10 Ways to Organize and Improve Your Finances
I don’t know about you, but after months of winter, I’m feeling inspired by the oncoming Spring. It’s the perfect time to reset and refresh so many areas of your life. From getting outside more to cleaning up your house to doing a financial spring cleaning, there’s so much potential in this season of renewal.
If you’re like most people, you probably don’t often take the time to organize and “clean up” your finances. I get it, it can be a boring and tedious task for many people, but it’s my job to make this as pain-free as possible.
That’s why I compiled a Financial Spring Cleaning list to help you brush up on your budget, declutter your bank account of unnecessary expenses, and sweep out all the financial cobwebs so you can have the polished up and sparkling finances you deserve!
Review Your Budget
Budgets are meant to be fluid and have the ability to change as your life changes. Reviewing your budget consistently helps you to optimize it for your current financial state. If you incur new expenses, such as buying a car, you have to work them into your budget. If you’ve eliminated an expense, such as paying off your mortgage, you have to figure out where the money for those payments will go now.
Reviewing your budget helps you catch any issues and notice patterns in your spending. Are you consistently overspending on food? Maybe you need to allocate more money to that category as grocery prices rise. Have you noticed you don’t spend as much on new clothes? Take that extra money and put it in your savings.
Taking the time to review your budget ensures your money is going where it needs to and you’re not overspending in certain areas. Remember to always track every expense and don’t leave a dollar unaccounted for. Budgeting helps keep you on track and in control of your money. If you’re unsure where to begin with budgeting, you can read The Beginner’s Guide to Budgeting here.
Reassess Your Financial Goals and Track Your Progress
What financial goals are you trying to reach? Do you want to pay off your car? Save up for a house? Invest in your retirement? Asking yourself these questions helps you gauge which goals to focus on and where to allocate your money in your budget.
Track your progress as you make strides to accomplishing these goals to help keep you motivated. Something that helps me is visually seeing the improvements. I track my total debt month to month and something about seeing that number go down gets me really excited to keep going and pay it all off!
It’s also possible that your goals have changed since you last set them. That’s totally ok! It’s important to sit down and restructure your goals so they make sense for you moving forward. It’s all about being intentional with where your money goes, and a financial spring cleaning is the perfect time to do this.
Cancel Forgotten Subscriptions
Think of this like cleaning out your closet. There’s probably a lot of stuff crammed in there and you probably don’t remember what half of it is. As you pull everything out, you hardly recognize the items you had stored in there. Why did you ever buy such an ugly hat in the first place?!
Whether it’s streaming services, a gym membership, food delivery app subscriptions (DashPass), monthly car wash memberships, or any of the plethora of subscriptions available these days, find what you don’t need or use, and cut them out. Trust me, you don’t really need them. So many subscriptions sell the illusion of ease just so they can suck money out of your account every month.
All of these tiny fees may not seem like a lot individually, but when all of these fees are added up, you could be losing hundreds of dollars a month. Cutting them out could save you thousands of dollars a year, and isn’t that worth driving to pick up your Taco Bell instead of paying a monthly fee to have it delivered to your house cold by a stranger?
These changes don’t have to be forever, but if there are goals you’re trying to reach, temporarily reducing these expenses will help get you to the finish line quicker.
Schedule Payments to Prevent Late Fees
If you’re the type who forgets to pay bills on time and you haven’t already set up scheduled payments, what are you doing? Maybe you like being hit with penalties and late fees, I don’t know. But if you don’t, this is a simple way to streamline the process so you don’t have to worry about what’s due when.
Many subscriptions are automatically taken out of your account, so be sure to check on those like I mentioned above, but other bills may not be automatic. Expenses like your credit card, car payments, rent/mortgage, and insurances may not be set up to come out of your account automatically.
I recently automated my student loan and credit card payments, and it’s nice having two less things to worry about. I also write down the due dates in my calendar so I can plan ahead and make sure I have enough money in my account before the payment is taken out to avoid over drafting.
Plan Out Future Expenses
It’s impossible to plan for every possible unforeseen expense that may pop up, but you can still be as prepared as possible without a crystal ball. Similar to how I mentioned I put all due dates of bills in my calendar, I also plan out certain expenses and fit them into my monthly budget ahead of time to make sure I can afford them.
