Declutter and Organize Your Finances

These easy tips can help you tidy up and organize your finances so that the next times you need a specific receipt for a warranty claim, numbers for your tax return, or other financial records, you’ll know right where they are.

Toss what you can.

The fewer financial documents you have, the easier it will be to stay organized. So what can you toss now without regretting it later?

You can generally shred your sales receipts as soon as you reconcile your checking or credit card statement, as long as you do not need the receipts for tax, warranty, insurance, or return purposes.

You can also generally shred bills, such as your utility, cable, and phone bills, after you receive the next bill verifying that you prior payment was processed properly, unless you need the bills to support a deduction on your tax return.

Organize the rest.

Start by sorting your financial records into categories and subcategories to make it easier to find specific records in the future.  Choose categories that make sense to you, and then stick with them. For instance, you might first divide your records into broad categories, such as tax, insurance, investments, and so on. You might then break those broad categories into subcategories, such as 2021 tax returns, to help you locate the specific document you need even faster.

Create a landing zone for new records.

As bills, statements, and other paper records flow into your home, it’s a good idea to deposit them in one location until you have an opportunity to review them. Having a dedicated landing zone can help you avoid misplacing a bill or statement – and may help keep the other surfaces in your home uncluttered.

Choose a permanent home for your records.

Whether you decide to keep your records in paper or digital form, having a specific home for them can help you stay organized.

If you prefer to hand on to paper records, a file cabinet or file box in your home can be a good spot for most of your records. However, not every document should go into a file cabinet. Important documents that would be difficult to replace, such as a birth certificate, marriage certificate, property deeds, and vehicle titles, might be better off in a waterproof and fireproof safe at your home or in a safe deposit box at a bank. Documents that may be needed in an emergency, such as your estate planning documents, may be better off in your home safe rather than in a bank where there could be delays in accessing them. We recommend using our Estate Planning checklist to capture your estate planning information and location of that information.

If you prefer to go paperless, an organized group of files on your computer can do the trick. Just be sure to regularly back up your files to a portable hard drive or the cloud.

Stay on top of it.

After you review your statements, pay your bills, or deal with other financial tasks, immediately file the records you want to keep so a mountain of unsorted records does not build up over time. With a file structure already established, dropping your records into the proper locations should be simple.

With offices in Rutland and Williston, Vermont Copper Leaf Financial develops a customized wealth management plan designed to integrate every aspect of your financial life. Call us today at 802-536-1843 to schedule a strategy session and begin building your road map to financial success.

Article published in January/February 2020 edition of Eye on Money. If you would like to be added to our mail list please email jennifer@dh-cpa.com.