Learn and Plan | Ways to organize your personal finances
A man reviews his personal financial files while creating an organization system.

Ways to organize your personal finances

Oct 4, 2023, 2:30:50 PM | Reading Time: 5 minutes

Keeping your finances organized is a good idea to help successful money management and helps you keep track of your expenses, spending habits, and monthly bills. The more you understand where your money is going and how your income is spent, the easier it can be to keep your financial goals on track and be better prepared for emergencies or unexpected expenses.

Here are some steps to getting your finances in order.

List your accountsList your accounts

An excellent place to start organizing your finances is to gain a big-picture view of your money. Start by listing out your accounts that have financial value, such as your:

  • Checking account
  • Savings account
  • Certificates of deposit
  • Credit cards
  • Debt
  • Auto loan
  • Mortgage
  • Personal loans
  • Student loans
  • Investments
  • Brokerage
  • Retirement account
  • Life insurance
  • 401k or 403b
  • IRAs

Once your accounts are listed, you can organize them by creating a spreadsheet. Specific software can also help you see your financial life all in one place by keeping track of your accounts and automatically updating them. You may be able to generate reports that can help you monitor your money and identify overspending or income gaps quickly. By taking inventory of all your accounts, you can build your budget accordingly and stay organized as reports are added or removed down the road.

Reassess your budget once a monthReassess your budget once a month

To stay on top of your income and spending, you’ll want to review your monthly budget. You may need to make adjustments along the way as your financial situation changes. You can also reduce your fixed expenses, such as your mortgage, rent, and insurance rates, or try to cut down your variable expenses, like your grocery bill, utilities, and transportation costs.

Use budgeting appsUse budgeting apps

Several budgeting apps make it easier to see how much you’re spending, track your cash flow, and pinpoint savings opportunities. If you need help getting your finances under control, there are various personal finance tools to choose from. Many applications are designed for general personal budgeting. Still, each app may offer specific features, such as tracking your bills, a complete money management system, or alerts when you are close to overspending or reaching a financial goal.

Store important documents in a secure placeStore important documents in a secure place

You likely receive your bills in various ways, whether online, by mail, or a combination of both. Keeping these documents organized for easy access is essential to getting your finances in order. For electronic bills and account information, create folders on your computer and in your email to sort each according to the type of bill or organization. If you monitor your accounts online, creating an Excel spreadsheet with account information, passwords, and other details can be helpful. Remember to keep your computer protected with a password or code to prevent anyone from accessing your information.

You’ll also need a place to keep investment papers, significant purchases, bank documents, tax files, and estate planning documents such as wills, trusts, living wills, medical directives, and powers of attorney. Creating a system for storing and organizing important financial statements and documents may take a little time at first, but managing your paperwork is worth the effort so you can protect it and easily access it whenever you need it.

File receipts for important purchasesFile receipts for important purchases

Receipts for major purchases should be saved and stapled to the warranty or instruction manual and then stored in a permanent file. A classification folder with pocket dividers for each type of purchase (electronics, furniture, appliances, etc.) is a good idea for keeping them organized.

 Store important documents in a secure placeOrganize your investment papers

Keep any monthly financial statements until you get an annual summary. When you receive the annual summary statement, shred the monthlies and file the summary. If you have a bunch of accounts, make sure to set up one folder per account. Keep any paperwork associated with the accounts as long as you have those investments.

Store estate planning documentsStore estate planning documents

You want to store estate planning documents in a safe and accessible place. Most people think of safe deposit boxes first but remember that many states require a court order for your family members to open the box and locate your documents if they are only under your name. You can keep your estate planning documents at your attorney’s office or in your home or office; just make sure to store them in a fire and waterproof safe.

Safeguard electronic documentsSafeguard electronic documents

With the rise of computer viruses and ransomware, you must ensure your electronic financial documents are secure against the latest cybersecurity threats.

Back up your digital documentsBack up your digital documents

Emailing copies of your documents can put you at risk, so instead, back up digital docs on an external hard drive and password-protect the files. Be sure to update that storage periodically. For certain documents, you may also want to make a copy to a second drive and store it in a safe deposit box.

Secure data on your mobile devicesSecure data on your mobile devices

If you have sensitive data on your computer, tablet, or smartphone, you need to be careful when you’re in public. Public Wi-Fi usually doesn’t offer encryption for individuals using the same hotspot, so your signals can be broadcast across the immediate area. This makes it easy for someone to eavesdrop on your communication or for hackers to intercept your signal. The best way to secure sensitive data is to not keep it on your mobile device.

Save passwords securelySave passwords securely

Storing passwords is a risk, but it’s something to consider to ensure you have access to your accounts and your loved ones can access them when you pass away. You can use special password organizer books or a password manager program that generates and maintains strong passwords. Also, remember to update these passwords regularly and do not use the same one for multiple accounts.

Communicate about accountsCommunicate about accounts

If you share accounts with a significant other, be sure to keep each other in the loop about spending, investments, important paperwork and passwords, and other important financial documents. It’s important you and your partner can access accounts and know where documents are filed, especially in the event of death or incapacity. By having open conversations about your finances, you can determine if you’re on target toward reaching your goals, have adequate savings for the future, and can correct any financial issues before they become a more serious problem.

When you have a good system that allows you to organize and maintain your finances, you help boost your financial well-being and give yourself the tools to make good money decisions. Even if you start with baby steps, the sooner you tidy up your personal finances, the sooner you can make informed and confident financial decisions.