To-Do List for Getting Finances in Order

How to get financially organized

Do you often find you’reFinToDoList_Featured scatterbrained when it comes to keeping your finances in order? More important, do you spend more than you can afford? More than one-third of adults do, and an estimated 70 percent of Americans are living from paycheck to paycheck. And that means it’s time to start really getting down to business about keeping more organized to avoid spending more than you should be spending.

“You cannot be in denial about finances,” Dr. Phil says. “It doesn’t matter what you think you deserve, what you think you need, even — and [it] certainly doesn’t matter what you want or desire. When you’re dealing with finances, you’ve got to deal with reality.”

Here are some top tips for getting financially organized:

Ditch paper – Most bills can be paid online, so you might want to take advantage of that, as too much paper increases the chance that things will get lost. If you use a scanner, you’re more likely to be able to keep things in order (plus, it’s better for the environment).

“Simply scan photos and paper documents to create electronic copies. By transferring all physical records into electronic format, you’ll be able to later print the records,” says Lynnette Khalfani Cox, author of “Zero Debt: The Ultimate Guide to Financial Freedom.”

You should also store at least one backup copy on a CD or memory stick. Not ready to go paperless completely? Invest in a paper shredder.

“It eliminates waste, and that’s pretty crucial,” says CPA and financial planner David Bendix, president of The Bendix Financial Group in Garden City, New York. “It’s smart, and it’ll help you get organized.”

Start a retirement plan – While you’re getting your finances in order, it’s a good time to set up a 401(k) or other retirement plan (if you haven’t already) to help you save for the future.

“Having a long-term allocation to equities is necessary for combating inflation in the future and making sure that you have enough money to buy the things you want when you are retired,” said iShares Asset Allocation Strategist Jane Leung. Try to invest as much as you can in a 401(k), and take advantage of whatever company matches available to you. If you don’t have access to a 401(k), you can open an IRA.

Be detailed about files – “Think about those files you access the most and the reasons why,” says Wayne Bogosian, president and managing director of the PFE Group, and co-author of “The Complete Idiot’s Guide to 401(k) Plans.” “Rather than dumping everything into a general folder called ‘documents’ or ‘photographs,’ break it down into primary and secondary folders.” That means being as specific as possible (e.g., “tax returns,” “credit/debit cards,” “insurance,” etc.).

“And don’t be an ‘e-pack rat,’” says Bogosian. “Chances are, that document you saved in 1997 isn’t going to do you much good today.”

Open an emergency fund – No one wants to find themselves strapped for cash, especially in an emergency. That’s why it’s wise to start building a just-in-case fund to help keep things in order.

“$1,000 would be the first goal to work toward,” says Tom Maynard, finance instructor at Converse College. “Then try to get to the point where it’s equal to one month’s take-home pay, and then two months’ take-home pay, and if you can get to where you have three months’ take-home pay, then you probably have reached a level that, I’m going to guess on this, but I’ll bet you 10 percent of the American public does not have.”

Keep a checklist handy – Start each month by making a checklist of each bill you know will be arriving. Keep the list in the same place at all times, and be sure to update it regularly. You can refer to it whenever you need to verify whether you’ve paid — or you haven’t paid — a bill. Whether via mail or email, not all important documents always make their way to you in a timely manner, so keeping a list helps you stay on track and notice if something wasn’t delivered on time (which can be a common occurrence).

We can help you get your finances in order – contact us today.

Used with Permission. Published by IMN Bank Adviser Includes copyrighted material of IMakeNews, Inc. and its suppliers.

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