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Here’s how to organize your finances now
What if you could organize your finances simply and easily? Would you do it? Well – good news! Everything you need is below. In the meantime, get your free copy 5 building blocks for a happy gay life Here for a bigger, badder, happier life.
Can’t it be easier? Yes
Travel. Traffic. Keeping track of the characters on Game of Thrones. Steer.
These, like many things in life, could be simpler. Do you know anything that’s easier? How to organize your finances.
There was once a time when we wouldn’t have agreed to that last statement, let alone made it. But we have now seen the light (after a long, long time in the darkness).
There was chaos in many areas of our financial lives – that’s no secret. What always sticks in my mind is the pile of mail on our counter. It grew and grew and grew.
We always knew there were important things in this stack that we needed to pay attention to, respond to, and do. It was a mess that would make Marie Kondo sad.
However, it wasn’t just the chaos that was causing the stress. Part of the reason this pile piled up was because we knew this mail vortex contained a jumble of information about our financial mess.
You see, we were not financially organized at all. We had late statements, invoices, overdue notices and fees. It felt like every post was just another reminder that we were doing everything wrong.
Who wants to be reminded of this several times a week? We didn’t, and the mail pile grew by a week.
Am I the only one who isn’t financially organized? NO
For a long time we thought it was just us. Everyone else in our lives seemed to have everything together, but it turned out that wasn’t true.
Prudential’s 2018 Financial Wellness Census shows that 50% of LGBTQ people do not have a single banking product – not a single one, including a checking or savings account. It’s impossible to organize your finances without using the tools to organize your money.
This lack of organization then becomes expensive. Check cashing services and payday loans are far more expensive than using a checking account at a bank. Emergencies are already expensive, and adding 15 to 22% interest on top of the original cost because you covered them with your credit card makes the emergency even worse.
The cycle continues and it becomes more and more difficult.
Then it’s much more difficult than it needs to be. Don’t make it harder than necessary.
Learn more about why LGBTQ people are unbanked and what we can do about it in this video we created in collaboration with Prudential.
Can I do everything necessary to organize myself financially? Yes
There are some basics that we can all use, like everyone else, to organize our finances. Below are nine.
1. Open and use two checking accounts and one savings account
Either online – the easiest option – or open two checking and savings accounts at your neighborhood bank. You can open these accounts online once you create your Instagram account and the benefits are even more rewarding.
You only get Bill Pay for a checking account. For your second checking account, you will receive check writing, Bill Pay and a debit card in your checking account.
Next, set up direct deposit from your employer into each of these three accounts. For your first checking account, the account that only has Bill Pay available, you directly deposit enough money into this account to cover all of your fixed costs each month. Fixed costs include rent or mortgage, car payments and WiFi. Then set up bill payment in this account to automatically pay these fixed costs each month.
Set up your direct deposit into your second checking account that has all the features to cover your fluctuating monthly expenses. This includes heat, water, food and social spending.
Finally, deposit excess money from your paycheck directly into your savings account and let it accumulate there. Over time, you will save more money than you think.
2. Send it before you spend it
One of the biggest challenges in organizing your finances is paying bills on time and in full every month. Failing to do this will hurt your credit score too!
Pay all your bills as soon as you receive your paycheck, even before your bills are due. You can even call your service providers (cable, phone, etc.) and have them reschedule your payment dates to fit your payment cycle.
David shares another tip for managing monthly expenses. . . Money chunking.
https://www.youtube.com/watch?v=TyKO3-ePTr
3. Use a budget
It’s simply impossible to organize your finances without a budget. A good budget that you will stick to will fit your lifestyle and needs. It shouldn’t feel like a diet. It should feel like a success.
Should a budget feel like a success? YES!
At least once a month, you should be able to take a look at your accounts, the checking and savings accounts mentioned above, as well as your emergency savings and investment accounts, and feel like you’re making progress. It should I feel like all the work is worth it.
For this reason Finding the right budget is so important.
Learn more about our easy-to-understand, step-by-step budget you can start using today.
