HOW TO ORGANIZE YOUR FINANCE

A wised man once said: ” It is not about how much you make, but it is about how much you keep.” It is difficult to save your money if you don’t know where it is going. Being unorganized can cause more harms for your financial health in the long run. Here are a few tips to help you fix some bad habits and start organizing your finance immediately.

1) Track your expenses

Majority of us have only one full-time job and receive a bi-weekly paycheck, so it is not difficult to track incomes. It is, however, a little more challenging to know how much is your spending and what you spend on. Many get lost because either they are lazy or simply just don’t care. At the end of the month, it is common to see people scratching their brains wondering where is the money comes from.

To get your finance on track, it is essential to know the amount going towards mortgage, foods, bills (electricity, gas, sewage, phone, car insurance …), and personal hobbies. You can do it either daily, weekly, or even monthly. The more details you put into it, the better understanding you will have.. I used to write down every single purchase I make daily using my phones. But after doing for like a week, it gets boring, so I decided to create a spreadsheet of my monthly expenses.

If you don’t know where to start, my Free Resource Library have all the templates that can help you track your expenses. All you have to do is sign up.

2) Use financial softwares

Don’t be a fool like me and manually write down every single purchases. There are many apps out there that help tracking your expenses by simply syncing with your bank accounts. Mint, ClarityMoney and PersonalCapital are not only free to use but they are user friendly and very good at what it does. I highly recommend these three apps because I have been utilizing them for about two years now without any safety issues.

Related:

5 EASIEST WAYS TO TRACK YOUR BUDGET

HOW TO TRACK YOUR EXPENSES

3) Create a budget

Once you understand how much coming out of your account towards foods and bills, the next step is to set up your budget. The goal of a budget is to have some money left over and put it into your saving account or invest. If your monthly income is $4,000 but spends all of it, you will be lucky to be able to live off your social security check once retirement hits.

Related:

How Much Will I Get From Social Security If I Make $100,000? (Featured Post)

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4) Check on your bank account at least once a day

This is an important habit to develop. I am a visual learner so checking my bank account daily help me visualize how much money I have left in my checking or how much I have spent so far. Let’s say I already paid $15 at lunch, do I really want to eat out tonight or stay in and eat the food I have already meal-prepped for the week. Basically, this method allows me to be more conscious of my money.

5) Pay your bill right away

Don’t be lazy and put off your bills just because you are not near the computer. Paying your bill on time and right away will ensure no late payments and avoid over drafting.

6) Organize your bill by utilizing different credit cards

Imagine if all your expenses go on one credit card, it is difficult to know what goes towards the bills versus other costs. Swiping your credit card every time you go out to eat, shopping, and paying your statement, it could be overwhelming to look at your credit card at the end of the month. Currently, I have three credit cards:

• Wells Fargo: all my bills: gym, electrics, phones, car insurance. Basically anything that has recurrent payments.
• Chase Freedom: all other purchases such as foods, gas, candy, …
• Chase Sapphire: all business expenses.

I am just an organized freak so doing this allow me to estimate how much I need to put towards my bills and help me budgeting.

Take away points

If you are serious about your finances, I recommend following these steps. At the end of the day, you are the one in control. These steps require some disciplines but most importantly, patience.