Automate Good Habits and Create Templates
Barbara O’Neill, Ph.D., CFP, Extension Specialist in Financial Resource Management
Karen Ensle, Ed.D., RD, Family and Community Health Sciences Educator
Rutgers Cooperative Extension
“We are responsible for our own life-
No other person is or even can be.”
The great American poet Carl Sandburg once said “The time for action is now. It’s never too late to
do something.” Have you been procrastinating on taking action to improve your health and finances? If so, there’s a simple solution to your inertia: automation. Automation is the perfect antidote for procrastination
because it reduces the number of decisions you need to make. As David Bach, author of The Automatic Millionaire, notes “Do it once- the rest is automatic!”
In other words, you take positive action at the outset (e.g., to choose a weight loss plan or authorize
payroll deductions for your 401(k) retirement savings plan contributions) and then the system works for you
without the need for continuous thought and discipline. Automated behaviors increase the likelihood of
success because many people are simply too busy, or too undisciplined, or both, to oversee their diet and
finances on a daily basis.
So how do you automate good health practices? By putting them on a regular schedule or following a
predetermined plan. Below are some examples:
Automated Health Improvement Practice Examples and Description
Personal Exercise Routines ? Start a habit of walking 15-30 minutes on your lunch hour.
Encourage co-workers to join you to make it more fun.
? Block off “dedicated time” for physical activity and consider it a
normal part of your daily routine to exercise at this time.
? Combine exercise (e.g., treadmill or elliptical trainer) with
watching your favorite television shows so you can do both
Weight Loss Programs An example of diet automation is Weight Watchers’ POINTS?
plan where each food has a point value. People following this plan
can eat any food they want as long as they stay within their daily
point “budget.” Not surprisingly, nutritious foods are low in point
values to guide users toward healthy food choices. Plan participants
do not have to research and count food calories because the point
plan structure effectively does this for them.
Packaged Meal Products (e.g., Shakes) Products such as Instant Breakfast? provide portion-controlled meals and snacks. Specific products include shakes, meal bars,
snack bars, and powders. Advantages of these “meals in a package” include convenience and clearly defined servings. A can of Slim-Fast? Rich Chocolate Royale, for example, contains 220 calories
and a percentage of the recommended daily allowance for a number
of essential nutrients. Disadvantages include lack of variety over time and a relatively high cost compared to a home made meal. Six
cans of Rich Chocolate Royale cost approximately $9. This is a
three-day supply because the Slim-Fast? weight control plan recommends eating two Slim-Fast? meals a day, along with healthy snacks, exercise, and a sensible third meal. The annual cost of two
shakes per day would be approximately $600 (365 divided by 6 =
61 packages per year x $9 apiece, plus sales tax).
Routine Health Screenings The key to staying on schedule is to mark the dates for key health
screening exams (e.g., annual physical) on your calendar so you can
keep appointments scheduled at their recommended intervals.
Programmed Express Workouts A number of health clubs, such as Curves For Women?, offer 30-minute circuit training workouts using a variety of hydraulic
resistance machines. Billed as a way for clients to fit exercise into a
busy schedule, these express workouts include stretching and
strength training. The exercise routine is programmed in advance and users simply work their way around the circuit. There is no
need for users to purchase any equipment or develop their own
exercise routines. Like any health club facility, the cost of an
express workout facility may be a challenge to some potential users. Those who use the service the most will pay the least on a cost-per-
Meal Plan Templates There are many places (e.g., dietitians, reputable nutrition Web
sites) to get “template” menus based upon recommended dietary
guidelines and a user’s daily caloric intake. The basic meal plan is
already pre-configured. Then all someone has to do is choose a
specific food (e.g., one medium fruit, or 3oz of broiled chicken or
fish, or ? cup cereal) that fits the template menu. Meal plan templates are available from www.mypyramid.gov.
