It’s officially spring, and for many that means dusting off cobwebs, cleaning out garages, and de-cluttering closets. Another springtime activity you should consider is spring cleaning for your finances. Take advantage of your new found energy and motivation, and get your finances in order!
Organizing your finances is the key to staying on track with your financial goals. Start by developing a system for expenses and bills. You can track this information with paper and pen, by using a simple Excel spreadsheet, or by taking advantage of a free online budget service or personal finance app such as Mint or BudgetTracker. As you develop your budget look at your spending habits. See if there are any areas where you can reduce or eliminate expenses. For example, you could cut back on the number of times you order take out in a month or cancel a service you don’t often use such as a gym membership. While you’re at it, you should take the time to organize your banking. Sign up for electronic statements and automatic bill pay. Toss or shred old statements to help make room in your files.
Review and Set Goals
Spring is a great time of the year to check in with your financial goals. If you made any money-related resolutions or goals at the beginning of the year, now is the time to check your progress and revise your goals if needed. If you haven’t made any financial goals this year, now is the perfect time to start.
Income Goals – Set an income earning goal for yourself. It could be to obtain a higher paying job, or even just to earn extra side hustle money.
Savings Goals – Individuals who actually set a savings goal are much more likely to save much quicker than those who don’t. Whether your goal is long-term such as saving for a house down payment or short term such as saving for a vacation, decide on a goal and figure out how much you can put away each week or month. Since we are talking savings, I might as well bring up retirement savings. Springtime can be a good reminder to change contributions to your retirement account, consolidate accounts if needed, and check that beneficiaries are up to date.
Debt Goals – In addition to setting savings goals, you should also consider setting goals to repay your debt. To get started make a list of all your outstanding debt totals and interest rates. Next, decide on a pay off strategy. There are many different debt payoff strategies. You could work on paying down your debt total with the highest interest rate first, or start by tackling your smallest debts first, thus creating a debt snowball. Decide on a payoff strategy that works best for you and your situation.
Check Your Credit Report
While you’re taking the time to get your finances in order, you should check your credit reports, and review each one carefully for inaccuracies or errors.
De-clutter for Cash
If you are in the mood for de-cluttering and getting rid of items you no longer need or want, consider selling your unused items to make some extra cash. In addition to selling your items online using forums such as Craigslist and eBay, you could have a garage sale.
Find Additional Savings
It’s always a good idea to shop your insurance rates every few years. Getting up to date insurance quotes for your home, auto, even life insurance policies can save you big money.
You can also look to save outside of your personal life with business savings. If you’re a restaurant owner, you can shop at RDW for great savings on all of your day to day stuff. If you’re a small business owner, consider shopping at outlet stores like TJ Maxx or Marshall’s instead of the top of the line furniture stores.
Do you spring clean? Do you include your finances?