As a bank teller for over 5 years, I had access to thousands of customers’ bank accounts on a daily basis. Though I was bound by strict confidentiality rules, seeing the intimate financial details of so many lives taught me volumes about how people manage (or mismanage) their money. I learned three big lessons that could help millions better their financial health if they took them to heart.
Lesson #1: Automate Your Savings
One of the first things that jumped out at me was how few people actively saved money. Beyond their 401k contributions which were automated payroll deductions, hardly any customers regularly transferred money from checking to savings. And it showed in their dismally low balances – most had less than $1,000 in savings despite decent incomes.
I realized that the key difference between savers and non-savers came down to automation. Savers chose to automate transfers from checking to savings every month, whereas non-savers only moved money when they felt like it. And most people simply don’t feel like saving consistently, which is why their balances languish.
The lesson is clear: the simplest way to save is by automating it. Set up an automatic monthly or bi-weekly transfer from checking to savings and you never have to think about it again. Your savings will grow on autopilot. Even small automatic transfers add up over time into substantial nest eggs.
Lesson #2: Pay Down High Interest Debt Aggressively
The second thing that stood out was how much money people wasted on high interest credit card and consumer debt. I occasionally saw balances exceeding $10,000 at interest rates of 19% or higher. This debt sucked hundreds of dollars each month out of budgets in nonproductive interest payments.
What struck me about those in deep credit card debt was that they rarely paid more than the minimum due. Some even paid late and incurred penalties. By only paying the minimum, they were essentially choosing to stay in debt for decades, paying many times the original balance in interest.
The lesson here is if you have high interest credit card or consumer debt, you have to aggressively pay it down early. Pay far more than the minimum due to pay it off quicker. If that’s hard to do within your budget, you may need to make sacrifices elsewhere until the debt is gone. Don’t keep debt around that hangs like an albatross around your neck, draining your finances for years.
Lesson #3: Build Substantial Emergency Savings
The third big takeaway for me was the lack of emergency savings for most customers. It became painfully clear whenever an unexpected expense came up. Their checking account balances would go negative as they scrambled to pay an urgent car repair or medical bill. Then they’d incur overdraft fees that made the situation even worse.
Seeing account balances see-saw from positive to negative every month due to lacking savings made it clear – everyone needs an emergency fund cushion in checking for life’s curveballs. 3-6 months’ expenses is ideal, but even $500-1000 can prevent most overdrafts. Emergency funds provide tremendous peace of mind and financial stability.
Starting an emergency savings should be priority number one. Contribute whatever you can monthly, even if it’s only $25 or $50, to start building it up. Once you have enough emergency savings, you won’t live check to check on the financial edge. You’ll be prepared for surprise expenses.
The Road to Financial Success
While managing thousands of bank accounts gave me insight into poor money habits, it also showed it’s possible for almost anyone to improve their financial trajectory.
Saving, avoiding high interest debt, and building emergency savings are simple, proven ways to thrive financially. Automation tools can help make implementing these habits easy. Anybody can do it with commitment and consistency over time.
Sure, high incomes help accelerate the process. But moderate incomes combined with smart money management lead to financial success too. Integrating these three lessons as lifelong habits is the key to unlocking a healthy bank account, and a healthy financial future.