smart spending

12 days of financial gift giving

Automatic transfer
Automatic transfer

On the sixth day of Christmas, my true love gave to me, the ability of automatic transfer.

Once a young person masters the mechanics of checking and savings account management, it's time to introduce him or her to the gift of automatic transfer, which allows one to move money online from checking into savings, a money market account, CDs and individual retirement accounts on a scheduled basis.

"The reason that's important is, you get into the habit of paying yourself first and setting goals, whether long-term or short-term," says Seaman. "It doesn't all have to be about retirement savings. It can be transfers to another savings account for short-term goals like buying a car or a down payment on a condo or a vacation. It's a great habit to get into that will serve throughout their life."

Even though today's young adults grew up online, making the mechanics of online banking largely instinctual, Seaman says they still need guidance on how and why to save.

"You want to accompany each milestone with some guidance from the parents on managing expenses, maybe how to set up a budget, how to anticipate what they'll need the money for, and help guide them toward good, responsible management of their funds," she says.

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