Does Being Organized with Money and Finances Really Matter?
It makes no doubt that being organized with money and finances can make a difference.
The short answer to whether money organization really matters is yes.
However, getting organized with your finances is a vast topic that covers more than paying your bills when they are due and making an income.
Indeed, without proper organization, you can’t face unexpected expenses without dealing with dramatic consequences.
Defining the best financial organization plan for you depends on your unique situation.
It’s never a good idea to let peer pressure influence your organization.
Being organized with money and finances, ultimately, means defining your financial objectives, priorities, and needs.
As such, how you use your money should comply with your financial goals.
While it can be tempting to follow time-saving budgeting hacks for your finances, we strongly advise against it.
Taking the time to understand your situation and design the right money organization for you will make a difference in the long term.
What does it mean to be organized with money?
Being organized with your money and finances encompasses both long-term and short-term requirements.
Money organization is a simple practice that enables you to manage precisely how much you’ve got and what you can afford.
As a result, you can gain an overview of your finances in real-time and deploy money management solutions to preserve your financial health.
No matter how much money you’ve got, managing essential processes makes financial decisions easier and safer.
Otherwise, you are at risk of making poor decisions or falling behind on payments.
You can’t improve your budget if you don’t have solid foundations to support your objectives.
This is what good money organization provides to you.
Where do you start with organizing your finances?
Every financial organization plan should focus on sorting out money-related paperwork.
Financial paperwork can refer to a variety of elements, such as:
- RRSP contribution statements
- Credit card invoices
- Bank statements
Paperwork plays a significant role in organizing your money as it helps you track in big lines the necessary ins and outs of a time period – whether it is a month, a trimester, or a shorter period.
Typically, keeping a monthly overview of your financial paperwork can help you plan ahead.
What should you organize when it comes to your paperwork?
Financial health is the ability to answer two essential questions:
- Have I already paid for this?
- Can I pay for this?
Sorting out your financial paperwork will provide the information you need.
Additionally, it also makes tax requirements and tax reduction calculations a lot easier when you’ve got all the information at hand.
With this in mind, your paperwork should be divided into meaningful segments.
Some choose to file their statements separately and keep track of what needs to be paid and what has already been paid in dedicated folders.
Paper folders, electronic files, or even cloud bookkeeping tools are all suitable support for your paperwork.
Automation can change your finances
You can use smart automation to be better organized with your money and finances.
Indeed, automation solutions are readily available to enable people to keep track of on-going money tasks.
Some of the favourite automated tricks include:
- Automatic payment setups for recurring invoices and money transfer
- Free calendar reminders for payments or regular income, for instance. You can set these on Google Calendar easily.
- A to-do list can be helpful, with a tool such as Trello
- Online money management apps can also automatically adjust calculations based on your ins and outs.
Managing your cash flow effectively
As you gain an overview of your payments and income for a period of time, you can also preempt risks and big expenses, by moving your payment dates to a more suitable time during the month, for example.
Spreading costs throughout the month can also avoid burning through the income over a short time, making you more susceptible to take on a payday loan or rely on your credit card.
Balancing more effectively what comes in and out can leave room for additional financial goals, such as boosting your savings.
Keeping an eye on your spending
Debt occurs when you can’t effectively balance your expenses and your income.
In some situations, keeping track of unplanned expenses can prove helpful to reduce risks.
However, it isn’t sufficient to recover previous losses and repay standing debts without an income increase.
While being organized with your money and finances can provide a sense of safety and management, it may not be enough to eliminate debts.
A professional debt relief solution can complement your money organization strategy to help you get debt free in the long term.
Bring your money organization to the next level and book your free consultation with a trustee for dedicated debt advice.