Don’t Become a Financial Couch Potato:
You know that feeling when you bike or drive down a steep hill? The sensation of your stomach doing a flip-flop? For those who hate to organize their finances as much as cats hate water, getting started may come with that stomach flip-flop feeling. Like you’re driving down a hill way too fast, with little control.
Maybe organizing your finances feels like such a risk because you don’t know where to start. Even if your money mess seems unmanageable, finding an organization strategy that works for you is vital to becoming debt free, saving, and making wise money moves. Here are a few ideas to organize your money like a pro, rather than ignoring it and hoping it will somehow work out.
Oh So TraditionalIf you prefer to organize your money the traditional way, you can get a basic grip on your money with a pen, paper, calculator, and some time. Treat this time as an appointment you can’t miss.
Next, gather all financial statements, monthly expenses, and any other information important to your monthly finances. Make a list of all expenses, including any money spent on extras. Then, add up all of your income sources. If your expenses go above your income, you need to either cut expenses or add income. This is the most basic aspect of personal finance. It is also why organization is so crucial. If your expenses constantly exceed income, you set yourself up for overwhelming debt, excess stress, and financial failure. Know what’s going on with your money.
If after looking through financial statements you notice problem areas, such as recurring late payments, create a schedule for making payments so that they are on time. Addressing these areas enables you to work toward a sustainable lifestyle – one that fits within your time and income.
Too Busy for Traditional?Feel like your work-life balance is way out of control? If your pace of life doesn’t allow much time for paper and calculators, consider using one of the latest financial technologies to do the grunt work for you. Many, like QuickBooks, are free for download.
You can also use financial software to schedule payment reminders or even to automate your payments for you. This safeguards against late fees and financial disaster. You can even program in your bank account information, and QuickBooks will pull all of your major expenses and add them up for you. With all of your expenses laid out in an easy to view format, you can easily compare them against your income. You can also compare which expenses you need to cut, reduce, or keep.
Automating financial transactions and information helps you reduce the clutter of paper statements, while allowing you to centralize your finances. Having your money statements and budget information located in one easy, convenient location makes dealing with monthly finances a lot less daunting.
Do a Financial HousecleaningIn addition to locating statements and budget information in one location, it stands to reason that the less financial accounts you hold, the easier it will be to organize and stay on top of them. Do you have multiple accounts at various locations that could be moved to one or two locations instead? Doing so may help streamline your finances. The less you have to keep track of, the easier it will be to focus on debt reduction strategies.
Maintaining organized finances in a way that fits your situation helps eliminate wasteful spending so that you can get rid of debt and save more. This way, financial hardships won’t send you directly into financial disaster.
A Picture of Sustainable LivingNow, take a moment to think about what life would be like if you weren’t constantly worried, stressed, or confused about your finances. If you didn’t always struggle to make ends meet, or feel like you have no control over your own finances.
Now, imagine that keeping your finances well organized and managed is part of a plan that enables you to stop wasting energy on financial worry. In reality, putting in the effort to keep your finances well organized and managed has significant implications for the overall quality of your life. And, without the burden of financial stress, you are free to make your money work for you by pursuing new ideas, dreams, or career paths. It sets you up to do what matters to you.
A sustainable life is one that that doesn’t spend more than it brings in, and plans to the best of its ability for the future. It’s one that values money enough to use it wisely – it views money as an important life tool. Sustainable living is difficult when your money is a mess, and you’re not sure where to direct it.
So, take some time to figure out a money-management plan that works for you. Whether it be writing out your finances and using a paper-filing system, or using computer software that does the work for you, it’s important to start somewhere. If you find that one system isn’t working, try a new idea and keep adapting until you find something that does work.
Just try it; you’ll be amazed at the results. A little organization and action now goes a long way toward bettering your financial results.