One of the six habits of the financially fit is to organize your finances. Unfortunately, many people are unwilling to organize their finances because there is simply too much to do. I am reminded of a proverb that says, “How do you eat an elephant? One bite at a time.” Reduce financial organization to individual tasks. Instead of saying, “I need to organize my finances”, say, “I need to balance my check book.” By having a list of smaller, specific tasks, you will ultimately be able to get your finances organized. To help in that endeavor, I have included a list of tips for organizing your finances.
28 Ideas for Organizing Your Finances
- Have an easy to access reference for all your financial documents. This may be a central location where all the documents are located or a list that describes the location of all those documents. This practice is helpful because it forces you to look at a big picture of all your financial products. When you list your account information for five banks you might realize that it is time for a little house keeping.
- Use a well organized filing system. Depending on your financial needs your filing system may contain physical hard copies or electronic copies. You should have one file for each credit card, each bank account, auto insurance, health claims, health insurance, life insurance, and so on.
- Keep a copy of all your important documents. This includes things such as passports, credit cards, and social security cards. Be sure to list important contact numbers in case the documents are stolen. Keep these safely on file.
- Put important documents in a safe. In the case of a fire or theft you should have important documents in a safe. We keep our title, passports, and government issued documents in the safe.
- Consider getting a safe deposit box at your bank. If you are uncomfortable with the idea of having important documents at your house, put them in a safe deposit box instead.
- Put a notebook beside your phone. This way you can write down information when you make important calls. Write when you called, who you talked to (employee ID number if available), and the suggested course of action. You never know when one phone call will turn into your next company saga.
- Close duplicate accounts. If you have more than one bank account or credit card consider downsizing unless the accounts play very specialized roles.
- Have one location in the home where you always put your bills. Regularly check the box and take a few moments to take care of the bills.
- Designate one day a week at a convenient time to send bill payments.
- Automate your payments. If you have a regular bill with a regular payment amount, consider setting it up as an automatic bill payment. Schedule your investments to automatically be invested on a certain date.
- Use a calendar to write important payment due dates or bank transaction dates. When you initiate an electronic payment be sure you write it on the calendar before doing anything else.
- Put a shredder next to the desk where you often deal with financial documents. If you don’t need to keep a piece of paper, go ahead and shred it right away.
- Make it a rule to avoid opening financial mail until you know you have a least a minute to deal with the item. Once it is opened and set aside you are more likely to forget it.
- When you read an email that requires action, always put a reminder or flag on the message to be sure it does not get buried under other emails.
- Use a system, like Evernote, to keep all your online payment confirmation numbers.
- Sign up to receive electronic bills and be sure you have a good e-filing system. When the bill arrives, save it into the right file before moving on to another job.
- Carry a notebook. Record your purchases every day.
- Once a week sit down to record all your purchases from the week. Don’t miss that day, because if you don’t do it this week, what makes you think you will have twice as much time next week?
- Set up a simple budget and use its direction on a month to month basis.
- If you are married, allocate appropriate responsibilities between each spouse. Know clearly who will do what and be sure you plan to do a job you enjoy (if at all possible).
- Keep a small notebook in your glove box. Record gas purchases. Date, total price, price per gallon, and current mileage.
- Keep every pay stub. Put a file in your filing cabinet and keep this information on hand.
- Get rid of one item for every new one you buy. For example, donate a shirt to Goodwill every time you get a new shirt.
- Save every receipt. Once a week take the receipts out of your wallet, write them on your budget, and put them in an envelope. Keep the envelope for a year and then start throwing out old receipts.
- When you buy an item with a lowest price guarantee write the date and information in your computer calendar. Set the calendar to remind you one week before the offer date ends. Call around or visit around that week to see if the prices have dropped.
- Take a list when you grocery shop. Stick to the list.
- Take an evening and track down all your one time expenses – life insurance, health insurance, auto insurance and anything else you pay once. Divide that number by 12 and be sure you are saving that amount each month.
- If self employed, calculate your estimated taxes. Total annual tax bill / 4 gives you your quarterly payment. Take the total annual tax bill and divide it by 12 to be sure you are saving that amount each month.
The key goal of organizing your finances is to know how much you make, where your money is going, and how to control the flow of your cash. Once you learn some of these skills financial management becomes much easier.
Photo by evelynishere.
What ideas do you have for organizing your finances?