I truly believe that liberty for a woman comes from the ability to make financial decisions for her life.”
~Reema Bint Bandar Al Saud
My grandmother seemed to always have money. I can’t recall hearing stressful conversations about money. We traveled every summer usually to Puerto Rico or Florida. One year I spent the summer in Germany, so travel was the norm. I also got a new suitcase each year filled with new clothes. As much as I admired (still do) her cash-only philosophy and delayed gratification I needed more.
On a mission to approach finances with a fresh set of eyes, no guilt over past financial choices, and divorcing fear. Let’s clear the pathway by doing a little decluttering. Just like a cluttered closet, room, or car raises levels of stress finances can have the same effect. I know I’m not alone here!
Clutter Proof Your Finances
- Eliminate mail and open ASAP
Paper and mail is a breeding ground for clutter. I can remember years ago student loan envelopes triggering sweaty palms and tummy aches. Open your mail immediately and deal with it so it doesn’t deal with you.
2 Automate Bills
The only bill I have automated is my car note. Automation saves time and ensures our bills are paid in a timely fashion. Many people don’t automate because the reality is they don’t make enough to cover it all. Stealing from Peter to pay Paul was all I saw from my parents growing up. An alternative is online banking where you have more control over the amount with no surprises. I love online banking. Quick, easy, and paperless.
3. Save the trees and go paperless
Remember we are decluttering so going paperless is a step in the right direction. Most financial institutions and utility companies have a paperless option. The additional benefit is not having to deal with “envelope trauma,” and filing papers. If a company uses paper billing, scan the document for your records. Smartphones have a scanning feature and Amazon sells some as well. Get rid of the paper!
4. Take time to purge
I personally never know what to keep or what to get rid of. Scared years later I’ll need something and don’t have it. Author Kim McGrigg has some nuggets of wisdom, clutter in your life reduces your effectiveness. It gets in your way, impedes free movement, blocks progress and essentially keeps you from living your life at 100%. Financial clutter can block your progress toward a clear financial path, and the cost can be tremendous if it keeps you from paying bills on time. When you’re ready take a look at her comprehensive list of what to keep and what to toss.
Steps/Checklists Towards Triumph
1. Develop a financial plan
- Establish realistic financial goals
- Develop a budget
- Don’t forget Uncle Sam
- Build an emergency fund
- Manage debt; don’t let it manage you
- Get life insurance
- Plan for retirement
- Invest beyond what a job offers
- Create an estate plan; this is not just for the wealthy
2. Manage your debt
- Don’t run from your balances; know how much you owe
- Pay bills on time
- Create a calendar old school paper and pencil of digital to note due dates
- Strive to pay credit cards in full, but make at least minimum payment
- Prioritize your debt, decide what gets paid off first
- Include your emergency fund here as well
- Check credit reports pay off collections, leverage disputing charges where applicable
- If you’re overwhelmed get help
3. Create a cash reserve
- Start small something is better than nothing
- Add up your monthly expenses this is how much should be put in the cash reserve
- If you have a side hustle consider putting 5% in your cash reserve
- This is separate from a regular savings account, don’t touch this
- Practice impulse control, if you want something give yourself a few days before pulling the trigger
- Eliminate and reduce where you can
- Debt with the highest interest rates should be attacked first and extras can go in reserves as you build
4. Plan for retirement
- Never too early to envision what you what retirement to look like
- Evaluate all your assets; even if the list is small
- Assess your health, be proactive, and schedule preventative exams
- Social Security is important to determine when you can collect, track your points
- Relationships are important and interested groups are vital, even in retirement you need to pay to play i.e travel groups/mission work
- Begin forecasting expenses during retirement and draft a budget that is fluid and will change
- Proactively prepare for the unexpected and include your family
- Focus on your plan and ensure the appropriate insurances are in place
I’ve spent many years allowing my financial trauma and minimal financial literacy to keep me from many of the things I’ve shared. But, leaning into the fear, therapy, learning, and surrounding myself with financial experts has been a triumph. Financial triumph is waiting for you, too!
Dare 2 Be Well!