Time for a Quick Clean Up
Posted by Gail | Filed under Budgets, Money Management
When I got up this morning, the sun was already peaking back at me. Yeah, Spring! I’m heading off on vacation but India is going to put up my next 7 blogs so y’all don’t have to worry.
With Spring just around the corner, it’s time to get things tidied up. I’m ruthless about getting rid of stuff I am no longer using or that I no longer love around me. I started this when the kids were young and I had to make room for the piles of stuff they’d have to incorporate from the massive deal we made of Christmas. But I find it’s very useful to review what we have, what we need, and what we want so I clean up a couple of times a year now — Spring and Fall — and get refocused.
The same tactic is a good idea when it comes to your money. If you’ve slipped off your budget a little or a lot, now’s the time to right your boat so you can stay afloat through the rest of the year. Maybe you tapped into your emergency fund, fully intending to replenish the pool. It just didn’t happen and your depleted emergency account feels like a slap every time you look at it, so you don’t. Hey that’s not going to solve the problem.
When was the last time you reconciled your bank statement? Have you looked at your insurance recently to see what you’ve got and what you may need to change? How about that investment portfolio? Still chugging along in the direction you like?
While it’s easy to get caught up in the everyday parts of life, sometimes we forget to stop and take a look at the big picture. But it’s the big picture that helps guide us through whatever comes next, and if the picture is a little (or a lot) fuzzy, it’s easy to lose sight of what we’re trying to achieve and go off the rails.
Have you been tracking your spending? If you’re behind entering your numbers, time to get busy. If you’re on the money, time to look at those numbers to see what they say about how your budget has been working for you. Maybe you didn’t set aside enough for the kids’ sports programs and consistently went over budget. Hey, you had the money, but this category seemed to be out of hand. So, will you cut back, or will you acknowledge that you need to spend more and adjust your budget (cutting back elsewhere if necessary) to reflect your reality?
Some people leave off actively planning, setting goals, and tracking when the caca hits the fan and they’re so restricted in what they have to spend that they feel like there’s no money to manage. While things are tight right now, this is the best time to learn about watching the pennies (physically and on paper) so that as things get better and the purse strings loosen up, you don’t end up going overboard. Even if you feel your financial case is hopeless, don’t hide. Push through the panic and take control of what you do have.
If you’re one of those people who holds on to every single piece of paper that passes through your home, time to have a shredding party. Get rid of everything you don’t have to keep.
Keep your tax returns and backup docs for 7 years.
Keep your insurance policies only for as long as each policy is in effect. Dump old policy paperwork if you get a new documentation with your renewal each year.
Review your warranty file and get rid of booklets for anything that’s gone the way of the recycling bin or for which the warranty has expired. Ditto home-repair warranties.
Keep you last two year’s worth of pay stubs and dump the rest.
Keep a year’s worth of bank statements in an accessible place so you can re-vamp your budget from accurate figures and file everything else for five years, particularly if you don’t track monthly on a spread sheet.
Keep the current year’s credit card statements on hand for revamping your budget.
Dump your ATM receipts once you’ve reconciled your bank statement at the end of each month. (Hey, time to get reconciling so you can dump that load of paper you’ve been holding on to.)
If you have stocks, bonds, or mutual funds, keep the statements and dump all the marketing material.
If you’re writing off your utility bills for tax purposes, keep them in your tax file. Otherwise, keep one year’s worth for comparative purposes.
And as for your mortgage documents, keep ‘em until you die, or the mortgage is paid off, whichever comes first.
March 10, 2010 at 8:04 am
Very good reminders. The only way I get to the ‘clearing’ stage is to book it in my calendar – otherwise it just doesn’t cross my mind.
March 10, 2010 at 8:07 am
I am a Pack Rat (border-line hoarder) so this is great advice. I’m always scared I’ll throw out paperwork that I’ll need in the future. I will try to encorporate this advice into my Spring Cleaning next week!
March 10, 2010 at 8:44 am
I have a lot of cleaning to do. I’m hoping that as the snow melts I’ll get closer and closer to getting rid of stuff we no longer need.
regards,
Jason
March 10, 2010 at 8:57 am
Thanks for the spring clean up reminder, Gail. With this gorgeous weather, I’ve been spending time outside – but with rain in the forecast, it will be a good time to purge my files. Have a fantastic vacation! Enjoy!
March 10, 2010 at 9:29 am
I start my spring cleaning when I get ready to file my taxes – that way I know what I have on hand, what I’m waiting for, and what I don’t need anymore. And from there it spreads to the rest of my house. So I’m looking forward to having a weekend of knowing that my taxes are filed (doing it tonight – very excited!), that I’m cleaning the house, and removing any and all unnecessary items from my house, giving me, my husband, and our three kids more time together.
