At the start of a new year, everyone is quick to set goals for their life and finances. But as the year progresses, it’s easy to fall off track and get unorganized. This year is flying by so it’s getting reorganized and following up on your progress is crucial.
Planning your finances out at the beginning of the year is just a start. It’s important to check in with yourself and stay organized because your situation is subject to change as the year goes on.
Reorganizing your finances throughout the year is also a great way to prepare for tax season so you don’t become overwhelmed when it’s time to organize your documents and deal with everything.
Rework Your Budget
Budget categories can change constantly and you gain and lose certain expenses so it’s a good idea to keep updating everything regularly. If you haven’t looked at your budget in a while, check to make sure that all your categories are still accurate and realistic.
If you’re using Mint, a wonderful financial budgeting tool and app, update your accounts and review your spending reports from previous months. Make sure that all your accounts are showing the most up-to-date information and balances.
Gather All Your Financial Documents
If you still receive paper statements for any of your accounts or bills, make sure you gather up all your mail and organize your bills into categories and file them away in folders.
I choose to go paperless for most of my accounts but somehow I still get a few notices in the mail from time-to-time so if you have a similar situation, try to sort all of your mail as it comes in so you don’t leave some important documents around your house to get lost.
In order to keep track of everything, create separate folders for bills, medical documents, credit card statements, debt payments, insurance etc. While you’re reorganizing your documents, feel free to shred and toss any unimportant papers that you no longer need. You should definitely keep old tax forms and payment receipts, but things like letters from your former auto insurance company, credit card offers you didn’t follow up on and any utility bills from years ago that you have digital records of online might be okay to toss out.
Check Up on your Auto-Pay Accounts
Setting up auto-pay for bills and monthly payments is a great way to reduce the pressure of having to take the time out to manually submit payments. It also helps ensure bills are paid on time. However, you need to check in with your accounts every now and then to make sure no errors were made.
If you’re auto-paying your student loan balance each month, log on to your account to verify that the payments have been applied correctly. Major companies and banks make mistakes too, but by being alert you can handle small mishaps before they turn into sticky situations.
Utilize Multiple Savings Accounts
If you have multiple savings’ goals it’s ideal that you have multiple accounts to separate everything. For example, your emergency fund should be separate from your short-term goals like buying new furniture or saving up for a better car. If you keep all these funds in one single account, it will be all too easy to mix up the money and end up misusing it.
I use Capital One 360 to house all my different savings accounts. Currently, they offer a competitive interest rate of .75% and you can open up to 25 different savings accounts and nickname them to help remain organized. Currently, I have savings accounts with CapitalOne 360 for my emergency fund, medical expenses, holidays, auto insurance, taxes and a conference I plan to attend this year.
You can certainly open extra savings accounts with your current bank, but online savings accounts like Capital One 360, Barclays and G.E. Capital Bank are the best options because they offer higher interest rates and don’t require a minimum balance.
Have a Financial Date With Your Partner
How often do you go on financial dates with your partner? I know it doesn’t sound romantic, but it’s an important thing to have to help shape your financial future. Check in with your partner at least once a month to go over your goals, challenges and discuss any changes so you both can be on the same page.
A financial date is the best time to bring up announcements and make plans for the future so your partner doesn’t feel like anything is just sprung on them at the last minute. Making plans for your money together will allow you to be in sync with each other and both working toward the same goal even when the other person is not around. Talking about what has been working and what hasn’t been working and laying out a plan will help you both maintain control of your finances.
Preparation and organization is key when it comes to successfully managing your finances.When your finances are organized, other aspects of your life will seem to fall into place. You won’t have to be stressed or worried about your budget or dreading tax time when it arrives.
Have you checked in on your financial progress lately? How do you organize your finances for peace-of-mind and to improve your focus throughout the year?