Spring-Cleaning Your Finances? Start With These 3 Things


Spring is in the air! Well, almost, anyway.

For some people, that means itchy, watery eyes and allergies galore. For others, it means a celebration of milder weather and the chance to spend more time outdoors.

For you, it might mean getting into serious cleaning mode. But in that regard, you don’t just want to focus on your basement, shed, and garage. Now’s a really good time to spring clean your personal finances as well. Here’s how to get started.

1. Assess your emergency fund

Do you have enough money in your savings account to cover three months of essential living expenses? If you don’t, you’re in good company.

Recent data from SecureSave found that 63% of Americans do not have the cash reserves to cover a $500 expense that arises out of the blue. But if your emergency fund is lacking, it means you’re running the risk of landing in serious debt the next time an unexpected bill lands in your lap, like a home or car repair. Or, it could mean having to live off of credit cards in the event of a layoff.

To avoid that scenario, sit down and figure out what your essential monthly bills look like. Then, multiply that total by three and see how far away you are from that target. From there, you can make a plan to boost your savings, whether it’s picking up a side job or cutting back on some of the things you currently spend on.

2. Set bills to autopay to avoid being late

Paying bills late could have different consequences. In some cases, it could mean getting hit with fees. In other cases, it could mean credit score damage.

It pays to see which bills of yours are eligible for autopay. That basically takes human error out of the equation, and it also might free up a lot of time in your schedule so you can focus on other important matters.

Some of the bills you can think about automating may include your:

  • Mortgage
  • Car payments
  • Cellphone
  • Cable
  • Utility bills (you can work with your providers to get onto a payment plan that works for you)
  • Estimated quarterly tax payments, which you have to pay if you’re self-employed or earn freelance income during the year

3. Come up with a filing system that works year-round

If you’ve been spending the past few weeks digging up documents for your taxes, then you may have found yourself bemoaning your lack of organization. But the reality is that it’s important to keep good financial records year-round, and to have a system for filing documents you might need in the near term as well as the long term.

During your spring cleaning, come up with a filing system that’s sustainable for you. That could mean scanning documents and storing them electronically, or buying cabinets to house physical files. And before you start moaning about how time-consuming this task might be, recognize that making the effort now could save you a lot of time down the road.

The start of spring can be a mixed bag, depending on whether you’re a fan of the season or not. But one thing’s for sure — it’s important to get your financial house in order, and now’s as good a time to do that as any.

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