DebtFreeAmerica has set January as Financial Organization and Goal Setting Month. Organizing and filing critical financial records for easy bookkeeping access and reference not only provides a visual of where your money is, but lets you chart successes and anticipate seasonal peaks in spending.
Goal-Powered Spending Toolkit (Setting your GPS for SUCCESS!)
- Private Bookkeeping Station: Set up a kitchen, bedroom, or spare space with a table and filing area for a once a week, 30 minute visit to your financial reality station. Have a large clip there to collect all statements and bills, or paystubs so nothing gets scattered around the house through the week. Even better, open your mail at that station so you can highlight due dates on your desktop calendar and clip statements together for when you make payments.
- Computer: ideally with QuickBooks software . DO NOT GO IN DEBT FOR EITHER OF THESE! A nice Dome Tax Recording book will work in helping you to see all income and expense each day-week-month-and year. Plus you get neat graphs to study and improve your spending. (Computer and QuickBooks could be your Reward Goal for saving with a cash purchase!)
- File Folders or Expanding File: label and use pinch clips to hold monthly items together inside each pocket: Pay stubs, Statements (filed under Creditor name) Monthly Bills (Utilities, loans, support), Bank statements, Eletroninc records, Cancelled checks). Keep all income tax related items for 7 years in banker boxes labeled from January to December for each year. Clips are perfect for holding receipts and statements in order of receipt.
- Desktop or posted Calendar Month at a Glance will let you Highlight due dates for each bill and pay day. Use an artificial date of 5 days early for sending bills out.
- Calculator. This simply lets you play with numbers, adjust your spending and savings goals, and escalate monthly and annual pay-offs.
- Writing Tools: Pencils/erasers, pens, markers, highlighters in various color codes to mark your calendar and provide an “At a Glance” reminder of ANYTHING you need to do each week.
- Shredder: Very nice if you live with roomates or have heavy traffic through your home and need to be sure discarded documents do not provide temtation for identity theft.
- Document Lock Box: Original financial, estate, and family documents should be kept in a fireproof box or simply a safety deposit box at your bank.
Make clearly marked copies of these items if necesssary. Someone genuinely close to you should be given an extra key, code, or lock combination with written permission to retrieve necessary documents in an emergency.—like you are too dead to get it yourself!
Where you set up shop will only matter to you. Just be sure it’s someplace you can sit and spread out your checkbook, record log (Dome Tax book), use a calculator easily, and hopefully enter financial data into your PC. Once a week is adequate at first, unless you need the daily exercise of checking to the penny how much is left for the week like I did as a single parent. The advantage to this was Income tax time, when I was able to present alphabetically everything to my Income Tax guy each January, and quickly provide dates and balances I had not listed in the tax log.
There is a real advantage to using some type of personal finance software. I did not have that, but have used one for our companies, even to write checks, make deposits, and record all income and expenses. The luxury of being able to analyze monthly , quarterly, and annual expenses from one season to the next can be a great advantage in seeing where you want to trim spending. Repeated patterns in seasonal spending and emotional spending traps stand out in bright colors on those graphs.
The best part of establishing this management system is the confidence you build in facing your spending giants and being ready for payments ahead of time. So many anxieties lift off when you begin taking command of where your financial road is going: A new strength in direction, purpose, and the renewed vision of “Every Dollar On Purpose!”