Spring cleaning isn’t just for your home; it’s also an excellent time to give your finances a refresh. Whether you’re looking to get a better handle on your budget, pay off debt, or build your savings, taking some time to review your financial situation and make some changes can have a big impact.
Review Your Budget
Perhaps you started the year off strong by staying true to your budget, but you’ve fallen behind in recent months. Does your budget need a refresh? Look at the areas in which you are overspending, and make a plan to correct them in the future. Having too strict of a budget can set you up for failure and stress, so it’s important to make an accurate assessment of your spending habits rather than attempting to meet an unattainable goal. If your previously determined budget is no longer feasible, now is the time to make adjustments.
Pay Off Debts
If you have been avoiding debt, spring is the perfect time to sit down and get a full sense of what you owe. Ignoring your debt will only make it grow larger! Take inventory of your debt and decide what needs the most immediate attention. Prioritize payments according to billing due dates and interest rates. Create a timeline for yourself for exactly when you would like the debt to be paid by, and how much you need to contribute over time to reach that goal.
If your important documents are not in order you may find yourself frantic when you need to access them in the future. Prevent these issues by arranging your physical papers in a safe and secure spot, and digitizing wherever possible – this way, they are searchable! Prepare yourself by keeping your birth, marriage, and death certificates, social security cards, passports, and documentation of major loans and insurance policies in a firebox. Securely dispose of documents that are no longer necessary, such as paid utility bills or pay stubs from previous years.
Check Your Savings
Whether your main priority is your retirement fund, your kid’s college fund, or planning a major life event, take the time to check in on all of your different savings accounts. If you notice some are not on track with your goals, plan how you will bolster these funds over the course of the year. One of the most important, but easily forgotten, aspects of a sound financial plan is an emergency fund. This money should be easily accessible, and significant enough to protect you from unexpected crises. Medical emergencies, car problems, and home repairs can severely affect your budget. Having cash set aside for such events will prepare you for the worst possible scenario and decrease your stress level, as you will be confident in your ability to handle anything life throws your way.
Look at the Big Picture
Once you have taken inventory of your progress so far this year, think broadly about how you are progressing in your long term financial plan. Some years are better than others, so it is okay if you are not exactly where you hoped to be by this point. The most important thing is to maintain a sound plan that will guide you on your path to financial freedom. Checking in with your overall progress in relation to your goals is a great way to round up a financial spring cleaning, and ensure that you are on the right track!
Blakely Financial, Inc. is an independent financial planning and investment management firm that provides clarity, insight, and guidance to help our clients attain their financial goals. Engage with the entire Blakely Financial team at WWW.BLAKELYFINANCIAL.COM to see what other financial tips we can provide towards your financial well-being.
Commonwealth Financial Network® or Blakely Financial does not provide legal or tax advice. You should consult a legal or tax professional regarding your individual situation.
Securities and advisory services offered through Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser.