It's time to clean out the clutter and organize your finances for the new year. Spring is a great time to take a look at your budget and see what needs to be changed or tweaked to get you closer towards your financial goals.
Tip 1: Look at what you spend.
This step is often overlooked for a quick and easy budget tweak. You need to know how much you are spending on food, clothing, entertainment, rent or mortgage, etc. in order to get a well-rounded understanding of your spending habits and where the money is going.
Tip 2: Set realistic goals for yourself and make plans to achieve them.
Setting goals for yourself will give you something to work towards as well as help keep your finances in check. By making plans of how you will achieve these goals, like setting a date by when they should be completed or putting money aside each week/month until that goal is met, it becomes more manageable and less of an expense mentally because the individual is working towards a larger goal.
Tip 3: Make a budget.
For many, making a budget can be confusing as they don't have the time or energy to sit down and figure out how to create one. However, with the help of online calculators, you can create a simple and easy-to-read budget that will provide you with a good starting point for your financial goals. There are also budget templates available for free online to help you get started.
Tip 4: Find your financial personality.
What works for one person may not necessarily work for another person. There are people who love to watch their investment account grow over the years, versus others that would rather have it automatically deducted from their paycheck so they never have to think about it again. There are also some people who feel wealthier by spending it all on fancy cars and clothes while others feel wealthier by investing in retirement funds and savings accounts. Understanding your financial personality will make monitoring your finances much easier.
Tip 5: Cut back and/or find other sources of income.
If your budget is out of whack, it's time to cut back on the spending and find other sources of income in order to make up for the difference. Hiring a financial adviser can help give you advice on what you can do to reach your financial goals.
Tip 6: Reward yourself for a job well done!
After completing some or all of the above tasks, reward yourself with something that will motivate you to continue this new found financial discipline. Some of you know that I love going to Disneyland and Universal Studios. Reaching my financial goals allow me to treat myself and my family to a trip to Disneyland or one of the other theme parks.
It may sound cliché, but spring cleaning and organizing your finances go hand-in-hand. You can't really get rid of the old clutter in one area without taking care of the other. So make this year a little more productive by getting those finances in order!
