Archives

ModestMoney.com Top Finance Blogs

Binaryoptionrobotinfo.com is the best resource for binary trading.

Binary Options trading made easy at 7binaryoptions.com.

Spring Cleaning Your Finances

spring cleaning your financesSpring is here, and with it comes spring cleaning.  Every year, I’m determined to get my house in order.  Every year, I fail, mostly because I’m tackling much too large of a task.  But I can break the task down into smaller projects.  This year, one of those projects is to spring clean my finances.  Play along with me and spring clean your finances as well!

Task One – Shred Those Old Documents!

Every so often, various financial paperwork arrives in the mail.  And I dutifully file it away.  (Well, I usually let it pile up, then do a big batch of filing all at once.)  But how much of it do I actually need to keep?

Let’s start with Tax Returns.  You only need to keep 7 years worth of your tax returns.  So all those old folders with your returns and deductions? Put them in the shredder!

How about credit card statements?  Once you’ve passed a year, you don’t need them (unless you need them for tax purposes).  If your statements are available online, you likely don’t need those paper copies at all.  You can either rely on the ability to download them at any time, or you can download them and save them on your computer (though I would recommend making sure your computer is secure and those files aren’t easily accessed – this goes for all your electronic financial documents).  I would recommend still deleting the older files and only keeping those absolutely necessary.

Receipts?  Only keep those for big purchases.  The rest can be shredded once you’ve recorded them in your budget.  No need to keep grocery receipts around forever, after all.

Paycheck stubs?  Keep them for a year, until you get your tax statement from your job at the beginning of the year.  Then shred them.

Task Two – Organize Your Files

Yes, I know, the most dreaded “Spring Cleaning Your Finances” task.  What is your method of storing financial paperwork?  Could it be better?  Now, I’m not saying you need a beautiful filing cabinet with meticulously labeled, color-coded files.  But you do want your paperwork to be somewhat organized.

As I mentioned, I don’t file on a daily basis, or even weekly.  I have a file tray that I pile paperwork in, and then every six weeks or so, I go through the tray and decide what to keep and what to shred, and then how those things should be organized.  I try to keep my categories as simple as possible.  In my file box, I have the following folders:

  • House
  • Car
  • Work (both my main job and my freelance gigs)
  • Pets
  • Current Year Taxes
  • Purchases
  • Bills
  • Medical
  • Other

As I’m prepping for tax season, I go through some of those folders in more detail and decide what needs to be kept and what can get shredded.  It’s not the most sophisticated system, but it works for me.

Task Three – Review Your Budget

The next step in the “Spring Cleaning Your Finances” Plan is to take a look at your budget.  What sort of recurring expenses do you have?  Are they all necessary?  With the prevalence of streaming media, monthly subscription boxes, other paid online accounts, it’s really easy to find yourself spending $100 or more without realizing it.  A $10 subscription box doesn’t sound that bad, and if you enjoy it, it’s certainly worth it, but if you’re suddenly getting two or three of those boxes, that cost is increasing exponentially.  And what about streaming media?  Netflix, Hulu, premium channel accounts, they all add up.  I admit, I subscribe to a few different streaming services, but I’ve made a point to cut down.  I don’t have cable, so these online streams are my main sources of entertainment.

That said, I’ve discovered these accounts are all really easy to cancel and re-subscribe to at any time.  Are you finding yourself not watching very many Netflix shows?  Cancel your account!  Then, when Netflix releases the next season of Stranger Things (or whatever show you happen to be waiting for), you can easily sign back up.  Trust me, they will happily take your money.  Maybe you only unsubscribe for two or three months, but that’s money in your pocket.

Spring cleaning can put money in your pocket in other ways as well.  You may find items you can sell or donate to charity (which leads to a tax deduction if you itemize).  You may discover items you forgot you owned and thus no longer need to buy.  Maybe you’ll simply find peace of mind and a fresh start now that your home is clean and tidy.  Either way, a great first start is spring cleaning your finances.

 

 

Love Counting My Pennies?

Screen_shot_2017-04-24_at_3.46.43_pm

Sign up to get our latest content by email.

Powered by ConvertKit

Leave a Reply

 

 

 

You can use these HTML tags

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>