With the end of the year coming up, you may be considering making some New Year's resolutions. One of the most common goals people make is to save more money. But before you make that a resolution, you should take some time to declutter your finances.
Review Your Budget
The first step to cleaning up your finances should be to review your monthly budget. You want to make sure it is up to date and not missing any items like subscription services or additional income. Check to see if any areas have spending leaks. Are you spending a lot of money on take-out food or clothing? This is the perfect time to figure out where you can cut back! You can also start using an online tool, like Schwab MoneyWise, to track your monthly budget. It will alert you on your spending habits and encourage you to save a few more dollars each month.
Organize Your Bank Accounts
Now that you have your budget squared away, it's time to look at your account balances. If you have your money spread out over many banks, consider consolidating into one. This can simplify the organization of your finances by seeing all of your accounts under one roof. You can even shop around and look for a better banking option that offers perks like no hidden fees or early paycheck deposits. That way you can spend less money on service fees and more money on holiday shopping.
At the same time, take a look at your savings accounts and figure out how you want to organize them. Think about establishing a separate emergency fund and sinking fund. If you're going to start saving up for a new TV or computer, you can stash away money into the sinking fund instead of stealing from the emergency fund. This ensures that when you do have an actual emergency, you will have enough saved up to cover it.
Switch to Paperless Billing Statements
Another fantastic way to cut down on clutter is to enroll in paperless billing statements. Not only is this eco-friendly, but it also helps you cut down on the amount of paper floating around your home, and it allows you to keep your statements organized digitally. Plus, some providers offer a discount for choosing paperless billing. While you're there, set up automatic payments too, so that you don't forget to pay any bills.
Cash in on Credit Card Rewards
If you have any credit cards that reward you with gift cards, travel miles, or discounts, cash them in now! The holiday season is the perfect time to convert those rewards into gifts for friends and family. Plus, you can use the leftover balances to pay off your credit card bill. The less money you spend on those things, the more money you can save for your New Year's resolution!
