You can spring clean your finances just as you would your home. 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 — whether it's decreasing your monthly expenses or increasing your savings — and do a little financial spring cleaning as well.
Spring Cleaning 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 in your finances 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.
How You can Declutter Your Finances and Decrease Monthly Expenses
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 as well. Ask yourself, “Do I really watch 200 cable channels or is 50 enough? Do I actually use call waiting or voicemail services?” Little cuts here and there to your budget can add up over time. Our budget calculator can give you an idea of just how much you can save by cutting the fat in your budget.
Take an Inventory of Your Belongings for Insurance Purposes
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. You’ll be glad you did this extra step in case of fire or theft.
How Spring Cleaning Can Save You Money
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 repairs or replacements as often. So grab those rubber gloves and get started!
Another idea: If you don’t donate old clothes to charitable causes, organize a garage sale. Spring cleaning is the perfect opportunity to make a little extra cash. With the extra $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!
Credit Canada is Your Debt Clean Up Crew
It might be helpful to create a checklist and tackle these financial items at your own pace. No need to rush – nobody is watching your progress. But if you are struggling with debt, living paycheque to paycheque, with little-to-no savings, it can be very difficult to make ends meet on your own. A free counselling session with one of our friendly credit counsellors could be just what you need. Give us a call at 1.800.267.2272.
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.
Frequently Asked Questions
Have Question? We are here to help
What is a Debt Consolidation Program?
A Debt Consolidation Program (DCP) is an arrangement made between your creditors and a non-profit credit counselling agency. Working with a reputable, non-profit credit counselling agency means a certified Credit Counsellor will negotiate with your creditors on your behalf to drop the interest on your unsecured debts, while also rounding up all your unsecured debts into a single, lower monthly payment. In Canada’s provinces, such as Ontario, these debt payment programs lead to faster debt relief!
Can I enter a Debt Consolidation Program with bad credit?
Yes, you can sign up for a DCP even if you have bad credit. Your credit score will not impact your ability to get debt help through a DCP. Bad credit can, however, impact your ability to get a debt consolidation loan.
Do I have to give up my credit cards in a Debt Consolidation Program?
Will Debt Consolidation hurt my credit score?
Most people entering a DCP already have a low credit score. While a DCP could lower your credit score at first, in the long run, if you keep up with the program and make your monthly payments on time as agreed, your credit score will eventually improve.
Can you get out of a Debt Consolidation Program?
Anyone who signs up for a DCP must sign an agreement; however, it's completely voluntary and any time a client wants to leave the Program they can. Once a client has left the Program, they will have to deal with their creditors and collectors directly, and if their Counsellor negotiated interest relief and lower monthly payments, in most cases, these would no longer be an option for the client.