Is your financial life organized? If not, here's an article from Yahoo that will help you get everything in its place. The piece starts out detailing why you need to have your finances organized:
There are concrete reasons to keep your financial documents in order, no matter what your personality type.
For starters, it's a cinch that you'll have to put your hands on some of these papers in the future--to file your taxes or an insurance claim, for example--so it makes good sense to keep them in a logical and readily accessible location.
It's also essential that your heirs be able to locate your important financial documents.
Finally, keeping your financial paperwork organized will tend to keep you in touch with your personal balance sheet. If you're filing your financial documents as you receive them, you'll be forced to reckon--whether you like it or not--with how much you have in assets and how much you owe. You will thus have a better sense of where any potential trouble spots might lurk.
Then the article give five easy suggestions for getting your financial records organized:
1. Learn what to stash and what to trash. There's a reason many of us put off organizing our financial paperwork and tend to hang on to too many documents: Throwing out a financial statement that we might need for insurance or tax purposes has more serious repercussions than pitching a sweater that just might come back into style. But few of us have the space, let alone the discipline, to squirrel away every last receipt and statement. So throw away those unneeded papers. Buy a shredder and use it to destroy the myriad documents that include your name or other personal information on them.
2. Know where to put what you keep. If you have a filing system that works for you, great--proceed to Step 3. If you don't, I'd recommend a three-tier scheme: one for documents that relate to the current year; one for papers that you need to hang on to but have no immediate need for; and a safety deposit box for irreplaceable documents.
3. Create a master directory. Create a financial directory in case something should happen to you. On it, you should list all of your financial accounts, from banking to insurance policies to investment accounts, along with your passwords and the names and phone numbers of any advisors that you use. Give this document to a close relative or trusted friend, or create an electronic document (in a very secure location on your computer!) and provide that friend or relative with specific instructions for gaining access to it if need be.
4. Stay on top of incoming mail. Because credit card solicitations and other printed statements often include your name, birth date, account number, and/or Social Security number, don't discard them without shredding first. If you don't use an electronic bill-paying system, I'd recommend logging any incoming bills on to a calendar as soon as you receive them. Note the date on which the bill should be mailed, who you owe, and how much. When you sit down to pay your bills for the coming week or month, this approach will help to ensure that nothing falls through the cracks.
5. Take advantage of technology. Scan important documents and store them on a disc to reduce the amount of paperwork for which you need to find a physical home. And electronic bill-paying systems and automatic debit programs can also help simplify your financial life. Not only can they greatly reduce the time you spend on financial paperwork, but they also ensure that your bills get paid on time. (On the flip side, using an automatic debit program makes it essential that you stay on top of whether you have enough money in your account to cover outgoing bills.)
Great tips. Apply them and you'll save both money and time!!
Comments