Enjoy your vacation!
March 10, 2010 at 9:47 am
Thanks for the advice — I love decluttering, except when it comes to paperwork –I get completely overwhelmed. Great tips!
March 10, 2010 at 10:04 am
I always do my clean up at tax time. It is also an excellent time to run a credit report on yourself. It keeps you aware of how you are doing and allows you to check for identity fraud.
March 10, 2010 at 10:06 am
We just went through our files…my friends have kept every credit card statement for the last 5 years. He thought he had to keep those for tax purposes! I went back, sifted through it all and kept only the last year. We’ve brought a shredder home from work and we’re going to shred it all on the weekend. We’re also moving quite soon, so we have to do a lot more decluttering.
Have a great vacation, Gail!
March 10, 2010 at 10:08 am
I have been watching that hoarder show alot since it came on A&E, and I think that’s honestly a big part of why I took a look at my money and began budgeting better.
I decided that I would spend minimum 15 mins a day (although I could do 1 hour in 4 days) to “organize/clean” my life. And within 3 weeks of doing that, I bought Gail’s book, did 6 months of paperwork to get a financial snapshot, and snowballing in a good way since.
And making progress in other areas of my life… looking forward to more spring cleaning!
@lauren – you know you are well on the road to financial success when you look forward to doing your taxes! LOL
March 10, 2010 at 10:14 am
It must be an unwritten custom to shred at tax season! lol!
I was just getting ready to make my ‘to-do’ list for the weekend. Getting my tax papers all together, filing and shredding are a must.
I like to have the house in order before the yard work begins.
Safe travels Gail! I hope you have a fun & relaxing time wherever you may roam.
March 10, 2010 at 10:38 am
I’m a girl that loves a de-cluttered house. Unfortunately, I live with a pack of hoarders! I want to do a clean sweep and de-clutter each room, but I need the co-operation of my hubby in particular because most of the stuff I want to get outta here is HIS stuff! And I can’t even think about my 10 yr old son’s room without having a seizure! It’s not messy – it’s just cluttered, and that drives me insane!
March 10, 2010 at 10:40 am
These are some great suggestions. I have years worth of car insurance policies that I need to toss. I did wonder about the pay stub thing though. Don’t you need to keep those for 7 years or something like that in case you get audited?
March 10, 2010 at 10:50 am
There is certainly something about spring that makes you want to declutter. The garage is where I have to start, and I’ve given myself two weekends to do it. This is to get ready to have a garage sale when the weather is nicer. I have had my spring to-do list up since Jan. 1st (hehehe, now that’s planning! lol)
Have a great vacation, Gail.
March 10, 2010 at 11:05 am
Thanks for the great tips Gail! Tax time is the perfect time to go through all our paperwork, get caught up, and organized. I tend to hang onto a bunch of unnecessary papers as well. Spring cleaning time!
Enjoy that vaca!!!
March 10, 2010 at 11:17 am
Lauren, I did my taxes two weeks ago (but I also knew I was getting money back! If I had to pay money, I would probably be delaying the submission!)
March 10, 2010 at 11:23 am
Thank you Gail,
I have to do the cleanup and I was wondering what should I keep !
It will be very helfull!
Christine
March 10, 2010 at 11:33 am
I also did my taxes 2 weeks ago knowing that there would be a refund because of the home reno credit, plus in all my working years I have never owed.
March 10, 2010 at 11:40 am
I’m looking forward to de-cluttering not only my house and files, but also my email inbox! It is a total disaster right now!
March 10, 2010 at 12:39 pm
Excellent tips, thank you.
March 10, 2010 at 1:13 pm
I am one of those people who are able to pay/file/shred in one fell swoop when the mail comes in. So, with our finances in order for the year, and not being pregnant this spring, I will be cleaning the house. My #1 goal for this year is to use the things I have, like the tube of face mask I’ve had for years because I’m saving it for a special occasion. I’m getting older! Reason enough!
March 10, 2010 at 1:37 pm
Slightly off the topic of finances; I once borrowed a book from the library called something like “Uncluttering your life for Dummies” or “Organize your life for Dummies” and it was terrific – simple and straightforward.
We had a borderline hoarding situation because we were broke students for a long time and did not like to give anything up. One of the hard parts about decluttering is letting go of things – and I found that one way to make it easier was instead of tossing stuff in the dumpster, if we could give them to the Salvation Army or Big Brothers and Sisters, then it felt like we were being generous. This book helped us make various piles: to keep (and use), to fix, to throw away, to give away, to recycle. Big turning point in my life.
