How to Organize Personal Finances in 20 Easy Steps and Strategies

· Do you tend to be late on payments every month because you do not have the money to pay when bills arrive?

· Do you have large debt due to credit card companies?

· Are you always filing your taxes last minutes and when you do, you cannot find receipts or forms?

· Are you always finding yourself in a situation where you cannot afford things you want in life, like a vacation, backyard remodeling, or a new car?

If you answered “yes” to any of these questions, keep reading; this article may help. 

The Problem

Being disorganized with finances can lead to:

· Unpaid bills

· Late fees and finance charges

· Not being able to make larger purchases in life and therefore suffering the consequences

· Overdrawn accounts with the bank

· Purchasing of unnecessary items

· Wasted time

· Wasted energy

· Unnecessary stress and unwanted pressure

· Lost productivity

There are people who lose gift cards and rebates that could save them money. Some experience out of control spending that gets out of hand. 

The biggest problem with being financial unorganized is it is not just one thing that is affected; one problem leads to another problem, then to another problem, and so on. Here is an illustration: 

One poor financial decision can lead to another, then another, then another…the multiplying effect becomes an avalanche that often cannot be stopped, leading to:

· Bankruptcies

· Failed marriages

· Homelessness

· Stress and anxiety

· Mental and physical pain

In fact, in a 2016 study conducted by Psychology Science, it was found that higher levels of unemployment and financial troubles led to more over-the-counter pain killer drug purchases. Even worrying about financial problems lead to more emotional and physical health challenges. The U.S. National Library of Medicine – National Institute of Health also released a study in 2016 concluding that “financial stress demonstrates complex relations with inflammation” in the body. People could get rashes in their bodies, have increased blood pressure, trouble sleeping, over eating, under eating, which then lead to other health issues. Anxiety and stress can manifest in a variety of ways in the body, including panic attacks, profuse sweating, nausea, trembling, rapid heartbeat, and depression.

The Statistics

Financial instability and disorganization is affecting millions of people around the world. In the United States alone, financial fragility is high, especially among minorities. Here are some eye-opening figures and data:

· 27% of adults must borrow or sell something when they have an unexpected expense of $400. 

· 25% of adults have no retirement savings and skip necessary medical care.

· Over 51% of women report not having enough money saved for 3 months of living expenses.

Source: https://www.cnbc.com/2019/11/15/29-percent-of-americans-are-financially-healthy.html

According to Marketwatch.com:

• 44% of Americans say their expenses are more than their revenues and have to use a credit card to cover some of their monthly expenses
• 42% of Americans say they have no retirement savings at all.

Even though most adults are saying they are “coping financially,” they are not saying they are stable or well-off. They are getting by and making ends meet.

The Solution

It is difficult to sit and look at the financial situation at hand because ignorance can sometimes feel less stressful. Not facing the facts, though, will not solve the problem. In fact, it will create an avalanche effect where the problems will multiply and become unbearable at some point in the future. Having organized personal finances will help relieve stress and help you get on track to success. Organizing personal finances will help you:

· Make better decisions about investment choices

· Help save money

· Decrease debt

· Get out of debt

· Increase wealth

· Improve long-term planning

· Improved mental and emotional health outcomes

· Freedom to be generous

· Better marriages and relationships

· Save you time

It is also important to note if you have children living with you, the better decisions you make financially and more organized you are, the more they can learn from you and acquire the same spending and saving habits  You will be a role model for them!

Follow these 20 easy steps and strategies to become more financially organized starting today!

20 Steps and Strategies to Become More Financially Organized

1. Set a goal to eliminate your debt. Here are 3 examples:

· I will pay off $1,100 in credit card debt by end of November this year by paying a set amount each month.

· I will consolidate $6,000 in debt within 3 months so I can pay one set amount each month and reduce my interest fees.

· I will refinance my car by end of August with a credit union so I can lower the interest rate.

2. Write down all debt owed on sheets to carefully track each month, like a car loan, personal loan, and credit card balances. This is a stressful process in the beginning because it is difficult to face the debt that has accrued. As balances get paid using the forms, you will feel a sense of freedom, empowerment, and accomplishment. 

3.  If you have a good relationship with family members and have a small amount of debt that is incurring large interest penalties, ask for help. Often, parents and grandparents do not mind coming through with helping if the request is somewhat small and unburdening.

4. Do some research on credit scores. Find out your score from a local bank or credit union, then research ways to get the score higher.  Higher scores will lead to lower interest rates and more savings.

5.  Do not go to any store without having a list of exactly what needs to be purchased. This will help you save time walking around the aisles and save money by not buying things you do not need. A grocery list made each week, and a separate store list for all other essentials, is imperative to having financial organization. 

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About the Author

Ruzanna Hernandez is an educator, public school administrator, writer, blogger, and business owner. After being in a large credit card debt situation in her early twenties, she used her skills with organization to get her finances in track. She managed to get out of $21,000 in credit card debt, save for a car, and even save for a house. Her credit score improved and she managed to get a small business loan to start her first business in 2003, which is still profitable today. She credits this to finding efficiency and organization in her daily routines, which she writes about on her website efficiencyandorganization.com. She is a lifelong learner of health, wellness, personal finances, entrepreneurship, education, and living life well. Some of her strategies are shared in this article, along with other researched and proven tips, techniques, and strategies.