Organize Your Finances in 3 Steps

Posted December 5th, 2014 by Alexis O'Connell

Everyone feels the pressure to get their finances in order, especially when increased spending kicks in during the holidays. But let’s face it: tackling good personal finance habits and seeking financial help is especially overwhelming when everything—from your bank statements, to your bills, to your financial focus—is in disarray. Before finding a financial advisor, setting your financial goals, or plotting your holiday gift budget, find some financial peace for best results.

Fast, Free Auto Insurance Quotes

EverQuote spoke with Karen Carr, a financial planner at Society of Grownups in Brookline, MA about the best strategies for improving financial feng shui. Here are three ways you can be your best financial planner.

Step 1: Accept That Your Finances Deserve Attention

We’ve said it before but we’ll say it again: everyone can benefit from having a financial plan.

“One of the biggest misconceptions I’ve seen is the idea that financial planning is only for the wealthy or people planning for retirement,” Carr shares. “If you’ve got a tight budget, financial planning is incredibly important.”

If you’ve clung to the notion that your finances don’t warrant serious planning, it’s time to let it go. Whether you’re on a strict savings diet or whether you’ve just received a significant raise, your finances are deserving of careful attention. “It enables you to prioritize your goals and stretch your money on the things that matter the most,” Carr explains.

Accept that your finances need special care, no matter what your financial situation. To help yourself rise to the occasion, Carr advises setting aside time each week to review your spending and account balances. “It’s a great way to stay on top of things and will only take a few minutes.”

Step 2: Talk to a Professional

Your role as keeper of your own finances still applies when you meet with financial professionals. And, yes, everyone can benefit from speaking with a financial expert about his or her financial plan.

Before you even start to search for the right financial pro, consider your own priorities and worries. “It’s your individual questions and concerns that shape meetings with a financial advisor,” Carr states, “so the first step in preparing for this meeting is putting some thought into what you would like to get out of it.”

You can help to ensure a productive meeting with a financial advisor by taking a few preparatory steps:

  • Reflect on your financial goals. What would you like your money to accomplish? Where do you want to be in five years? Creating a list of financial goals will help you establish your financial priorities.
  • Prepare any documents that are pertinent to the meeting. “Maybe you’ve just gotten a new job, which offers a wide array of benefits that you need help unwinding,” Carr suggests. “If you’re interested in how to get rid of your debt, you’ll want to bring documents like your credit card bills, your student loan statements, your car payments, etc.”
  • Avoid panicking if you don’t follow the above advice: starting and sticking to the financial planning process is more important than being perfectly prepared along the way. Take it from Carr, who says that her clients sometimes “bring no documentation at all, but are mainly there to have a conversation and get some help defining their financial goals in the first place.”

Step 3: Keep It Simple

“We have access to so many websites and apps that are supposed to help our financial woes,” Carr explains, “but I’ve found that these tend to complicate things even further.” People trying to organize their finances may find the sheer number of organization options at their disposal overwhelming.

“One thing I’ve learned from working with clients is that if something is complicated or feels like a data dump, they won’t use it!,” Carr says. Keeping it simple can make for a smoother transition to more conscious financial planning. Her spending app of choice, for instance, asks users to categorize their spending as fixed expenses, savings, or other purchase.

This straightforward approach focuses on the bigger financial picture without getting caught up in the details of every dollar. After all, Carr jokes, “Do you really care how much you spent at Starbucks last year?...After you pay your monthly bills and pay yourself, in the form of savings, the real question is: what’s left over? That’s the amount you can spend however you see fit, lattes or otherwise.”

Take these three steps—and remember to breathe—for decreased stress and increased empowerment as you organize your finances.