So, how does one go about cleaning up their finances? Easy. Just follow the steps below.
1. Check Your Credit Scores
The beginning of the year is a great time to check your credit score, and you have no excuse because it’s free, baby!
What you’re looking for are adverse accounts, which will show you if you were late on a payment or have something in collections.
My credit report looked great this year, but last year I received quite the shock because the LIBRARY – yes, the public library – sent me to collections for not returning a book. It was a huge pain, and I had to go through my storage to find the book, send it back to the library, and then it was taken off my credit report.
So, even if you are savvy with your finances and think your credit report is perfect, you just never know what you might be missing. Also, return your library books because those librarians mean business.
2. Find a System To Make Your Taxes Organized
Every time I do my taxes, I wish I would have been more organized the year before.
Since this will be my first year as a self-employed business owner, I have extra motivation to ensure that all of my details are crystal clear. I do not want to spend 2015 trying to find receipts or remember a business expense that happened months before.
My organization was okay with my taxes this year, but it could have been better. If you are in the same boat, take the time to develop a system now in the beginning of the year, and set aside an hour or two at the end of each month to ensure you have documentation for all the big things that happened that month.
3. Finally, Spring Clean Your Finances by Automating Your Savings
We’ve chatted about this before, and I know that not everyone agrees with automating your finances. So, even if you don’t want to do that, at least set aside a time to put money in savings each month. This includes your general savings and your retirement savings. I love that money gets automatically put into my IRA and buy orders automatically go through every month. It’s one less thing I have to think about.
Of course, I had to make phone calls to the bank to make sure that everything was set up for 2014 and that it was all organized to come out on the right dates. It took a good chunk of time to set it all in motion, but now that that part of my financial life got the spring cleaning treatment, and I am happy.
There are tons of other ways to spring clean your finances, from tweaking your budget to finding the best way to track your spending. How will you spring clean your finances this year?