Get Your Act Together

By Jim Elder, Finance Editor

[January 2020 | San Juan Silver Stage | By Jim Elder, Finance Editor]

When I was a child, my mother used to say, “Get your act together,” if she wanted us to straighten up and clean the bathrooms and our bedrooms, then tidy up the house.

Now that we’re beginning to sober up from drinking too much eggnog during the holidays, it’s time to get our act together and tidy up our finances. Here are several steps you can take to get yourself on the right track.

• Organize Your Files. We’re not yet in a totally paperless world; there are some financial documents everyone should still keep on paper as printouts. Create a filing system that works for you, whether using a file box, a file cabinet, or even shoeboxes.

• Shred Unnecessary Files. As you organize your files, you will find outdated documents. If you have any unwanted documents with your personal identifiable information, then shred them. Your financial advisor can provide shredding service for you. (Alpine Bank also offers this service, for free, every spring at their various locations.)

• Digitize Your Files. Another great way to get rid of clutter is to convert paper files to digital. A person would do this with a scanner and computer and store the data on a disk, thumb drive, or on a cloud storage service. Your financial advisor should provide an online vault to store your digital documents. (It’s a good idea to also keep a thumb drive in your safe deposit box in case the Internet goes down right when you need to access something.)

• Automate Bill Payments. As we get older, some of us travel more and some of us tend to forget more. Missed bills are not good for your credit score. When you set up automatic payments, the bills won’t be forgotten and are always paid on time. You can automate car payments, mortgages, utility bills, and credit cards.

• Update Your Documents. A new year is a good time to make sure all your financial documents are still current. That includes updating beneficiaries on retirement accounts like IRAs and 401k Plans and transfer on death (TOD) and pay on death (POD) designations. It’s also a good time to review your will and medical power of attorneys (MPOA).

• Track Your Spending. It’s crucial to know where your money is going, and an organized tracking system will help. Software programs such as Quicken are a great solution, and online programs such as Mint, Personal Capital, or Tiller can assist in tracking your spending.

• Inventory Your Finances. Pull out all of your bank statements and investment reports, debts, deeds, and titles. On graph paper or a spreadsheet, list all of the assets together and then list all of your debts together. Subtract the debts from the assets and it will give you your net worth.

• Organize Online Accounts. We all have numerous online accounts with passwords, including bank and brokerage, credit cards, and even utilities. Keep a list of all of these, including the usernames and passwords. Keep it in a very safe place where no one but you can find or see it, like a lockbox or safety deposit box. And don’t carry a slip of paper with your passwords in your wallet! You can also use a secure online password vault such as LastPass or 1 Password.

Doing just a few of these suggestions will help you get on track to organize your financial life.