Things like birthday gifts (or wedding, holiday, housewarming, etc.) can be planned out because these are all events that you have time to prepare for. Routine vehicle maintenance like oil changes or yearly inspections can be planned out ahead of time per the little stickers on your car. Vet appointments for your pets or annual check-ups for you and your family can also be easily planned out since they’re non-emergencies.
Putting these expenses into your budget ahead of time can help you avoid going over budget. If you know you have to get a wedding gift for your sister in May, you might hold off on making an extra payment on your car or buying the new bag you want until June. Developing the ability to delay gratification and prioritize expenses is really what’s key here.
Turn Your Clutter Into Cash
This is a real two for one special. You get less clutter and a little extra cash in your pocket. It’s ideal for both a regular and a financial spring cleaning! I hate clutter so much; it’s distracting and causes anxiety. Having a clean and tidy environment makes my life a lot easier. If you’re like me and you find you have too much stuff, try selling it on FaceBook Marketplace or OfferUp.
I’ve had a lot of luck with these sites, but sometimes your stuff will sit on there for a while. If your patience fails, you can always just donate your stuff instead, but why not try to see if your trash is another man’s treasure first.
Create a Meal Plan for the Month
So many people spend so much of their money on food, only for it to go to waste. With grocery prices getting higher and higher, many people can’t afford to throw out anything. It can also be hard to not give into ordering food or going out to dinner. I would know. I used to spend almost $1,000 per month on eating out.
But I found that planning and prepping meals in advance helped save money and prevent me from going out to eat as much. When you go into the grocery store with a set list to make specific meals for the week, you don’t buy as much unnecessary stuff and less of the stuff you do buy goes to waste because it has a purpose.
Remember that leftovers are a thing and they’re a good way to make your food stretch and avoid having to cook every night. Make a little extra when you cook dinner and take it to work with you the next day for lunch or save it for dinner the next night. This makes life a lot easier and gives you a reason not to order takeout.
Set Up Sinking Funds for Large Purchases
What exactly is a sinking fund? If you don’t know, a sinking fund is simply money you regularly set aside for different expenses that happen occasionally. Similar to planning out future expenses, sinking funds give you time to save up for the bigger ticket items that you may not be able to afford within a normal monthly budget.
Purchases such as cars, vacations, new home appliances, engagement rings (wink, wink) would all fall into a sinking fund. Let’s say your goal is to save up $5000 to take a vacation next year. This would mean you’d need to save $416/month for a year to afford it.
Simply keep your savings in a HYSA (high yield savings account), track your progress, and when you reach your goal, you can pull the money out and enjoy your vacation!
Review Your Credit Report and Credit Score
Reviewing your credit report is a good idea, especially if you’re looking to apply for credit, such as a mortgage, in the near future. It’s important to have a good idea of what lenders might see when they look at your credit.
You also may find potential mistakes that could be affecting your credit. Things like identity theft or fraud could be tanking your credit, so regularly monitoring your credit can help you spot these potential threats and act on them sooner.
Shop Around For Better Rates
How do you know you’re really getting the best deal? Shop around to get quotes and pricing from other companies to make sure you’re not paying more than you have to. This is common to do when it comes to car and home insurance, but you can also do it with your phone carrier, gym, or almost any kind of subscription based service (if you haven’t already canceled them).
In my own personal experience, I was using Cricket Wireless and the bill was almost $90 a month for two people. But I switched to Mint Mobile and now my bill is cut in half. This isn’t a plug or anything, I just wanted to highlight how much money you could save by simply switching companies.
How to Do Your Own Financial Spring Cleaning
How many of these tasks do you already do? Which ones do you find the most helpful? Asking yourself these questions can help you determine your own “financial spring cleaning routine”. Everyone’s finances look different, so not all these exercises will fit for everyone.
Adaptability is your best friend on the journey of improving your finances. I didn’t do any of these things until I learned and adjusted them to fit my own personal situation. This takes time, but with patience, you will get the hang of it and managing your finances will become a breeze.
I hope this list has been insightful and provided you with useful tips you can use to clean up your finances, not just this Spring, but at any point during the year. This list is by no means exhaustive, so if you have any other ideas for a good ol’ Spring Cleaning, let me know. I’d love to hear them and implement them!
