11 Tips for Spring Cleaning Your Finances
By Jeanine Skowronski
We tend to associate spring with cleaning out our closets, scrubbing our floors and repairing any damage our homes incurred during the winter. But the season for renewal can also be the perfect time to get our financial house in order.
Here are 11 ways to spring clean your finances.
1. Craft (or Re-Balance) Your Budget
Calculate how much money you have coming in versus how much money you have going out, and see if you should make any adjustments to your weekly and/or monthly spend. If you need help spotting the money wasters, consider using a budgeting app like Quicken, which can track your spending habits and illuminate expenses that are really putting a drain on your bank account.
2. Trim the Fat
Got a gym membership or streaming subscription you just aren’t using? Go ahead and cancel it. Spending way too much money at restaurants? Draft a meal plan and/or start eating at home. Chances are, there’s at least one or two guilty pleasures you can cut back on that’ll help boost your bottom line.
3. Shop Around
Some expenses may seem fixed, but, truth be told, you can lower almost any bill you receive each month. Shop around for new service providers and see if any of those quotes can help you negotiate a better contract with your current ones. If your cable company, mobile carrier, auto insurer or even utility provider aren’t willing to strike a deal, consider taking your business elsewhere.
4. Get Your Credit Check On
You’re entitled to a free credit report from each major credit reporting agency every 12 months, so if it’s been awhile since you’ve thoroughly checked your credit file, now’s the time to go ahead and request one or all of them via AnnualCreditReport.com.
A good credit score is instrumental to securing an affordable loan or more, and you won’t be able to improve if you don’t know where you stand. Plus, there could be errors or line items (like a surprise collection account) that are weighing down your scores. Speaking of which …
5. Dispute Any Errors You Find
Credit report errors are actually fairly common. A 2012 Federal Trade Commission report put your odds at one in five. If you spot an inaccuracy on your file, be sure to formally dispute it with the credit bureau in question. (You can go here to learn how to do so.)
If your credit is in great shape, consider using it to upgrade. A solid rewards credit card is a great way to get a kickback from your purchases. Just be sure to pay any balances off in full; otherwise you’ll offset those points, miles or cash back with the interest you end up paying. If you need to make a big purchase soon or tend to carry a balance, a low-interest or 0% introductory APR credit card could come in handy. And if your credit has really improved since you last checked, you might even want to look into refinancing your mortgage or auto loan.
7. Draft a Plan to Pay Down Your Debts
If your credit is being weighed down by a boatload of debt, come up with a plan to get back in the black. Consider a balance transfer credit card or debt consolidation loan to address high-interest credit card debt. And if things are really dire, look into credit counseling or a debt management plan.
8. Set Some Savings Goals
That’s because building up your coffers is just as important to your overall financial health as paying down your balances. Some simple savings goals include building a proper emergency fund (experts recommend socking away at least three months’ worth of expenses), putting aside a few hundred dollars for holiday gifts, and upping any automatic rollovers from checking to savings.
9. Evaluate Your Investments
If you’re not saving for retirement, well, now can be a good time to start. And if you are, consider upping your contributions — particularly if they involve an employer-sponsored 401K that has a sweet company match you’re not taking advantage of.
10. Adjust Your Tax Withholding
Given that you’ve done or (hopefully) are about to do your taxes, now’s the perfect time to make an adjustment to those returns. A big return may seem like a good deal, but it means you were paying Uncle Sam way too much during the fiscal year. Conversely, if you seriously owe the government, consider authorizing your employer to take more taxes out of your paychecks over the course of 2017.
11. Change Your Passwords
When it comes to guarding your bank accounts, it’s easy to set a password and forget it (in more ways than one). But given how prevalent data breaches have become in the digital age, and how readily we tend to share information, it’s a good idea to change the locks on your financial accounts and more at least once a year. Remember, the best passwords are long and strong, include numbers, letters and symbols and, perhaps most importantly, don’t involve any easily guessable information — like your birthday or a pet’s name.
Jeanine Skowronski is the executive editor of Credit.com. Her work has been featured by The Wall Street Journal, American Banker, TheStreet, Newsweek, Business Insider, Yahoo Finance, MSN, Fox Business, Forbes, CNBC and various other online publications.