the right systems in place,” says certified financial educator and financial coach Maggie Germano. “Being lazy, forgetful or avoidant when it comes to your money doesn't mean you're doomed to miss payments or never save.”
Of course, I’m not advocating to never check your bank account balance or just leave your credit card debt alone in the hopes that it’ll eventually just disappear — when it comes to your money, a laissez-faire attitude can often be a virtue, but ignorance never is. In order to make laziness work to your financial advantage, you have to be smart about it. Here are a few ways to do just that:
Automate, Automate, Automate
You’ve probably heard the term “pay yourself first,” but what does it really mean? For me, it’s simply the idea that the money from my paycheck needs to go towards my goals first, before I spend a penny on anything else for the month. Rather than spending what I want and save what’s leftover, I save a set amount first and spend what’s leftover. If you’re lazy like me, there’s one super-simple way to do this: automate. “If you know you don't like to take financial action, automation is your friend,” Germano explains. “In order to save money or grow your wealth, you can use direct deposit or auto-deductions. Set it and forget it through your paycheck in order to contribute to retirement or build up your other savings.”
You can automate everything from your house down payment or vacation savings to your retirement account. “There are also many robo-advisors and apps that you can use to save or invest your money in the stock market,” says Germano. “You can either use a round-up function, or set up a monthly contribution. This way, you're saving and/or investing without even needing to think about it. Win-win!”
Germano also advocates for setting up auto-pay for your credit card and other bill payments. That way, you never risk missing a payment and dinging your credit score — or racking up even more debt in the form of interest.
Make More From Compound Interest
As discussed, automating your accounts is a great way to make sure you’re investing in the first place. But laziness can be a boone to your investment strategy even beyond that.
How, exactly? It’s a tale as old as time: through the power of compound interest.
“The ultimate lazy investing secret is compounding your wealth,” says Professor Alexander Lowry, director of the Master of Science program in Financial Analysis at Gordon College. “Compound interest is the eighth wonder of the world. Compounding is the safe road, the sure road, and fortunately, anybody can do it. To compound successfully, though, you need time. Compounding only works through time.”
So how do you make compounding work to your advantage? Invest your money, and then leave it alone — don’t sell off your assets at the first sign of a dip in the market. And while it’s super important to build up that emergency fund, don’t think that only having cash is going to carry you through your twilight years comfortably.
“You can’t compound holding only/mostly cash,” Lowry explains. “Cash is a wonderful asset to hold during times of crisis. It’s also great for a short-term goal, such as keeping money safe for a house down payment to be made within a couple years. But cash is not a long-term investing strategy.”
Of course, you will want to continue contributing to your retirement account and other long-term investing accounts throughout your working years. But once you make those contributions, do your best to leave them alone and let years of interest-building work in your favor.
The One Caveat To Financial Laziness
There are plenty of other ways to make laziness work to your financial benefit, too. For example, if you want to keep an eye on your credit score but don’t want to dedicate all that much time to doing so, set up credit monitoring. Most major credit bureaus offer these programs, either for free or a small monthly payment. Many banks and budgeting apps (like Mint) also offer free credit score updates on a regular basis so you can stay on top of your financial health without really having to think about it.
But there’s a big caveat to financial laziness that I would be remiss not to highlight: to get a big payoff later, you must put in a little bit of effort at the beginning. For example, automating your savings won’t work if you don’t leave yourself enough to cover your basic necessities and therefore end up withdrawing everything you “saved” anyway. You need to take the time to track your spending, come up with a reasonable budgeting plan, then decide on an amount you can afford to part with each month.
However, that little bit of leg work will be worth it. After you’ve put the right systems for your financial situation in place, getting where you want to be won’t feel so unattainable.
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