5 Steps to Get Financially Organized for the New Year

by Erica Gellerman, The Worth Project

While most people think about ushering in the new year with a clean and organized home, they’re overlooking one area that needs some serious de-cluttering: finances.

Just as quickly as your closet can get out of order, so can your money. While technology has helped us ditch the need to balance our checkbooks, it’s also made it easy for us to get a little sloppy in the money department.

If you feel yourself getting a little overwhelmed with money clutter, the new year is a perfect time to get organized. Here are five steps to help you do just that.

1. Create a financial table of contents

With so many companies offering auto-pay on bills these days, it’s easy to lose track of what you pay for and when it’s due. A financial table of contents will keep you organized. This is simply an easy-to-reference master list of every bill that you pay. With this table of contents you’ll no longer ask yourself mid-month, “When does my cell phone bill get paid again?”

Creating your table of contents is simple. I like to use a spreadsheet and list out all of my monthly bills, the corresponding due date, and details about how it’s paid (does it get paid automatically or do I pay it manually?). Any irregular bills, like annual home insurance premiums or bi-annual property taxes, get listed below that. If things change — for example, if I get a new credit card — I simply update the sheet.

2. Set up an easy way to monitor your money

Though this isn’t a fun thing to do, it’s important to frequently monitor your money. Not only does this help keep spending in check and ensure that you don’t rack up any expensive overdraft fees, but it will help you spot any potentially fraudulent transactions.

Set a time to check your accounts monthly at a minimum — ideally you’ll check them more often. Scroll through all of your financial accounts: your checking, savings, credit cards, and investment accounts. Make sure that every transaction is one you actually made and flag anything that jumps out as surprising. Flagging fraudulent activity early can help you spot issues and get them taken care of before it becomes a big problem.

To keep your spending in check, try this technique: as you’re looking through your transactions ask yourself if your spending reflects your values. If your top values are spending time with your family, eating healthy, and traveling, and you see that most of your money one month is going toward takeout food and late-night online shopping, there are probably better ways to spend your money.

If you don’t want to log into each different account every month, you can use a service like Mint, YNAB, or Personal Capital to aggregate all of your accounts and view them in one place.

3. Gather all of your policies

Don’t wait until a fire is burning on the hill behind your house to track down your homeowners insurance policy. Get a copy of all your insurance policies: home insurance, health insurance, auto insurance, and life insurance. Take the time to go through each policy that you have and save them — either digitally, physically, or both — somewhere safe and easy to access.

Just like everything Ladder does, accessing your Ladder life insurance policy is easy. Simply log into Ladder, head to your account page, and click “view policy.”

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4. Get ahead for taxes

April 15th will be here before you know it, so while you’re already getting an organized start to the new year, get some things together for your taxes.

Although you likely won’t have any of the important documents yet, like a W-2 or 1099, get your personal things organized. Are there any deductions that you may be able to take this year? Gather your receipts for medical expenses, charitable deductions, and anything else that you’ll need when tax time rolls around.

5. Keep passwords safe

Ditch your easy to guess passwords (“Password123” isn’t exactly difficult to crack) and keep all of your passwords securely saved. Don’t run the risk of having your financial data exposed by using these generic passwords for your accounts.

If you’re worried about remembering your new hard-to-guess passwords, consider using a password manager. A password manager is a service that generates strong, unique passwords for each of your online accounts. It keeps all of these passwords stored for you so you don’t have to worry about remembering them.

Although getting your paperwork and finances in order might take a little time, it will pay dividends in the long run. Follow these five steps and you’ll be well on your way to an organized and fresh start to 2019.