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A Step-By-Step Guide to Organizing Your Finances

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A Step-By-Step Guide to Organizing Your Finances

Organizing your finances may seem like a tedious task to begin, and you might even wonder how to start. Here are a few tips to help guide you in tackling the process step by step. 

Set financial goals
 

To get a clear understanding of what you’d like to accomplish, establish several financial goals with plans for how to reach them. First, set your long-term goals, such as college or retirement saving. Short term plans could be upcoming home repair, down payment or an expensive vacation. Setting and executing such a plan will help you with organization and staying on track. Use our guide for setting S.M.A.R.T. goals.

Track spending
 

Tracking your spending can help you to better understand how to organize what is coming in and what needs to be paid out each month. There are many apps to help, especially while you are on the go. Most are easy to use, such as Mint, Wally or YNAB (you need a budget). Old National also offers a money management platform within our online banking. If you prefer the more basic approach, you can also download our worksheets to help you track spending and budget

Create a bill calendar
 

A bill calendar will help you know exactly when bills are due each month. Using this tool as a working document will help you become more organized and timely when paying bills. Consider using online bill pay, a service that automatically creates a bill calendar where you can see what is upcoming and set alerts or recurring payments. 

Automate everything
 

Automatically paying yourself and expenses will ensure your savings goal is met and bills are always paid on time. A great way to do this is to set up a basic savings account and have a portion of your paycheck direct deposited to that account. Another option is to set up an automated monthly (or more often) transfer of a certain amount from your checking to savings account. To automate paying expenses, use online bill pay to set up recurring payments or talk to the billing company. Most can set up payments to be automatically deducted from your bank account. 

Use financial software
 

Financial software will help you store important data and cut down on paper storage, while doing most of the tracking and sorting for you. The Money Management platform within Old National’s online banking is one option to try.

WANT AN ORGANIZED OVERVIEW OF YOUR FINANCES?
 

View all of your accounts, including those with other financial institutions, in one convenient location! Money Management makes it is easy to track your budget, set goals, monitor transactions and categorize your spending. Best of all, it’s part of Old National’s Online Banking, giving you complete control of your financial life, wherever you are! 

Shred documents
 

Shred old documents, such as bank account and credit card statements along with receipts the month after you have reconciled your statement. Monthly bills should be shredded after they have cleared your checking account. Also, to reduce the amount of paper, consider enrolling in paperless billing and eStatements. Shredding documents also reduces the possibility of someone stealing your personal information and using it for identity theft.

Related: How to Start Your Savings Plan

Store documents
 

Filing documents, according to retention date or order of importance in a safe deposit box or fire proof safe, will help keep vital items protected and easy to retrieve. Electronic filing systems may also be preferred; however, you would need to be diligent about scanning items into that software so that paperwork won’t pile up.

Update and consolidate
 

Review all dormant checking, savings and credit card accounts that aren’t in use; consider consolidating. Previous employer 401k or 403b plans, and investments, should also be updated and consolidated. Speak to a financial advisor on the best options to consolidate investment accounts.

Review insurance policies
 

We recommend reviewing all policies annually, including auto, homeowners, renters and life. Ask your agent to review policies to ensure you are covered at correct limits. There are some agents that do this automatically.

Review credit report
 

This can be done annually or one credit report per month at no cost through www.annualcreditreport.com.  You can order all three credit bureaus, Equifax, Experian, and Transunion at once, or you can order one of each over the course of a calendar year. I highly recommend adding this to your calendar to ensure you are reviewing for any errors or fraudulent activity. I have worked with many clients who are surprised to see incorrect information on their credit reports or that their identity has been compromised. We encourage all clients to set up alerts, or even place a security freeze on their reports, as an added safety precaution.

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