Spring cleaning has long been a Judeo-Christian tradition. In the Book of Exodus, the Israelites are told to leave Egypt quickly and leave no trace. There wasn’t even time for the bread to rise. To this day, many of us use spring as a time to deep clean our homes. There is even a National Spring-Cleaning week that occurs annually at the end of March.

People are encouraged to wash kitchen curtains and sweep behind the refrigerator, but it’s also the perfect time to make sure your financial house is in order.  In this digital age, the number of items to review can feel overwhelming, especially if this is something you have not kept up with regularly. However, decluttering and setting up systems now will make it easier later.

It starts with organizing and being intentional.  

  • For example, what are your automatic payment dates and amounts?
  • If these dates don’t work, they can be changed to align with deposits. If auto payments aren’t set up, is it something to consider?
  • Are auto payments included in the budget?
  • Do you have a budget? There are many ways to set up a budget but the most common is allot 50% for needs, 30% for wants and the last 20% for savings, investment and debt.1 These percentages can vary based on your household/individual needs.
  • The most important part of a budget is to track actual spending. There are many ways to accomplish this task including computer spreadsheets, expense tracker apps and many online banking apps offer spending trackers. If you want to go the analog route and use pen and paper, there are a variety of budget planning notebooks on the market.

Setting a savings goal is helpful.

  • Savings goal calculators can be found online but one tip is to sign up for your bank to automatically put money into your savings account when a deposit is made to your checking account.
  • This is especially useful if your salary or Social Security automatically deposits to your checking account.
  • Even having a small amount, such as $10, can add up over time.
  • Setting up an emergency fund should also be part of the budget process, so you have funds on hand for those unexpected medical and vet expenses or auto and home repairs.

On the other end, taking inventory of debt is also important.

  • Establish bill paying processes if there isn’t one in place.
  • Make sure you’re getting the most from credit cards in terms of rewards programs and interest rates. Call the companies and see if they have lower interest options. Dig deep into the budget and look at where spending is happening.
  • Groceries and food in general, are where budgets often go astray. How much take out or eating out is happening?
  • What was added to the grocery cart that wasn’t needed? Is a cheaper brand an option? Do a pantry challenge and use only what’s in the house for the next week.

Declutter expenses.

  • Deleting tempting shopping apps helps to cut back on non-necessity spending.
  • Ask for lower rates on cable, Wi-Fi, cell phones, insurance, and the like.
  • Examine statements for mystery charges like monthly donations you may now decide to discontinue.
  • How many streaming services are you subscribed to? Consider rotating them and using only one or two at a time.
  • Look at all subscriptions and make sure they are still being used and there aren’t duplicates.

Review your credit report.

  • Look for inaccurate information and possible identity theft.
  • Also review beneficiaries. Make sure they contain accurate information.
  • While examining insurance policies see if they needed updating. Does the insurance coverage meet the current need?
  • Should more money be added to retirement plans? Is it time to set up a retirement account if one doesn’t already exist?
  • Are current accounts scattered among different financial houses based on previous jobs? This is a good time to roll them into one.

Create or update an estate plan.
Less than 41% of Americans have one2, but it is important to have a plan to leave instructions for how your assets, property or possessions are distributed in the event of your death. Consider the following:

  • How your finances will be managed in the event you become incapacitated.
  • Guardians and financial care of any minor children.
  • Implementation of an estate plan, which ensures assets go to chosen beneficiaries and minimize income, gift and estate taxes.

Lastly, this is the perfect time to change all passwords.  To keep track of passwords consider setting up a secure spreadsheet or using a password app.

Don’t limit financial clean-up to spring. Like dusting, managing finances is never ending. If the new systems don’t work initially don’t get discouraged. Adjust and try again.

[1] https://www.realsimple.com/work-life/money/money-planning/spring-clean-your-finances

[2] https://www.doughroller.net/loans-credit/debt/ways-to-spring-clean-your-finances/