Spring is the season of new beginnings. There is no better time to breathe new life into your financial situation and money habits than now. YFN took a look at experts’ advice from around the world and brings you these top 10 tips for spring cleaning your finances.
- Reconnect with your financial goals
Your money goals determine how you organise your finances. Therefore, start your spring clean by checking in with yourself to see if the goals you set before are still valid. If your priorities have changed, adapt your goals accordingly.
- Start with the big picture
Look at your overall budget, and if you manage to stick to it every month. If not, what needs to change? Also review your investments and insurance. Do you know what your insurance covers, and have you informed the insurance company of any changes, such a new address or job change? Check that your beneficiaries are listed correctly and that everything is clear in the event of an emergency. Do similar checks for your savings plans, and ask questions if you find anything you feel unsure about.
- Check your accounts in detail
This might not be the most fun, but making sure that all the charges on your bank account and credit card are valid and correct, can save you a lot of money.
- Challenge your expenses
Take your account statements and/or your monthly expense tracking lists, and go through them with three different colour highlighters. Use one colour to highlight your necessary costs (rent, water and electricity, insurance, school fees, groceries), and another to mark the items you bought because you really wanted or needed them (a vacuum cleaner or new shirts for work). The third colour is for stuff you bought without really thinking first (a round of drinks at happy hour or another pair of jeans). It might surprise you to realise how much you spend on stuff you don’t really need or want. Use this information to adapt your budget.
- Get help if you need it
Once you have reviewed your financial situation, you might have some questions about how to do things differently or better. There’s a lot of help available. You can talk to a financial advisor or a consultant at your bank. Also look online for budgeting tools and apps that help you keep track of your money.
- Put your finances on auto-pilot
If payments happen automatically, you never have to worry about missing them. It is therefore a great strategy to sign debit orders for loan repayments, and things like rent and insurance premiums. Do the same for your savings account and the money you invest for retirement. You can always cancel an automatic payment if your circumstances change, but automating them now gives you the best chance of reaching your goals.Plan your holidays
- Plan your holidays
If you have not yet started, now is the time to get organised for the December holidays. Look at travel and transport options and book tickets early to get the best prices. Keep an eye out for special offers on the things you want to get people as gifts, and put extra money aside for your festive season shopping.
- Do the filing
Are you not quite sure where all your tax returns are hiding? Can you get to your bank or credit card statements quickly and easily to clear up a dispute? If not, then it’s time to get organised. It could be as simple as opening a file or two, or creating folders on your computer for different aspects of your finances. It doesn’t have to be fancy, it just has to work for you; and it will save you a lot of hassle in the long run.
- Put your money A-W-A-Y
A proper spring clean often leads to more cash in hand as you eliminate unnecessary expenses. Don’t just leave the extras in your account, because you will end up spending it. Use it instead to settle debts or put it into a savings or investment account. You’ll thank yourself later.
- Create an ICE Folder
If you’re the money manager of your household, put together a folder of information that will help others figure out how to handle the finances in case anything happens to you. This is your “In Case of Emergency,” or ICE, folder. Include all the information someone would need to take over, such as your account numbers, login IDs and passwords, a list of bills you pay each month, investment and retirement fund info and anything else that would need to be handled in your absence. This can be a paper file, or a folder on your computer. Be sure to tell your family members where to find the folder. If your partner or someone else handles your finances, ask that person to create an ICE folder for you.