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De-Cluttering Your Finances

One checking account. One savings account. One brokerage firm. One insurance carrier. One credit card. One bill paying system. The qualities of “order” and “simplicity” bring a tranquilizing affect to my nervous system. My menopausal brain embraces simplicity too. Less things can fall off it’s radar screen. Truly though, I experience joy and peace when things are in order, whether it’s in my kitchen, walk-in closet or viewing my financial statements.  I can take a deeper breath when everything is in it’s place!

If you desire to have more peace of mind, control and increased energy in your financial life try these few de-cluttering strategies! If you have strategies to add, drop me a note on the community page.

Automate

Create systems that make your life easier and conserve your energy. You can begin by having your paychecks, pension checks or social security directly deposited into your checking account. Some banks waive the monthly fees if you sign up for direct deposit. Direct deposit is much safer than the U.S. Postal Service.

Pay your bills electronically from one checking account. You can easily keep track of all your transactions in one place, rather than paying some bills from one account and some bills from another account. Make sure you decide when to release the funds from your checking account rather than giving another party permission to take funds out. Automation saves you money in stamps and keeps your home office free of paper clutter.

Transfer a set amount of money from your checking to your savings automatically every month. This is the easiest way to save money for yearly bills, such as property tax, insurances, vacations and car repairs.

Consolidate

The average American has about 14 credit cards. This includes gas cards, store cards as well as major credit cards. You only need one credit card plus your ATM/Visa card. Close out the rest as a measure in preventing identity fraud. If you are maxed out on several cards, then consolidate your debt into as few cards as possible with the lowest interest rate possible. It is important to remember that your credit score can take a dip for about three to six months when you begin closing accounts, then it will come back up again. The reason for this is you are altering your debt to credit ratio.

Use one brokerage firm for all of your investments. You’ll receive three rewards. First, you won’t have to open, read, and file as many statements. Second, keeping an eye on your portfolio’s performance will be easier. Finally, you’ll save some money because, generally, the more you keep at a single company, the less you’ll pay in custodial fees and other expenses.

Consider obtaining home and auto insurance with one company. This way you only have to deal with one agent and you will most likely get a multi-policy discount that can be as high 20 percent on either your auto or homeowners policy or both.

Organize

Whether it’s your shoes or your money, you can’t see how much you have if it’s not organized! The first step in getting organized is to create a space in your home just for your money. This can be as simple as a banker’s box with a filing system inside, a plastic carry case portfolio from an office store or an elaborate filing system where everything is color coded and labeled. Create space for your monthly bills, insurance papers, wills, passports, financial plan, etc. I also create space for a calculator and mechanical pencils. It doesn’t hurt to have some dark chocolate hidden away too in case you need a break with all this organizing!

Remember, when your papers are organized, it’s a more pleasant experience to interact with them. The overwhelm is less.

Shred

A shredder is one of my favorite power tools. There is a certain pleasure I receive with purging old files, it’s a cleansing feeling.  Check with your accountant or attorney to receive guidance on when to shred certain paperwork such as old bank statements, bills, receipts and cancelled checks.
Also, to avoid becoming a victim of identity theft, shred any document that contains a Social Security number, bank account number or other personal or financial information. A crosscut shredder that turns paper into confetti is highly recommended by experts.

I hope these tips help you create a more pleasant experience with your finances. Who knows, you might have fun in the process!