Select Page

The book by Marie Kondo, “The Life-Changing Magic of Tidying,” is inspiring families across the globe to eliminate excess household items in exchange for simplicity and peace-of-mind. Marie asks us to take a hard look at the tangible items in our homes and consider: Do they “Spark Joy”? We live in an era of excess; accumulating material items without developing a way to organize. But we also live in a digital era that enables us to keep EVERYTHING without considering whether or not it’s necessary!

With tax season at a close, there is another way to simplify your life– through tidying up your finances. When was the last time you sorted through your portfolio of digital and paper records that track your debts, expenses, savings, investments, and insurance? If you are like most Americans, chances are you have a file cabinet filled with outdated paperwork and a digital file on your computer or “in the cloud” with miscellaneous financial records.

Use the energy of “Spring cleaning” to your advantage and take time to sort through the items in your financial repertoire. Here are a few easy ways to tidy up your finances and reveal opportunities for change and improvement.

1) Scan it or shred it. The IRS recommends retaining your tax returns for 3 years after filing. If you’re storing older tax returns (especially in paper form,) you can scan and digitize them, or simply shred them.

2) Review your Retirement Accounts. Are you still holding onto several different 401(k) plans with old employers? Have numerous IRA accounts? Take a hard look to see if you can consolidate these funds into one account. Reporting all retirement assets within one account means less tangible and mental clutter to manage.

3) Insurance overview. Many times, we hold onto paperwork that is no longer needed simply because we are “afraid” to get rid of it. If you’re not sure if you really need to hold onto each insurance premium notice, double check with your advisor and see what you can eliminate to slim down your files. Looking at your insurance statements also gives you a chance to see if there are new policy options that may better fit your protection needs.

4) Investment alert. Review your investment portfolio to consolidate or eliminate duplicate investments, and check on your overall rate of return for your assets. Can you do better? Should you take more or less risk? Are there old account statements that you can shred? The organization of your accounts can be one easy step toward investor confidence.

5) Credit check. How many times do you quickly scan your credit card statements without reviewing each charge? Did you ever sign up for something on a monthly billing cycle, but pay for a product or service longer than actually needed? Maybe it’s time to clean up by eliminating those unnecessary recurring charges.

6) Pay down those debts. If you’ve already reached your emergency savings goal, use any excess money to pay down debts before booking that next vacation. It’s amazing how debt elimination can improve your state-of-mind and help you enjoy your next vacation that much more.

7) One-Stop Shop. Have you found your financial advisor soulmate yet? Make sure you find an advisor who understands the full scope of your financial picture and can help you sort through the maze of complexity. Don’t get overwhelmed by stacks of paper statements or the barrage of emails – consult with your advisor. A good advisor can be your one-stop shop toward an organized, simplified financial portfolio.

If you have questions about tidying up your finances, contact the advisors of Planning Solutions Group for assistance.