There are also a variety of ways to automate one’s personal finances and put saving and investing on
automatic pilot. Financial planners often use the term “pay yourself first” (PYF) to describe a disciplined
savings habit where savings are deposited from a worker’s gross income before the money can be spent. A
good analogy for PYF is the withholding that is done automatically for income taxes (unless you are self-
employed and must do your own withholding). Just like the government deducts taxes from your gross
income, you can choose to have money for saving and investing deposited as an “expense” in your household
budget. “Think of it as a bill you owe yourself,” says the National Endowment for Financial Education?.
Below are ten specific financial automation strategies:
Automated Financial Improvement Practice Examples and Description
Tax-Deferred Retirement Savings Plans Authorize payroll deductions for a tax-deferred 401(k), 403(b),
or 457 plan. If employer matching is available, try to save at
least the amount that will earn you the maximum employer
match (e.g., 6% of pay). If you can afford it, try to take full
advantage of tax-deferred accounts and contribute the maximum
amount allowed by federal tax law. If you start a new job and
your employer automatically enrolls you in a 401(k), don’t opt
out. Instead, raise the low initial “default contribution rate” to
the highest percentage of pay possible.
If available through your employer, take advantage of Save More Tomorrow Plans
retirement savings plans where you can sign up in advance to (Automatic Contribution Increases)
have your tax-deferred retirement savings plan contributions
automatically increase every time your pay increases.
Employer Credit Union Authorize payroll deductions for deposits to a credit union.
This money can be used to save for short- and intermediate-term
goals such as an individual retirement account (IRA) deposit or
the down payment for a new car.
Automatic Portfolio Re-balancing If available through your tax-deferred retirement savings plan or
brokerage firm, sign up to have your investment portfolio
weightings automatically reviewed and re-balanced to their
original percentages (e.g., 60% stock, 20% bonds, 10% real
estate, and 10% cash assets) at least once a year.
Automatic Stock and Mutual Fund Deposits Sign up for automatic investment plans (AIPs) where you pre-
authorize periodic debits of a bank account to purchase shares
(e.g., $50 per month). Often, when investors sign up for an AIP,
they are allowed to invest smaller dollar amounts than if they
hadn’t selected this option. AIPs make investing more
affordable for investors with small dollar amounts.
Automatic U.S. Savings Bonds Purchases Authorize payroll deductions for deposits to purchase U.S.
savings bonds if your employer sponsors a purchase plan.
Another automatic option is the Federal Reserve’s Treasury
Direct plan. For more information, visit
Automated Bill-Paying To save time and money writing and mailing checks, use
automatic bill paying for fixed expenses such as a car loan.
Automatic Checking Account to Savings Many people find that money slips through their fingers if it is in
Account Transfers a checking account that can be accessed with checks or a debit
card. Automatic transfers to savings can help avoid this.
Target Retirement Date Mutual Funds These are mutual funds with a future date in their title, such as
the “Retirement 2025 Fund.” Target-date retirement funds are
generally packaged in five or ten year increments through 2050.
The fund invests in what it considers to be an appropriate asset
mix for each target date and automatically adjusts the mix to a
more conservative profile as shareholders get closer to
retirement. Many major mutual fund companies, such as T.
Rowe Price, Fidelity, and Vanguard offer funds of this type.
The asset allocation weightings and fees can vary among
investment companies, however, so a careful reading of the
prospectus for funds you are considering is in order.
Financial Templates Financial planning maintenance tasks, such as calculating net
worth, analyzing investment asset allocation percentages, and
preparing a spending plan (budget) are easy to update with
computer software programs such as Intuit’s Quicken and
Microsoft Money. Another option for quick financial
calculations is creating a spreadsheet in Microsoft Excel.
Several Microsoft Excel spreadsheet templates can be found at
Use the Automated Health and Wealth Strategies Worksheet, below, to identify planned actions. List up to
five automated strategies that you plan to use to reach your health and wealth goals.
Automated Health and Wealth Strategies
Health Goal Wealth Goal
? Eat at least one meal per day by following a healthy meal template based on dietary guidelines.
? Select an automation strategy to incorporate regular physical activity into your daily routine.
? Start or increase deposits to an employer retirement savings plan or credit union via payroll deduction.
? Select an automated investment strategy for individual investment accounts (i.e., those that are not
available through work).
? Use a computer financial template or software program to track your financial progress.
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