Spring Clean Your Finances
Are you ready to make your finances sparkle?
Here are six ways to spring clean your money matters:
Sweep out your budget
It’s time to shake the dust from your budget! Pare down your spending until your budget’s looking neat and trim.
Freshen up your W-4
If you received an especially large refund this year, you may want to adjust the amount you withhold. The IRS’s tax withholding estimator can be a useful tool to help you determine the perfect number.
Deep clean your accounts
Do a Marie Kondo on your finances and get rid of any accounts you no longer need. For instance, are there dormant accounts at a financial institution you no longer use, or a 401(k) from your old job? Consolidate it. A minimalist approach to your finances will make it easier to manage your accounts, give your savings a greater chance at growth and help you avoid fees for unused accounts.
Toss out your debt
If you’ve been stuck on the debt cycle, make this spring the season to break free.
First, trim your budget, designating any extra funds for your debts. Next, choose a popular debt-busting approach, such as the avalanche method, in which you pay off debts in order from highest-interest to lowest, or the snowball method, where you start with the smallest debt and then move up your list. Going forward, maximize payments to the first debt on your list, making sure not to neglect minimum payments on the other debts. Before you know it, that debt will be gone!
Dust off your saving habits
Get into the habit of maximizing your savings with a tangible financial goal. You can also make savings an itemized line in your budget so you have funds set aside for this purpose. Finally, automate your savings by setting up a monthly transfer from your checking account to your savings account.
Make your investments sparkle
It’s time for a spring cleaning for your investments! Check if your allocation strategy is still serving you well, whether you need to adjust your diversification, and if your retirement accounts are on track for your estimated retirement timeline.
Follow our tips to make your finances shine!
Your Turn: How are you spring cleaning your finances this season? Share your tips with us in the comments.