As a side note, the book suggested doing these things in marathon sessions, rather than 1/2 hour per day if you can manage it. This is because as you get tired of organizing, you tend to throw more things in the trash/give away piles (which is what you want). This works for me, but obviously not everyone.
Now that I think about it, it’s time to go through this exercise again as junk has been building up …
March 10, 2010 at 1:38 pm
And this book also had a section on organizing/decluttering your finances.
March 10, 2010 at 1:47 pm
RE: insurance documents. I’d recommend holding on to them for four years.(industry standard) The reasoning behind this is that claims can be brought against you after the term has expired, but the policy in effect at the time of loss would be the one that pays out. Your policy is your proof of coverage. (Particularily for car insurance policies where injury claims can take years to close.) Its also helps if you are writing off part of your home/car insurance costs as business expenses.
March 10, 2010 at 2:21 pm
I look forward to spring cleaning every year! Does this make me weird?
March 10, 2010 at 2:35 pm
@Manisha – There is actually a 2 year statute of limitations to start a claim on a car accident. If it’s an on-going case however I would keep all records from the time of the accident
March 10, 2010 at 2:53 pm
As always, great tips Gail!
Enjoy your March Break with Alex and Malcolm.
Safe travel!
March 10, 2010 at 2:57 pm
Some great blogs on the topic of simplifying and minimalism are zen habits and mnmlist. Both are by Leo
Gail has mentioned them on this site before and when I checked them out I found them very inspiring.
I got rid of piles and piles of stuff that I never use over the last couple months, and I feel great for doing it!
March 10, 2010 at 3:13 pm
I declutter at tax time too – shred old documents, rebalance my stock portfolio, redo my yearly budget. So far I’m on track and doing well, thanks to Gail’s regular encouragement.
Have a great vacation!
March 10, 2010 at 3:14 pm
I guess financially I’m ahead of the game because when I started on the Gail Program I went through all my files and shredded tons! Plus I do my taxes as soon as I get my T4 slip because I want to earn the interest on my return rather than let the government do so…
On the home front my daughter and I have a great understanding. A couple times a year she goes through everything in her room and toybox and makes 3 piles: keep, toss and give away. She really gets into it and usually ends up with about 1/2 of the stuff she started out with. We then make a trip to VV Boutique (Value Village) and she helps me unload it all. We then go inside and she gets to choose 1 toy to take home as a reward
March 10, 2010 at 10:25 pm
Decluttering is very cleansing…of your home and your mind. Decluttering finances is even better! Shred even those ATM receipts!
March 11, 2010 at 11:07 am
I have kept the last paystub of each year since I started working. It is fun to look through the years & see how my starting wage of $2.50 per hour has increased over 35 years of working
March 11, 2010 at 12:53 pm
Hard to keep pay-stubs when they are online… and I don’t really want to use my ink and paper to print them out, the point being that this was supposed to save paper. I am going to assume that my T4’s are the things that I really need to save? I usually also print out my last paycheque of every year, to compare the cumulative numbers with the T4 — is that good enough?
March 11, 2010 at 1:56 pm
@Cas — I just talked with an accountant about paystubs because I never keep any. I make sure that my T4 is correct (it’s easy because I’m salary) and that’s it. She told me that there is no reason to keep a paystub, although financial institutions want to see your most recent stub if you are applying for credit. There is no reason for paystubs for tax reasons — if the T4 is accurate, it’s all you need.
For knowing what you’re netting — might help when you’re budgeting.
March 11, 2010 at 7:45 pm
@Kat: Thanks. That’s the way I was thinking, it’s nice to get that confirmed.
Definitely got to get moving on that paperwork though. I have a lot of old insurance documents, bills, etc. that I have to get rid of.
@ Janet: I found my old pay-stubs from K-Mart… it really is amazing to see where my salary is at now, and think that if I had foreseen my future paycheques at that point, that I would have thought that I was going to be rich! SO not! LOL!
FYI: for those of you shredding documents all at once, careful it doesn’t overheat
Mine always shuts down for awhile because I save up too much to do at one time 
March 12, 2010 at 1:23 pm
I was all motivated by this blog to start my spring cleaning, took this afternoon (Friday) off to get started and it dumped a couple inches of snow on us and covered up all of the budding trees and blooming crocus! (This is Victoria, not a regular occurrence). I am not feeling all that motivated anymore. Sigh. Maybe I’ll just do my taxes to get started.