How to Completely Organize Your Finances and Money. When you start to think about your money, the first thing you should do is get things in order. You need to get your money in order so you can make informed decisions about what to do with it next.
Over the years, I’ve done everything I can to keep my money in order. I’m talking about keeping track of my bills, wills, old tax returns, business papers, and other things. Every year, it seems like I have to keep more and more “stuff.” Because of this, I am now quite good at keeping track of my money.
Today, I’m going to show you how I organize my financial life, and you can as well. I divide it into three parts:
- Keeping Your Financial Accounts Organized
- Tracking Your Live Documents (like bills)
- Organizing The Stuff You Have To Keep
Let’s get started.
Keeping Your Financial Accounts Organized
The first thing you need to do to get your money in order is to make a list of all your accounts. You can do this in three ways: with a basic spreadsheet or list, with software, or online.
You need to think about how to budget for your personality when you start. This includes employing the tools that work best for you, whether they are technological or not.
You merely need to make a list of what you have before you begin. You should think about all of what follows for accounts that have money in them. That’s the most important thing: these accounts are worth money, not insurance or other financial “things.”
Banking
- Checking
- Savings
- Certificates of Deposit
- Money Market
Debt
- Credit Cards
- Auto Loan
- Mortgage
- Personal Loans
- Student Loans
Investments
- Brokerage
- Peer-to-Peer Lending
Retirement
- 401k
- 403b
- TSP
- IRAs
Once you have all of these accounts listed, it’s time to get them organized so that you always know your balance and any transactions that take place. The three ways to go about it are pretty straightforward:
The Spreadsheet or List Method
This is the traditional way to keep track of everything. You basically maintain a spreadsheet or list of all your accounts, and you update it manually every month as you pay your bills.
This method takes more work than any of the other methods, and it’s hard to get real time data unless you’re going online and checking your accounts. Most people that use this method rely on paper statements and reconcile them when they arrive.
One of the best spreadsheets I’ve found is called My Financial Life on One Page (FLOP). It’s a free download, so check it out.
The Software Method
This has been the cornerstone of financial organization for the last 10 years – using software to keep track of all of your accounts. The most popular software for this is Quicken Classic, which I use myself (just don’t get Quicken for Mac).
However, there are alternatives, like iBank (which works for Mac).
The great thing about the software method is that you can automatically update all of your accounts, so it alleviates a lot of the manual work involved. First, you take your list of accounts (that you created earlier), and you input them into the software. Next, you connect it to the online service using your online name and password. Going forward, you can use the software (like Quicken Classic) to automatically download recent transactions and update your account balances. Finally, these software tools have more reports and tools that can help you monitor your money easier than with a basic spreadsheet.
The Online Method
Over the last five years, online services to help you keep track of your accounts are really becoming popular. Check out our list of the best Quicken Alternatives.
These services work just like Quicken, except they are online, and they are FREE! Once you add in your accounts, these services will update your balances and make recommendations on how you can save – which is how they make money (through services and advertising).
Tracking Your Bills And Other Documents
Alright, now that you have all of your account balances in one place, what the heck do you do with all that financial mail you get? You know, the bills, medical statements, and more? You have to deal with some now, and some you just need to file for later.
This is all about having a system. For our family, the system is very simple: we have an inbox on our desk that we clear on Friday nights once the baby goes to sleep.
The goal is to make sure that you clear out his inbox every week. You have to take action on these documents.
Sometimes the action is very easy, you just pay the bill. I prefer to use online BillPay to send all of my payments, so we typically have Quicken and our bank’s website open on the computer while we’re paying our bills.
Once we clear out the inbox, we file away the statements and throw away the trash. We also now scan in all of our files digitally to avoid saving what we don’t need.
But how to we file the statements?
Managing Your Financial Files ( How to Completely Organize Your Finances and Money)
Managing your financial papers is the last step in the financial organising process. You make so many documents over the course of a year that it’s crucial to stay organised. You will usually get a monthly bill for each of the utilities you have, a monthly account statement for each of the accounts listed above, copies of your tax return, insurance statements, and more.
You can throw away some of these things after a short time. You can throw away most bills after a year. But there are some things you need to retain for a long time. The IRS says you should save your tax returns for at least three years, but it makes more sense to keep them forever.
The system has tabs for all the main categories you need to keep, along with instructions on where to put things and a Quick-Find index at the top.
You make a manila folder for each account inside each tab. In “Auto,” for example, the first tab shows a manila folder for one of our cars, the Honda Civic. You can maintain a copy of your registration, insurance, and servicing records in each tab. That way, all the paperwork you need to sell or trade in is in one place.
This is also true for banking, investing papers, and even pay stubs from your “Employment,” which are almost in the middle of the picture.
Every January, I make it a point to go through and get rid of any old things I don’t need anymore. I think this is the finest approach to keep my money in order.