By: Sammi Coppedge, Marketing Assistant
Each spring, families all across the United States scramble to “spring clean” their homes. The winter is finally over and it’s time for them to blow the dust off their furniture and rid themselves of old, unused items in order to make way for the new. This same concept can be applied to your finances.
The spring cleaning of your finances is the perfect excuse to begin organizing and simplifying in order to improve your financial health in the coming months. Check out our top five ways to improve your finances this spring.
1. Clean up your accounts
The spring is the perfect time to begin cleaning up some of your various bank accounts and loans that you may have. If at all possible, try to consolidate any loans that you may have, close any unused checking or savings accounts or toss out old statements. If credit card debt is something you struggle with, consider paying off some of them and then closing them, so that you are not tempted to put as much on credit cards.
If you have been unhappy with your current bank or credit union, now is also a great time to find a new one and make that switch. Whatever your accounts may consist of, be sure to go through each of them and begin cleaning them up. The best thing you can do with your money is to effectively manage it.
2. Pay off your outstanding debts
One aspect of credit cards that many Americans take advantage of is the option to only pay the minimum balance on their credit cards each month. While this is convenient, the interest added to your overall balance each month can add up quickly and steeply. This goes for any other loan or debt that you may owe. Ultimately, you end up paying so much more on interest than you would have paid in cash originally. Interest isn’t a bad thing, seeing as many Americans do not have the financially capability to pay in cash for everything, however, it is important to keep these debts to a minimum in order to keep you from having to pay more.
One trick you can try is to start with one debt owed at a time. Focus on that account and paying it off. Maybe you pick your smallest debt owed and save up money to get it paid off. Or maybe you do the opposite and select your largest debt owed and focus in on cutting that balance down.
3. Go paperless
This day in age, everything and everyone is going digital, and your finances are a part of that. Many financial institutions offer incentives for members who switch to digital statements instead of paper ones. Not only does this help to make the world a little greener, but it can also help you. Many people check their e-mails or online accounts more often than they check their own mailbox. By simply switching to e-statements for your credit card, for example, you may actually be helping yourself out by ensuring your credit card payments are made timely and accurately.
4. Set up automatic bill pay
Spring cleaning can also be about making your finances more efficient, too. Consider enrolling in automatic bill pay for those bills you know that you are going to have each month. You can even do this for investments that you may have as well. Not only does this assist with avoiding late fees for not paying your bills on time, but with investments, it could help in that you never have to worry about forgetting to place money into your investment accounts.
The average person has so many bills and required fees a month; it is understandable that sometimes a person forgets to make a payment. However, you have the ability to overcome your forgetfulness through enrolling in automatic bill pay.
5. Gather all of your account logins into one safe place
One pitfall of the digital world is all of the different passwords and usernames a person has to remember. It becomes difficult when one account requires you to have 7 characters in a password, and the other requires 5 but two exclamation points and a number, for example.
Be sure to take an “inventory” of all your account logins and store them in one place. Be sure that this place is safe a secure, so that if someone were able to hack or login to your account they wouldn’t be accessible. This could be a password protected or encrypted document. You could also create a hard copy document of the logins and place it into a fireproof or secure box in your home. Another option is download an app that safely protects these passwords. They typically require a password to login. Some good app examples are Keeper Password, 1Password, and Password Manager.