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Clean up the Cobwebs and Your Finances

by:
Kerri Barreca

 

I have to admit it, I love spring cleaning.  My winter coat and boots get cleaned and put away for good, the mop makes an appearance and I get to declutter my living space.  What better way to say hello to spring? 

So why not apply this same principle to your finances?  According to Dave Ramsey, a good strategy is to tackle one area at a time.  Just like you don’t have to clean the whole house in one day, pick one area you’d like to start with and focus on that.  Concentrating on a small task, like contributing to an emergency fund or paying off your credit card (or one of multiple credit cards) first is less daunting and will keep you motivated to keep plowing forward with your goals.

It’s smart to keep tax records for at least 7 years but after that send them to the shredder!

I recently did a cull of not only old clothes but old financial documents.  I had old pay stubs dating back ten years in a drawer and old copies of tax returns that were taking up precious space.  It’s smart to keep tax records for at least 7 years but after that send them to the shredder!  Similarly, consider sifting through extra service charges with your bank, phone provider etc. and think about sending them to the can.   Ask yourself, “Do I really watch 200 cable channels or is 50 enough?” “Do I actually use call waiting?” Little cuts here and there to your budget can add up over time. Our Credit Canada budget calculator can give you an idea of just how much you can save by cutting the fat.

As you are sifting through your closet or garage, be sure to take an updated inventory of your valuables.  It’s good to have photos and documents of these items for insurance purposes and be sure to keep these records in a safe place like a safety deposit box at the bank.  In case of fire or theft you’ll be glad you did this extra step.     

Consider sifting through extra service charges with your bank, phone provider etc. and think about sending them to the can.

Believe it or not, literally cleaning your home may actually save you a few bucks.  By cleaning the gutters or cleaning the greasy inside of your oven, you are prolonging the life of these items. Regular upkeep of your home and appliances means not having to pay for repair or replacement as often.  So grab those rubber gloves and get started! Another idea, if you don’t donate old clothes to charitable causes, is to organize a garage sale. Spring cleaning is the perfect opportunity to make a little cash.  With the $200 or $300 you make from sales, consider contributing it to your RRSPs, emergency fund or use it to help pay off some debts.  Or go shopping if you can afford to-it’s bonus money after all!

So grab that pail, mop or rake and clean away the dirt and dust.  But don’t forget your finances can also use a seasonal clean up as well. 

It might be helpful to create a checklist and tackle these things at your own pace. No need to rush – nobody is watching your progress. 

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