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How to think about your money for less than an hour a month

Money can be scary, especially if you don’t know where to start. If you’ve got an emergency fund, you’re ahead of the game – only 39% of Americans can handle a $1,000 emergency. But is your emergency savings just sitting in an account or are you adding to it? What about your retirement?

“At heart, I think most of us are lazy… especially about the things we don’t really like,” says Ramit Sethi, a New York Times best-selling author and founder of “Automation allows us to take advantage of our natural tendency for laziness. I spend less than one hour a month on my money.”

Set it, and forget it. It’s good investment advice, but it works with your everyday finances, too.

“You want to think of your money almost like an email inbox. Your money comes into your checking account once you get paid,” says Sethi.

Connect your checking account to your savings account, your retirement accounts and any other account you’re trying to beef up, then set up automatic transfers. These can be weekly, monthly, quarterly — whatever makes sense for your budget. Set up automatic payments for your credit cards and other regular expenses. Once you get the hang of it, what’s left will be what Sethi calls “guilt-free money.”

“I really love guilt-free money because that is money you can spend on whatever you want,” says Sethi.” You want to buy a $20 cup of coffee? Be my guest. You want to spend $1,000 on a beautiful leather jacket? Be my guest.”

How do you actually set it up?

The first step is arguably the most painful: listing your accounts. Sethi estimates it will take up to three hours.

Get a pen and paper, and start writing out the balances of your checking account, your savings account, your IRA, etc. Write out what you owe on all of your credit cards, your mortgage, your student loan debt. This will help you figure out exactly where your finances stand.

Then start linking. Set up autopay for bills and credit cards. Figure out how much you want to spend each month, and set that as the amount to auto-pay. This will help you stop overspending and save you money in the long run by avoiding interest. Set up an automatic transfer from your checking to your saving — maybe it’s only $50 a month, but something is better than nothing.

Sethi proposed using what’s known as “sub-savings” accounts. His first sub-savings account? “Stupid mistakes.”

“About once every 18 to 24 months I got a traffic ticket,” Sethi said. “So instead of just getting sideswiped by those fees, I started planning proactively.”

A sub-savings account is basically a ledger within your savings account. Think of the overall account as a pie and the sub-savings accounts as pieces of the pie. They’re not offered by every bank, but you can build your own in a spreadsheet and keep track that way. Sethi says it’s a good way to break up the money you have in savings to think about building it toward something.

“I’m talking about big purchases like weddings, engagement rings, homes, and even emergencies and dumb mistakes,” Sethi wrote in a blog post.

Automation allows you to check yourself.

“In our worst of moments we’re going to make impulsive, irrational decisions about money,” Sethi says. “We need to build a system to protect ourselves from that. Let’s reduce all this emotional anxiety, and let’s do more of the good instead of worrying about [doing] less of the bad.”