It’s easy to get inspired to pick up a dust mop, tuck away sweaters and snow boots, and air out the last of Winter with windows thrown wide to the Springtime sun. Polishing up your financial window may be a little more daunting. But Spring—and the kickoff of tax season—is the perfect time to clean more than cobwebs by getting your financial house in order, too.
Try these simple steps to get started:
Scrub out your wallet—Aside from the nooks and crannies of your car (and perhaps that mysterious magnetic field that is the top of every bedroom bureau), your wallet is likely to be the most frequent repository for things tucked away in haste and promptly forgotten. Make a refreshing clean sweep by literally dumping every last item, including credit cards, business cards, receipts, photographs, coins, and membership cards, onto an empty surface. Then sort everything into keep, toss, and file piles. Putting back only the necessary items will leave you with a slimmer, more manageable accessory and a terrific sense of accomplishment.
Clean up the mail mess—One of the best ways to get your financial house in order is to be organized. You may already have files set up for bank statements, paid bills, investment records and other documents that arrive, month after month, in your mailbox. Chances are, however, that a good number of those items are teetering in a messy pile somewhere very near that file drawer rather than neatly sorted inside of it. Set aside an hour or two to tackle that pile, putting everything, chronologically, in its place. When it’s time to prepare your tax return, you’ll feel like you’ve already gotten a great return on your (time) investment.
Scour your records—Sorting through your wallet may have unearthed some expired or rarely used credit cards. That’s a good reminder to check your credit report, which is a simple task most of us may let slide much longer than necessary. The Fair Credit Reporting Act entitles you to a free copy of your credit report once every 12 months from any one of the three nationwide consumer-reporting companies. A quick visit to www.annualcreditreport.com makes it easy to order your report, and you can review the results immediately if you place an online request. Once you’ve reviewed the report, follow up by cancelling old or unneeded credit cards and clearing up any issues that might damage your credit score.
Dust off your checkbook for year-end tax savings—Do you have grandchildren saving for college? Adult children working toward their first homes? Along with funding your own retirement accounts, you are entitled to give a sizable financial gift each year to your children, grandchildren, or anyone else without paying federal gift taxes. The total allowed per recipient is $13,000 but your spouse can gift money as well, doubling that amount. Pairing tax savings with generous giving is a great way to put a shine on your financial picture.
With Spring in the air, taking time to straighten up your dollars makes good sense. And once you’ve gotten your tax return neatly tucked away, you can turn your attention to counting the number of new flowers in bloom instead of your pennies.