- Have you recently paid a bill late because you misplaced it?
- Do you have a recent copy of your credit report?
- Do you know your credit score?
- Do you have a list of all accounts, numbers, online IDs and passwords?
- Do you have a list of all retirement accounts and life insurance policies including beneficiaries?
- Do you have wills, living wills and durable power of attorney documents?
- Do you have a specific financial plan for paying down your debt and building your savings, with specific dollar amounts, goals and dates?
Here are a few steps to help better organize your financial life.
Organize Paper Clutter
Those piles of papers, bills and statements cluttering the kitchen counter have to go. Replace it with a filing system organized by account and category that includes folders for bills, tax documents, statements and personal mail. Then put the filing system to use by filing your bills and statements as these come in rather than letting them pile up on the counter or desk. The important thing is to use a system that works.
Close out your checkbook register at year-end and start a new one beginning January 1st. File the register from last year with the 2010 tax statements you will need for your 2010 tax return. Use a multi-file box for your tax return and related statements. These come preset for this purpose.
Keep insurance policies, wills/trusts, birth/marriage certificates, passports and other hard to replace documents in a fireproof safe box. Also, keep a back-up copy of the financial records on your computer here. You can get a fireproof box online or from retailers like Wal-Mart, Home Depot, Lowes, etc. for about $30 to $150, depending on the size. Keep this in a safe place in your home.
Use a safe deposit box at your bank to store only valuable and irreplaceable documents and items. There are certain items that should not be stored here, your will being one of them. That's because at your death, the bank will seal off access to a safe deposit box until the court approves an order appointing a representative to oversee the opening.
I'll be back in a few days to provide more simple and effective ways to organize your finances. If you have a favorite tip of your own don't keep it to yourself....leave a comment for all to read.