It seems that one of the great obstacles to making a budget is organizing bills. Along with organizing your bills comes organizing all of your other financial and tax related information.
In order to maintain a healthy financial outlook, you must organize your finances. Maybe this could be a new resolution for you to start today. It doesn't have to be the start of a new year to have a resolution. Resolve today to organize all of your financial information. If you start today, you can have it done in a week, working at it only a few minutes per day.
This is really the key to the whole system; spend 5 - 10 minutes per day, every day, organizing your finances. It shouldn't take more than that. You will want to record all of your purchases for that day, pay any bills that are coming due, either write the check or make electronic transfer, file away any tax related items and shred any information that you do not want to keep. If done on a daily basis it really doesn't take much time at all. It becomes burdensome when left for days or weeks at a time.
Here are some suggestions to help you in organizing your finances:
- Choose a way to keep track of your finances. It doesn't matter if you use a ledger book, a software program, or an on-line system. What matters is that you find a way that works for you and that you use it. Be sure that you understand the pros and cons of each system before you settle on one; it is less than convenient to switch financial tracking systems once you have started.
- Have a single convenient place to collect receipts. Each day when you come home, take the receipts you have collected and put them in this one special place. Make this a habit.
- Enter your receipts. One person needs to be responsible for entering your receipts into your ledger/software program/on-line system. If you are single then it is you. If you are married than it can be either the husband or the wife but there needs to be mutual agreement as to who will do the recording. Should make a great topic of conversation around the dinner table.
- Write any checks for bills that are coming due or pay them electronically. A large drain on many people's income is the late payment fees associated with many credit cards. Some people could go out for a very nice dinner with the money they would save from paying their bills on time.
- File all statements and tax related receipts. One way to do this is to get a plastic box the size of a shoe box and keep your statements and receipts in there. You can also get large index cards and make monthly dividers. Put a label on the box indicating which year the receipts and statements are from. At the end of the year you can put it in some longer storage area. I would recommend keeping your statements for at least seven years for tax purposes. After that it would be wise to shred them.
- Shred all other receipts. With identity thefts significantly increasing year after year, it is a very good idea to shred all documents with any identification on it; particularly receipts.
Diligence Is Key!
Organizing bills is not difficult to do. The "hard" part is creating a new habit and being diligent to do a little bit every day. By managing your finances on a daily basis, you have more peace of mind because you always know exactly where you stand and you don't have a pile of bills always waiting for you.
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