Get Organized By Friday
I've recently teamed up with Office Depot to conduct a survey of 1,000 workers to find out how well they manage to stay organized throughout the year. While 93% said they feel being organized improves performance (like locating important documents, filing taxes and paying bills on time), 81% admitted to keeping a disorganized workspace. Oops.
With January being "Get Organized Month" and "February being "Time Management Month" now's the perfect time to get your financial house and home office in order. Here are my five tips – one for each day – for a fast recovery to better organization.
MONDAY: TAKE SELF-INVENTORY
Before getting physically organized, take inventory of your personal priorities and goals. Now's the time to get reacquainted with your goals and priorities. Think about where you want to be in the next year personally professionally and financially. Do you want to buy a house in the new year? Do you want to go back to school in 2011? Do you want to get married? All of these goals carry price tags. And the sooner you take inventory of these goals and commit to sticking to them, your money becomes less abstract and motivation kicks in.
TUESDAY: ASSESS THE MESS
Now you need to roll up your sleeves a bit and tackle your financials. Come face to face with the reality at hand. Three focus areas:
Credit card bills. Be honest. Count up every penny.
Savings. See how much is left in savings.
Credit. Take a look at your credit report and request a free credit score at sites like credit.com and quizzle.com
WEDNESDAY: DIVIDE AND CONQUER
From year-end statements to tax-related paperwork and receipts, some things need to stay and others can get the boot.
What to keep: Set aside all paperwork for your bills that you need to address in January from your credit card statements to your utility bills. Put these in separate file folders with labels or an accordion folder. (To attack your credit card bills — be most aggressive with the card with highest interest rate and work your way down. Keep in mind you always want to pay more than the minimum – an extra $10 dollars a month can get you out of debt months or years faster. Not to mention, it saves you tons in interest).
Gather up all related receipts and paperwork that you will need once you file taxes on April 18, including receipts for charitable contributions, out-of-pocket medical expenses and business or work-related expenses. I like to put these in a labeled box.
Things you can toss: We get more mail in December than probably any other month – all those holiday catalogues, the marketing material, the credit card solicitations. You want pull out the shredder to get rid of all those holiday mailings with your address labels and any piece of paper with personal information.
Rules of thumb: When in doubt, keep the new, throw out with the old. If you have a new version of an insurance policy, you can toss the old one out. Just make sure it hits the shredder first. Keep tax filings for a minimum of 3 years because the IRS tends to audit within that time frame.
THURSDAY: SCHEDULE IT!
One of the best ways to stay organized is to automate as many of your financial responsibilities as possible so that you never fall behind. For example, electronically link your checking account to your mortgage collector, the town treasurer (who collects taxes), the heating company, and your healthcare provider. You never have to be unsure about when to pay bills because they'll be automatically addressed each month. As for savings, decide on a percentage of your income to be automatically deposited into a savings account bearing the highest interest rate you can find. Ideally, I'd recommend 10 for a rainy day and another 10% for retirement.
FRIDAY: STAY ORGANIZED ALL YEAR
Now that you have your priorities straight and receipts ready for the upcoming tax season, remember to stay organized all year. Clear off your desk, prepare files for the coming year, get a receipt scanner so you don't have to fight with that shoebox full of paper, put your incoming bills in one place, paid bills in another, etc.
