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Spring Clean Your Finances in 5 Steps

March 28, 2016 4:45 am

Spring may be the “season of clean” at home, but it’s also an ideal time to organize your finances and commit to long-term financial stability, says Corey Carlisle, executive director of the American Bankers Association (ABA) Foundation.

“The arrival of spring motivates people to renew their surroundings, and what better way to focus that momentum than to check off everything on your financial to-do list?” asks Carlisle.

To go out with the old, in with the savings, Carlisle and the ABA recommend to:

1. Evaluate and pay down debt. Take a look at how much you owe and what you are paying in interest. If there are better rates available now, consider requesting a lower credit card interest rate or refinancing your mortgage. Begin paying off existing debt, whether that’s by chipping away at loans with the highest interest rates or eliminating smaller debt first. 

2. Review your budget. A lot can change in a year. If you’ve been promoted, had a child or became a new homeowner or renter, be sure to update your budget. Determine what expenses demand the most money and identify areas where you can realistically cut back. Develop a strategy for spending and saving and stick to it.   

3. Check your credit report. Every year, you are guaranteed one free credit report from each of the three bureaus. Take advantage of these free reports and check them for any possible errors. Mistakes can drag down your score and prevent you from getting a loan, or cause you to pay a higher than necessary interest rate.  

4. Sign up for e-statements, paperless billing and text alerts. Converting to paperless billing will help keep your house—physical and financial—more clean and organized, and will help protect you from fraud.

5. Set up automatic bill pay. By signing up for automatic bill pay, you’ll never have to worry about a missed payment impacting your credit score. You can set it so that money is withdrawn from your checking account on the same day each month.

“Taking stock of your finances and planting the seeds of new saving habits today will go a long way toward alleviating pressures on your pocket throughout the year,” concludes Carlisle.

Source: ABA

Published with permission from RISMedia.

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