Organizing Your Finances: Four Simple Steps

My life is an explosion of paper.



Receipts.  Notices.  Bills.  Permission slips.  Prescriptions.  Notes for the website.  Scratched ideas on napkins for our radio show.  Drawings from the kids.  Junk mail that might be handy.  It all adds up.  It takes no time at all to discover I no longer know what’s important and what isn’t.

In desperation, I found an excellent article on from Jean Chaztky.  Follow along and see if these ideas can help you, too.

Four Simple Steps To Organizing Your Financial Life:

  1. Get The Right Tools: Having the right supplies will make the process easier. Hanging folders, files  and labels are necessities. You’ll also want stamps, envelopes, Post-it notes, a  stapler and pens. Put them all in a box.
    Label your hanging folders  according to your needs, but I like to use these categories: home and auto;  healthcare and insurance; saving and investing; income and taxes; and credit  cards and other debts. Then you can use file folders to sort subcategories.  Let’s say you have two credit cards; you’ll want a folder for each. Start fresh  every year.
    Read more here.
  2. Dig In: When I clean a closet, I pull everything off the racks and toss it onto my bed  or the floor. You want to do the same with your bills and paperwork.
    If  it’s sitting in a pile on your kitchen table, move it to an area that can be  messy for a little while. This can take anywhere from several hours to several  days depending on how much stuff you have to plow through and how much time you  have to devote to the process.
    Read more here.
  3. Start Sorting: Once you have everything in front of you, make three new piles: Pay, File and  Shred.
    Take statements and bills out of their envelopes. If you find a  bill that needs to be paid, do it on the spot, says Monica Ricci, an organizing  expert and author of Organize Your Office in No Time. “Paying bills as  they come in gets them off your plate physically and mentally,” Monica  says.
    Bank, insurance and brokerage statements should be filed in their  folders. Consider getting a shredder to get rid of obsolete files with personal  info and other papers you don’t need. Then recycle.  Look how virtuous you feel!
    Follow  the 5 Ds to give your paperwork an organizational overhaul Watch
  4. Stay On Track: Here’s the tricky one for me.  Once you have a system in place, it’s all about maintenance. Pay bills online  and get statements via e-mail to cut down on clutter. When the mail comes, sort  it in just a few moments. Every time you open a new account or switch insurance  coverage, start a new folder for it.
    Twice a year, give your system a  once-over to ensure you’re on track.
    Find  out how long you need to keep your financial paperwork
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