How to Organize Your Finances

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By msblakely7
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Are your finances in order? Do you have specific financial goals and plans? It is extremely important to have control of your money rather than letting it control you. You cannot be sure that your money is being put to use in the best way possible and that it is working for you if you do not have it clearly organized. Take control today and get your finances in order.

Difficulty: Moderately Easy

Instructions

Step 1

If you do not already have one, you will need to get a file cabinet or a file box that holds hanging files. If you already have a file cabinet, I suggest clearing out one entire drawer for your financial documents. You will also need 8 or more hanging files with labels, and several(30-50) regular manila file folders.
Step 2

You will begin by labeling your first file "TAX RETURNS." This file will hold your tax returns for previous years. If you have saved your previous years tax returns, then you will use a separate manila folder for each year. Some suggest that keeping your tax returns for three years is enough, however if the government audits you, they can technically ask for records up to seven years back. So from now on add a folder each year for your tax returns. You will also need a folder for this year's returns, even though they have not been filed yet. In this folder, keep all important documents that you will need when it is time to file this year's taxes.
Step 3

You will label the next file "BANK ACCOUNTS." In this folder you will create a separate folder for each bank account that you have. From now on this is where you will file all the bank statements that you receive. It is a great idea to keep all statements, however if you bank online, you may feel it is unnecessary to keep the statements since they are archived online. Even so, I suggest keeping at least the most recent statement for every account.
Step 4

Your next file should be labeled "HOUSEHOLD ACCOUNTS." This file will hold a folder for your mortgage and mortgage statements, or your lease agreement. You should have a folder labeled home improvements, where you will keep track of all documents and receipts for improvements you do on your home. You should also have a folder that contains title to your home along with any other important documents.
Step 5

Next you will need a file labeled, "INSURANCE." This file will hold separate folders for each type of insurance that you hold, including health insurance, life insurance, car insurance, home insurance, and any other insurance policies you may hold.
Step 6

Label the next file "INVESTMENTS." This file will contain a folder for each investment account you hold. This may include IRA accounts, 401k accounts, mutual funds, stocks, investment properties, etc. Also, you should have a folder for your social security statements, which you receive each year from the government.
Step 7

The next file will be for "DEBTS and LIABILITIES." In this file you will create a separate folder for every debt that you have. Label a folder for each credit card account you have, car loans, student loans, and any other type of debt that you have incurred.
Step 8

You should also have a file labeled "WILL." Even if you are young it is still a good idea to have a will. You should review and update you will on a regular basis, such as every year or three years, and keep a recent copy here with all of your other financial documents.
Step 9

You may find that you have more files that you need to create for a category that I have not named. Or you may even want to break the files down into smaller or more specific categories. If you haven't saved your statements or important documents in the past, now is the time to start. Create all the files and fill them with what you have. As you continue to receive more statements and updated material you will have someplace to put them. The important part is that you have all of your financial documents organized into one place, where they are easily accessible and can be reviewed on at least a yearly basis. This should help you get a good start to organizing your finances.
Step 10

Check out the resources section below for more helpful information.