We’ve talked about a lot of things on this blog. You can find every post right here. We started with goals and values, net worth, and expenses. These are important financial principles and foundations, BUT even these steps might feel stressful. That’s okay. If that’s how you’re feeling, I would start with this.
Start by getting financially organized – just a little at a time. Try to get a little more financially organized. And then a little more and a little more. You don’t have to do it all at once. Do it as things come up. Over time, I think you’ll be surprised how small steps amount to real progress and leave you feeling much better.
Get Financially Organized
Here are my three suggestions for how to start getting organized:
- KEEP EVERYTHING IN JUST TWO MAIN FOLDERS
- I suggest having only two places for all things financial – a paper folder and an electronic folder.
- The paper folder (or binder or whatever works for you) is where you should keep all paper statements and document, from bank accounts to insurance documentation.
- The electronic folder should be used to store all digital documents and emails. (You may decide a folder for documents and another within your inbox for emails works best for you.)
- You only need to add sub-folders and categories if that helps you.
- As a first step, just starting putting things in these folders as you receive them.
- Later, when you find or need to dig up an an old document just add it to the folder.
- SIMPLIFY AND AUTOMATE
- As a second step, I recommend simplifying and automating things as they come up.
- For example, if you notice you are paying a bill manually each month, the next time it comes up see if there is an automated option for payment. If so, implement it. (I introduced my landlord to Venmo, so paying rent is now much easier.)
- If you aren’t receiving your paycheck via direct deposit, see if this is an option.
- If you want to start saving more, trying automating a transfer of $25 a month (or whatever amount feels comfortable to you) into your savings account.
- If every month you get a statement in the mail that ends up in a pile, see if you can go paperless and start receiving your statements electronically.
- Again, just do a little at a time as things come up.
- SCHEDULE TIME
- Finally, when you’re ready, set aside 30 minutes a month to review your finances. If 30 sounds like too much, make it 10.
- I recommend you put this on your calendar to hold yourself accountable. If you share finances with a partner, it’s even better if you can do it with them, but if they’re not on the same page yet just do what you can yourself.
- Maybe you use this time to automate something, as mentioned above, or go through that pile of paper statements.
- Maybe you set up Personal Capital or Mint to help you track your finances more easily. Just add accounts as you think of them. It doesn’t have to be perfect from the beginning.
- You might decide to calculate how much you spent at restaurants or on clothes during the prior month.
- Again, just take a few minutes to start getting a little more acquainted with your finances than you are today. Set a timer and work until the timer goes off.
Small Steps Add Up
If you work on the steps outlined above, over time you will find yourself more organized and aware of your current financial picture. Small steps add up to significant improvements! So if you’re feeling overwhelmed, I recommend starting here.