GeneralMoney

How to Easily Organize Your Personal Finances

personal finance organizer

If one of your goals this year is to live more frugally, you definitely need to get your personal finances organized. Why? Because living frugally means being in control of your finances and you can’t be in control of them if they are a big unorganized mess. Trust me!

For years I lived without an organization system for my finances, and it really didn’t help me be in control of my money. When your finances are a mess it’s hard to do things that can save you money, like double checking your financial statements for errors, making sure your bills are paid on time, and keeping track of your bank balances so you have any dreaded overdraft fees.

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If you need to get your personal finances organized, here’s how to do it with easily and efficiently.

Make Sure You Have the Right Tools

Before you dig into sorting through your financial paperwork, you need to make sure you have the right tools to keep it organized. Afterall, the worst thing that can happen is that you get it all cleaned up today and end up with another big mess of paperwork a month or two down the road.

Everyone organizes things differently, but what I’ve found works best for me is having a filing cabinet, hanging folders, file folders, and labels.

Label each of your hanging folders according to your needs. Some of the categories I use are: home, auto, medical/healthcare, banking, insurance, income and taxes, and credit cards and other debt. Then I use file folders to create subcategories. For example, I have one file folder for each credit card. (Side note: As I get closer to debt freedom it makes staying organized easier as I have less to keep track of.)

Make Time and Space for Your Project

When I organize things, I like to lay it all out in front of me so I know what I’m working with. Then I make piles of like items, before finally putting things away where they go.

Getting your personal finances organized is no different. It’s going to take time and space to complete this project. Make sure you have a space to work on this project that is out of the way of your daily activities because most likely you won’t get it all done in one sitting. Going through financial paperwork can be a headache, so it might even be best to break it up into a few sessions so you don’t get overwhelmed and miss something important.

Shred Unneeded Paperwork to Prevent Identity Theft

While you are going through your financial paperwork, you are bound to come across some things you don’t need to keep. When this happens make a pile of paperwork to shred and a pile to toss. There might a be a few things in your “toss” pile, but overwhelmingly most of the paperwork you no longer need will need to be shredded.

A few years ago, I invested in a shredder of my own, like this one. This makes it easy to dispose of financial paperwork I no longer need. This way I don’t have to find somewhere else to shred it and I can ensure that it’s shredded  so my personal information is less likely to be used for identity theft.

Stay on Track

Once you have a system in place that works for you, the best thing to do is keep up with paperwork as it comes in. This will prevent you from having a paperwork pile up that takes a massive amount of time to sort. It will also cut down on stress, and will make it easier for you to find information down the road that can save you money.

Cutting down on paperwork is also a good way to make it easier on yourself in the future. You can pay most bills online and get e-statements that are stored online for several years. This will also cut down on the amount of paperwork you have to sort through and store.

If you have a lot going on financially, then you might want to use a system to track everything in one place. One such tool is Personal Capital, which is completely free. If you’re looking at a system like Quicken for your bills and finances, then look at these awesome alternatives that will work even better.

Give your system a once-over a couple times each year to make sure you are still on track and are only saving things that need to be kept.

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Kayla

Kayla

Kayla is a mid-20s single girl living in the Midwest, USA. She is focused on paying off her consumer and student loans, while simplifying her life and closet. You can join her on her journey at ShoeaholicNoMore or follow her on Twitter.

3 Comments

  1. January 13, 2016 at 11:45 am — Reply

    Most of my paperwork is digital these day but I do have some that I keep in a filing system in case I should ever need it. I also like to keep copies of important financial documents just in case they become relevant in the future.

    • January 13, 2016 at 12:41 pm — Reply

      I still like to have paper copies of things too. I guess that’s one thing about me that’s still “old school”. 🙂

  2. January 15, 2016 at 6:33 pm — Reply

    I normally get successful at sticking to my planner and I enjoy using my notebook planner than my digital planner. I find it fun and more encouraging once it is personalized, Kayla. This year, I just hope that I can stay on track all the time.

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