Organizing Your Finances For The Future
We are always looking for ways to make sure that we will always be financially stable. We do this for our family and we do this to save money for the future. The hardest thing to do is to get organized, which requires much patience. It will take about 35 days and 5 weeks.
Week 1: Get Psyched - When you organize your financial paperwork, you’re less likely to miss a bill payment and more likely to know exactly where your money is going, which could help you save.
Week 2: Pay Attention - Jot down in a notebook what you spend for a month. As Bob Goldman, a financial planner in Sausalito, Calif., puts it, the idea is to cut through the “grand amnesia of what happens to your money” after your paycheck lands in your bank account. Can’t bear to record every latte and magazine for four weeks? Do it for one week and multiply each category by four; add in your monthly bills. Then take stock to see where you can cut back.
Week 3: Shred - You don’t need most of the financial paperwork that’s cluttering your life. You can throw out utility bills and credit-card statements within a few months. Hold on to pay stubs only until your W-2 arrives, monthly financial statements until you have year-end ones. Prevent new clutter from forming by opting for online statements from banks or brokerage firms.
Week 4: File - Create a tidy home for the stuff you need to keep: tax returns (and backup documents for at least six years), insurance policies, deeds, annual brokerage, 401(k) and fund statements and receipts for major purchases. Develop a filing system - a simple alphabetical one or groupings like auto and home.
Week 5: Automate - Move your bill paying online. Even better: Set up automatic payments for regular bills that are due every month or quarter, like your mortgage, cable and insurance.
Keep up with this and try more things on your own and you will be sure to get some results.