Spring has sprung! And while many people begin to tackle spring cleaning in their homes, there might be other areas in your life that deserve some TLC too. Yes, we're talking about finances.
We've compiled a list of tips that can help you declutter and re-organize your financial life. Just like a good dusting or closet clean-out can make you feel like a new and improved human, these financial tips can do just the same!
Tip #1 - Refresh your budget. It's important to take a look at your budget every few months to evaluate whether or not you are meeting your spending and saving goals. How much are you spending versus how much are you bringing in? What are you saving goals for 2021? What areas are you spending the most money and how can you change your spending habits to meet your new goals? Especially coming out of the long winter months and into the summer, you might have more activities you need to set aside money for. Budgeting, especially when lifestyle changes happen, is an important task to control your finances.
Tip #2 - Shred old documents. Most documents such as bills, bank statements and pay stubs can be found online now, which means the ones you have piling up on your desk can be shredded. On the other hand, some documents should be kept for a period of time such as tax returns, IRA contribution records, retirement statements, etc. If you're unsure what to keep, check out Bankrate's article on how long to keep specific financial records. The goal is to keep as little paper clutter as possible so you can better organize your documents and stay on top of your finances.
Tip #3 - Look at your insurance policies. How long has it been since you looked at your insurance policies? As life changes, your insurance policies might need to be updated as well. A great way to determine your options is to call your insurance provider and discuss how you can secure better deals on your auto, home and health insurances.
Tip #4 - Pay down your debt. It's time to get serious about paying down debt. Going back to the budget tip, you should first get familiar with how much you have left over after covering the necessities. With this amount, plan to keep your additional spending down and allocate more of the funds toward any debt you owe. In the long run, you will be happy you were more aggressive with paying down the debt because you will have paid less in interest, saving you more money.
Tip #5 - Check your credit report. Did you know that you can check your credit report for free once a year from each of the three major bureaus? This is important because you never know when a mistake may occur, and it could be lowering your score. Use this time to take a look through your report for potential errors, then sign up for a free credit monitoring service to track and alert you of changes.