There’s been a huge shift in recent years towards people opting to simplify their lives – everything from their décor, to cutting back on technology, to their beauty routines. There are many benefits to committing to a simpler, more minimalistic life. Simplifying gives you the ability to declutter and escape the overwhelming stress caused by a busy life. However, this approach should extend beyond your home and into your finances as well. Finances are almost always a source of anxiety for people, and often an unpleasant thing to deal with. Here are a few ways you can simplify your finances so you can have more time to enjoy other things in life.
Automate Your Payments
Automating your payments can be a great way to simplify your finances and reduce the stress that comes with bills arriving at all different times of the month. You’ll avoid paying late fees and quiet those nagging deadlines in your head. And as an added bonus, your always-on-time payments will be great for your credit score!
Go Paperless
Simplify your life by digitizing your finances! Most banks, lenders, insurance, and utilities companies offer paperless billing these days. Reduce the amount of mail you get (and the likelihood that it will just pile up and be ignored) by opting to go paperless instead. You can usually set yourself up to get email reminders so you don’t miss anything and some companies will even offer a small discount or reduction in fees for choosing to go paperless. Just remember to still regularly check your bills and statements for any errors or discrepancies.
Keep Organized
Unfortunately, it’s impossible to go completely paperless. For when you have to do things the old fashioned way, it is important to declutter and stay as organized as possible! Buy yourself some attractive file folders and take an afternoon to go through all the paperwork you have piled up. Things you’ll want to make sure you keep are 7 years’ worth of tax returns (and supporting documentation), any contracts for active accounts, any bills in current dispute, home improvement records, old bills that have been paid (as long as not needed for tax purposes), and records for sale of an investment. Things you can purge include ATM receipts, bank statements more than a year old, credit card offers, and paystubs (after you’ve double checked your W-2 is correct and your taxes have been paid).
Consolidate Your Bank Accounts
If you’re someone who has several bank accounts at several institutions, it may be time to consider consolidating! Too many accounts to keep track of can make it difficult to see how much money is going in and how much is going out. This also goes for retirement accounts. If you have several 401(k) plans from past jobs, consider rolling them over. By reducing the amount of accounts you need to manage, you’ll make it easier to keep track of your assets and investments.
Reduce Your Amount of Credit Cards
Go through your wallet and assess which credit cards you don’t need. Nobody needs 8 different cards! Instead, pick 2-3 and close the rest. Choose ones you use regularly, have reasonable interest rates and annual fees, and that offer cashback or rewards points. Keep in mind this may temporarily lower your credit score, but you’ll benefit from having less bills to worry about and be able to better manage your spending habits.
Pay Cash More Often
Paying with cash rather than credit cards can help prevent you from entering a state of shock when your monthly credit card statements come in. This is particularly true if you regularly use more than one credit card, which can easily lead to you spending more than you can afford and then scrambling to juggle paying them off.
Cut Down on Your Subscriptions
The less subscriptions and memberships you have, the less bills you have to worry about paying. Take some time to assess which services are essential and cut out the rest. For example, you don’t need subscriptions to Netflix, Amazon, and Hulu! These extra payments just add unnecessary stress to your financial life (and eat up your budget)!
Become Debt Free!
Debt doesn’t just mean more money, it means more headaches and time spent paying bills as well. Making a plan to reduce your amount of debt can go a long way when it comes to simplifying your financial life. Of course, it won’t happen right away, but making a plan now to pay off your debts will simplify your financial future.
By taking a little extra time to simplify your finances, you’ll save yourself a lot of time and angst in the future. You’d be surprised at the difference simplifying your finances can make when it comes to your financial mindset and how much easier it makes achieving your goals! These steps are easy ways to take the burden out of managing your finances so you have more time (and money) in life for the things you really enjoy.
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