It's That Time of the Year: Getting Your Finances in Order

Now that you’ve recovered from holiday spending, how does your bank account look? If it’s making you a little weak in the knees, now is the time to get things in order. At the start of this financial year, here are three steps you can take now to make tax time and your budget a bit easier:

1. Start trimming down your holiday spending.

With so many great deals, good specials, and yummy treats throughout the holiday season, it’s easy to get into “spending mode” and keep on treating yourself. It’s time to cut back, but just like with dieting, if you cut out all of your extra expenses at once you’re going to feel a crunch. Instead of cutting yourself off altogether, take a look at your spending and decide how much you can really afford to “blow” each month. Make a separate account for that money, or just make a habit to have some cash on hand. Once that money is gone, no more extra stops at Starbucks or “one more thing” spending at Target.

2. Gather all of your tax documents.

Don’t scramble the first two weeks of April! Get your pay stubs, statements from health insurance, and more in order and see what you still need to gather. Typically, your tax necessities won’t change that much from year to year unless you’ve made a major change like buying a home or having a baby. Contact your accountant or find a generic list of common tax documents online that you can use to prep your paperwork and get organized.

3. Concentrate on where you struggle the most.

There’s a finance problem for everyone – whether it’s balancing your checkbook or spending on the credit card when you shouldn’t. That’s why it’s so important to figure out what is holding you back and concentrate on that. For example, if you’re never quite sure how much you’re spending on what, try an online tool like Mint.com to easily track expenses. If late payments are a problem for you, register for online bill pay. Trying to manage debt? Focus on making large payments to reduce the money you spend on interest. There are so many areas of personal financial management that you don’t need to be an expert on everything. Just concentrate on where you struggle the most to have the biggest impact on your financial picture.