Spring tends to inspire a wave of household cleaning and decluttering. Why not extend this refresh to your financial life as well? Let’s cover 10 ways you can streamline your finances:
1. REFRESH YOUR BUDGET
Staying in tune with your financial goals significantly depends on your budget management. This season, scrutinize your spending, earnings, and savings during the last quarter to identify what works well and what doesn’t. Based on your learning, make necessary adjustments and maintain an accurate representation of your financial status. There are several budgeting apps that can assist with this task.
2. PLAN YOUR BUDGET AHEAD OF TIME
Proactive planning is a sure-shot way to streamline your expenses. Start planning your budget for the next month at least a week ahead. By doing so, you’ll be able to factor in unpredictable expenses, optimize your expenditure, and set a realistic budget.
3. ESTABLISH AUTOMATIC PAYMENTS
Automatic payments are a smart and effortless way to keep up with your financial obligations. Sign up for online banking to automate the payment of your bills before their due dates. Of course, ensure you have enough funds in the account.
4. EVALUATE YOUR SUBSCRIPTIONS
If you find yourself tangled in numerous subscriptions, it might be time to disentangle. Consider their cost against their worth to you and cancel any subscriptions that don’t justify the cost.
5. ORGANIZE BILLS AND RECEIPTS
Maintain an organized file of your bills and receipts for easy reference during disputes or tax procedures. You can choose physical or digital filing – whichever suits you better.
6. MERGE RETIREMENT AND INVESTMENT ACCOUNTS
If you have multiple retirement and investment accounts, consider consolidating them. This could simplify your overview of your financial situation, lower transaction costs and fees, and ease tax preparations and retirement planning.
7. MONITOR YOUR CREDIT SCORE
Regular credit score checks can help you spot errors that might be affecting your interest rates. Contrary to popular belief, such checks, known as “soft” checks, don’t affect your overall credit score.
8. FUSE YOUR ACCOUNTS
Managing multiple checking accounts can be helpful. For instance, having a separate account for fixed expenses makes it easier to gauge the money left for flexible categories like groceries.
9. DISPOSE OF OUTDATED FINANCIAL DOCUMENTS
The IRS suggests keeping important documents for seven years after filing the return. Take the time to sift through old files, shred those not needed, and develop a management system that keeps your documents organized and accessible.
10. ERADICATE UNNECESSARY SPENDING
Small, impulsive purchases may seem trivial but can accumulate to substantial amounts over time. Track these expenses through bank statements and strive to reduce them by 10% each month or consider eliminating them altogether for a stipulated period.
Remember, a financial refresh is not strictly a spring exercise, but can be done year-round when you need a new start. Use these steps as your guide anytime you require a financial overhaul.