The Budget Buster Bundle Queer money®:
4. Use cash and the envelope system
Cash is still king and nothing beats the envelope system. We strongly believe that today’s modern conveniences make it more difficult to manage money. We have never been as far away from a transaction as we are today.
Don’t you believe us? Try it. Next time you go shopping, pay for one transaction with cash and another with a card or phone, and tell us you don’t have different, instinctive feelings about the two.
Paying with cash creates a different consciousness, which is one reason cash is king. To make handling cash easier, use the envelope system to keep your cash organized. We still use the envelope system for our gas, food and social expenses.
For example, our social spending might mean a $1.50 fee here, a $25 fee there, and a $15.81 fee there. Balancing our checking account after a series of such expenses is a nightmare, and we usually make a mistake somewhere.
This lack of financial organization usually causes us to stop using our credit cards, and that is exactly what we are against.
5. Use financial software
No fancy Excel spreadsheet can beat the modern apps.
It is a good tool for personal budgeting. For our business, we started using QuickBooks and like it.
While we use financial software to assist in our daily budgeting, our Excel spreadsheet is always close to our hearts as most financial software programs are not as detailed as we prefer.
Hear Sam Schultz, co-founder of Honeyfi, talk about it Queer money® Podcast about why gay couples who talk about their money together have better sex lives.
Honeyfi’s Sam Schultz talks sex and money Queer money®:
6. Go paperless
Manage your invoices, don’t let them manage you. This has never been as easy as it is today. When you set up Bill Pay on both of your checking accounts, you’ll likely be asked if you want to receive future bills electronically. Your answer is “Yes!”
Set up a unique email address for your invoices. If you then set up Bill Pay and choose to receive future bills electronically, those electronic bills will be sent to your specific email address. In this email account, create folders for each of your invoices, such as: E.g. “heating”, “mortgage”, “student loans”, etc.
For the few bills you cannot set up to receive electronically, file them in the same location in your home as soon as you receive them and double check your next bill payment will be sent to you on time and in full.
Go paperless with your checking, savings and investment accounts too. These can be saved in separate folders in your new email account.
Putting all your documents in an email folder isn’t necessarily the best way to organize your finances. Some documents such as trust and estate documents, wills, etc. are better archived electronically using financial tools such as DocuBank and LifeLink.
These tools electronically store official and legal documents, including health orders, emergency medical information and marriage certificates, making them easily accessible when needed from anywhere in the world.
7. Conduct a regular check
Once you’re done setting up this system, it seems like you can just forget everything.
Incorrect.
It’s still important to make sure everything is working properly. Make sure your Bill Pay amounts adequately cover all of your bills. Make sure everything is sent out on time – that’s why it’s helpful to send it out before it’s issued.
You should also double-check that you are receiving the payment and that your direct deposits are being properly allocated to each of your accounts, your two checking accounts and a savings account.
8. Request and review your credit reports
An important financial concern for LGBTQ people – and a good barometer for your financial organization – is your credit report. Once a year, visit FreeCreditReport.com and request three free copies of your credit report.
You should receive your credit reports from Experian, Equifax, and TransUnion in a few days. Once you receive them, check them carefully for accuracy. If you notice errors or outdated information in your report, contact the report creator directly to update their records. Then ask them to send you an updated report for your records.
If you need help improving your credit score, sign up for our free ‘Build or improve your credit score with Experian Boost.’ It could improve your credit score by 5 to 50 points in 15 minutes or less.
Learn about the three main reasons for a low credit score in this video with David.
9. Clean and save
Most of us have stacks or drawers full of paper because we don’t know what to keep and what to throw away. Create a process for cleaning and saving regularly, and you’ll never be more organized with your finances.
Keep all invoices or bank statements that you cannot process paperlessly in a folder for a year. They should then be destroyed. If you still need these documents after they have been destroyed, you can obtain them from the issuer at any time.
Forms such as tax returns, insurance policies, deeds, trust and estate documents should be archived. Tax returns should be retained for at least seven years. The easiest way is to save all tax forms for the same year in a folder marked for that year.
Yes, at some point every adult needs a small file drawer or cabinet.
Here are some of your rewards for organizing your finances: