With any luck, soon the birds will be chirping, plants will be blooming, and your lawn will finally start to reclaim its vibrant green.
When we think about Spring, we think about renewal and reclaiming our optimism as the world around us springs back to life after a long, cold, and gloomy winter. That goes for the way we look at our finances too. Spring’s the perfect time to unclutter, reorganize, renew, refresh, and reenergize your relationship with your money for the months to come.
Here are a few tips to help you successfully take on your financial spring cleaning.
1. Get Rid of Your Old Stuff
We all accumulate far too much. This spring, go through every room, closet, and storage space. When in doubt, throw it out, sell it online, or give it to someone who could use it. What you can’t sell, donate to a charitable organization. Make sure you keep your donation receipts in case you decide to claim a tax deduction for charitable giving. You’ll need to itemize each of these deductions come tax time.
2. Clean Up Your Paperwork
Just like all the other stuff we accumulate, we’re all sitting on decades of old paperwork, defunct files, and records that we no longer need. So first, sort through your files and shred whatever you no longer need. Then, it’s time to go digital. Borrow or rent a scanner to save images of the documents you need to save. You can always reprint them later if necessary. Store any original documents you may need to save, in a fireproof safe. Then be sure to save your files in multiple places like a cloud storage service, a local hard drive, and a backup drive.
3. Revisit and Reset Your Financial Goals for the Year
Check in on your own personal goals. Do you have as much cash set aside in your emergency fund as you’d like? Are you carrying any credit card balances, and paying high interest rates? Are you putting as much toward your tax-advantaged retirement accounts as you’d like?
Financial spring cleaning offers a perfect opportunity to check in on your progress. You can tweak and adjust your spending, savings, and investments as needed to put yourself on track for hitting your short-term targets for the end of this year.
4. Review Your Monthly Budget
An emergency here, an unexpected opportunity there and all of a sudden, you’re spending more and saving less than you planned. Reframe how you look at budgeting. Instead of thinking in terms of sacrifice, think in terms of prioritization and intentionally designing your life based on what’s important to you. If you don’t currently have a budget, now is a perfect time to make one. Talk with a Canopy Financial Coach to help get you started.
5. Clean Up Subscription Services
List every single subscription you pay for, whether monthly or annually — video and music streaming, gym memberships, meal boxes, hard drive backup services — everything. You probably pay far more than you think. There are even a few online services and apps to help you keep track automatically. These services sync with your bank and credit card accounts securely to help you manage recurring charges.
Then ask yourself: Do I use this service? Does it add to the quality of my life? If the answer is no, cancel it. You can always rejoin if there’s a special event, a movie you want to see, or another compelling reason to pay for it.
7. Plan Your Retirement Contributions
Whether you want to max out your IRA or 401(k) or just take advantage of matching contributions, now is a good time to plan out how you’ll achieve your target retirement savings this year.
8. Automate Your Savings
Automate your savings by splitting your direct deposit into both your checking and savings or investment accounts. You can also set up automated recurring transfers to take place every payday. Set your mortgage payment to be withdrawn automatically each month and then pay more than the minimum payment if you want to pay off your mortgage early.
Of course, there’s no end to the things we can do to make sure our financial lives are in harmony with our goals and desires. But taking time to get in tune with the season of renewal can lighten our load and help us feel better organized and more in control of our financial futures.