Spring-Clean Your Finances in 5 Easy Steps
Have bills been piling up on your desk? Is your wallet bulging at the seams? Follow these easy steps to give your wallet a lightweight, spring-clean feeling.
Spring is around the corner and that means it is time for spring-cleaning! As an alternative this year, take a break from cleaning your house and start tiding up your wallet to have a more-fresher, cleaner mind-set on your debt.
1. Declutter Your Finances
The first step to spring-cleaning your finances is gathering all of your important financial documents that have been lying around the house. This means all of those leftover receipts, bank statements, and bills. Neatly organizing these papers will make it easier for you to track your expenses, maintain your budget, and stay current on your payments.
2. Bring in the Trash Can and Shredder
Now that you have everything you need organized, it is time to start getting rid of the unnecessary items.Toss old utility bills, trivial receipts, reconciled bank statements, and old correspondences with financial institutions, unless it’s an absolute necessity. Anything documents that contain sensitive information, such as your social security or bank account number, should be shredded.
You may also want to take the time to see what financial accounts you have offer digital statements and documentation. Optioning to receive your paperwork from these institutions electrically can help you cut down on the clutter and make next year’s spring cleaning go even faster!
3. Shine and Polish Your Debt
Take a look at your outstanding debts to gather a better understanding of your current situation. Are you current with your payments? Are you contributing more than the minimum? Are there any debts you’ve been neglecting?
If you find that you’re falling behind on your debt, you may want to consider giving your budget a little retooling. Adjusting your budget is an easy way to free up cash flow and can help you get back on track to paying off your debt. Look back at your expenses from the past few months and see if you were overspending on unnecessary items like expensive coffee or dinners. Cutting back on these sorts of expenses can help you free up some much needed funds to get your debt payments back on track.
4. Double Check for Dust in the Corners
Sometimes, when spring-cleaning your home, you may miss a spot or two on the floor – this can be the same when spring-cleaning your finances. Once you have created a budget plan, double check that you aren’t missing anything and try to make sure your numbers are accurate. Is your gym bill really $20 a month or are you just guesstimating? If you find it too strenuous to follow a super-itemized budget, you can get yourself started on the right track by simply tracking your expenses.
5. Mop, Treat, and Repeat
Now that you have spring-cleaned your wallet, it is time to make sure your finances stay clean and protected. You may use Pine-Sol to mop and treat your floors, but when protecting your finances you should consider setting up an Emergency Fund or simply opening a savings account. You should always make sure you are prepared for unexpected expenses. An Emergency Fund should have 6-9 months of expenses in it. If you have an emergency fund already, then maybe it’s time to start a retirement savings. Even contributing 5% each month to this savings will add up in the long-run. It is never too early to start saving!
Congratulations! After following these easy 5 steps, you have now concluded your spring-cleaning. Now that you have spring-cleaned up your wallet, you can sit back relax and have a clean mind-set on your debt! Have you spring-cleaned your wallet? Let us know how it went. How long did it take? Was it easy? Do you do it every year? Feel free to share your comments below!