How to Get Your Finances in Order During Spring Cleaning

Saving money on get finances order during does not have to be complicated. We rounded up the essentials so you can spend less and skip the guesswork.

Key Takeaways

• Spring cleaning isn’t just for closets; your wallet could use some freshening up, too.
• Here's how to do it.
• The birds are chirping, the flowers are blooming, and the weather is warming.

Spring cleaning isn’t just for closets; your wallet could use some freshening up, too. Here's how to do it.

The birds are chirping, the flowers are blooming, and the weather is warming. Spring is in the air.  And for numerous of us, so is the urge to deep clean our homes, garages, cars , pretty much everything in our lives.

However, one critical aspect is frequently overlooked in the spring-cleaning frenzy: our personal finances.

Unlike cluttered closets and dusty furnishings, finances are not something you see every day. You probably don’t spend a lot of time talking about money, either, so it’s simple to forget about it until your credit card bill comes.

Just like with your house, however, getting your finances in order will give you peace of mind and make the year ahead much smoother.

How to Clean Up Your Finances

To spring clean your finances, set up a time that works for both you and your partner, preferably with as few distractions as possible (like kiddos running around or your latest TV binge playing in the background). Be sure to come to your cleaning session prepared , not with dusters and a vacuum, but with the last few months of transactions on your credit cards and bank accounts; recent copies of debt (including the interest rate and current balance); a list of regular expenses; and login credentials for retirement accounts, bank accounts, brokerage accounts, etc.

Once you’ve gathered all the tools to clean up your finances, here’s what you should focus on:

1. Create a net worth statement

A net worth statement is essentially a snapshot of your finances, focusing on what you own and what you owe. It’s a excellent starting point because it can help you be more mindful of your spending, track your progress toward your goals, plan for big purchases, and so much more. Even if you’re in good standing, it’s key to have this view into your finances, especially over time.

2. Check your goals

Any type of saving and financial planning starts with goal setting. Without something to reach for, you’ll probably spend more money than you intend to , something we’re all guilty of. Decide what’s most key to you in the short, mid, and long term , then write those goals down. Each spring, you can review them to see whether you’re on track. Here are some common goals and questions to ask yourself when reviewing them:

• Reducing debt: Could you benefit from consolidating any credit card debt and/or renegotiating the rates? Does it make sense to refinance your home?
• Building an emergency fund: Do you have at least three to six months of living expenses on hand? Pro tip: Consider keeping your emergency fund in an online high-yield savings account. They typically pay higher interest than brick-and-mortar banks. Some offer incredibly lucrative bonuses for new shoppers (like this one, which could net you $400 in free money). 
• Planning for retirement: Are you maxing out your 401(k)s and/or IRAs? Do you have an old 401(k) from a previous job that you can roll over into an IRA or transfer to your new 401(k), if you’re able? Oh, and if you don’t have an IRA, now is the time to open one. 
• Saving for kids’ education: Are you contributing to a 529 education account? Can you increase your contributions? Do you need to reduce your contributions to avoid overfunding the account?

3. Go over your budget

Depending on your goals and expenses, your budget may fluctuate throughout the year, which is why it’s smart to review it at least annually. Pull the last three to six months of credit card and bank statements; determine whether you can cut any expenses (like unused subscriptions) and whether they line up with your financial goals.

You can make budgeting easier with apps like Rocket Money, which can help give you spending summaries for various categories. For example, you can quickly see how much you spent on groceries in a given month and adjust accordingly.

4. Review key financial info

You probably have a ton of financial documents floating around. Spring cleaning is the perfect time to make sure they’re up to date and have all the correct information. Consider the following:

• Review the beneficiary designations on 401(k)s, brokerage accounts, life insurance policies, cars, and bank accounts. Additionally, ensure your wills, healthcare powers of attorney, durable powers of attorney, and trust documents are accessible.
• Check your credit score, which you can do for free with the main credit bureaus (e.g., Experian, Equifax, TransUnion) once a year. Are there any red flags?
• Review your property and casualty insurance plan. Have you made improvements to your home that would warrant additional coverage? Has your net worth grown enough to increase your excess liability coverage?

5. Assess your investments

You may not handle all your investments, but you still need to check them regularly , or ensure your financial advisor is on the same page as you. Most importantly, what is your overall asset allocation, particularly the allocation between stocks and bonds? Is it in line with your target? It might be time to rebalance. 

Reviewing your finances regularly (or just during spring cleaning) will keep your goals top of mind and give you peace of mind that things are moving in the right direction. And who knows, just like you might find a cute, unworn sweater when you clean out your closet, you could find some extra funds lying around, too!

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Final Thoughts

The bottom line: a little research on get finances order during goes a long way. Compare your options, watch for seasonal offers, and never pay full price when a better deal is one click away.

Originally published at savingswitch.com.