Spring is a wonderful time of year, isn't it? Flowers are blooming, the sun is shining, and everything glows with a warm cheerfulness. I know, personally, it’s hard to imagine the warmth of spring on my skin right now when we experienced freezing temperatures this past week in San Antonio (are you kidding me, Jack Frost?!), but it is upon us!
The budding flowers, warm breezes, and the crack of a baseball bat during spring training are certainly things that I look forward to. On the other hand, the season also brings a less exciting ritual we are all familiar with: spring cleaning. After we grudgingly break out the cleaning supplies and spruce up our living spaces, we embrace a fresh new start when the cleanup is all done. But spring cleaning isn't just for your home. Just like clearing out junk from your closet, a financial spring cleaning can help you get things in order. Here are five ways to simplify and reorganize your finances.
1. Organize Documents
A good place to start organizing is your documents. If you don’t already have a filing system in place, establish one for all of your important paperwork: taxes, mortgage, bank statements, etc. The IRS recommends keeping tax documents and supporting paperwork for three years, but of course, you can keep them longer. Take a look at the documents you currently have, and be sure to effectively shred anything you no longer need. If you want to be environmentally friendly or eliminate clutter, you can save documents you receive electronically on your computer or laptop.
2. Revisit Rates
It’s a good habit to shop around for better rates at least once a year. Whether it’s your auto insurance, cell phone or cable bill, subscription services, gym memberships, or other expenses that impact your day-to-day life, reviewing these policies and rates can sometimes save you more than you think. If there are services that you no longer use or they’re underutilized, you could reallocate those expenses to a savings account or toward other necessities.
3. Review Your Credit Report
The Fair Credit Reporting Act (FCRA) requires each of the three major credit reporting agencies to provide you with a copy of your credit report once every 12 months, at your request. Your credit history greatly impacts your financial future. Reviewing your credit report on a regular basis can help you spot identity theft early, find inaccuracies, and prepare you for major purchases such as a vehicle or home. You can request your annual free credit report at annualcreditreport.com.
4. Automate Your Bills
Automating your bill payments can be one of the easiest things you do to simplify your finances. You avoid missing payments and late fees, and it’s one less thing you have to worry about. If you haven't already, consider automating your savings, too. It's a great way to put money away before you see it, which can quickly help you build up a nice nest egg!
5. Examine Your Budget
When was the last time you took a really good look at your budget? Have you had an increase or decrease in your income? The beginning of the year is a great time to review any changes in your income and expenses to help determine if you need to make adjustments to your spending habits. Apps such as Mint, SWBC’s Vault platform, and most online banking services are also great tools to help you identify trends in spending habits. Identifying and cleaning out the unnecessary expenses will help you stay on track going forward.
Do you have any budgeting and financial wellness hacks that could benefit your fellow readers? Share them in the comments below!
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