April 1st, 2013
Spring Clean Your Finances
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**Today’s guest post is contributed by Jim.**
Spring is in the air. At least it is where I live (until it turns cold again, as it did last week… but the warm days outnumber the cold ones!). The snow has given to rain and I get to run outside again instead of at my local gym. This time of year usually coincides with a keen interest in cleaning the home and yard, sprucing it up after a long winter of accumulating clutter.
You shouldn’t just limit spring cleaning to your home, though. Consider spring cleaning your finances as well.
Clean Out the Clutter
This first tip combines cleaning your house with cleaning your finances. Go through your home and find all that clutter. Figure out what you will no longer use, and get rid of it.
Here are some ideas of what to do with that clutter once you’ve cleaned it out:
- Sell It: You can get a little extra cash if you are willing to sell your stuff. Hold a garage sale, or sell your stuff online. You’ll enjoy a cleaner house… and a bigger bank account!
- Donate It: Another option is to donate your stuff to a charitable organization. You can get a tax deduction for donating your stuff to a qualified charity. Just make sure to get a receipt.
- Give It Away: Even if you don’t get a direct financial benefit, you can see the good effects from clearing out your house. Even better is if you empty out your storage unit and get rid of that monthly expense. Giving your stuff away can be just what the doctor ordered.
Shred Old Financial Documents
While you’re clearing out the clutter, consider shredding your old financial documents. You need to keep tax records for at least three years (longer if you claimed certain losses or if other situations apply). However, while you might want to keep certain documents for longer periods of time, there are plenty of financial documents that you should probably shred. Get rid of the documents taking up space in your home.
If you are feeling really ambitious, scan the documents you plan to keep and create a digital record. You can use this opportunity to go completely paperless. I did this several years ago and it’s reduced the amount of paper I store by 90% (so, not completely paperless!).
Evaluate Your Insurance Coverage
Next, make sure that your assets are adequately covered. Review your insurance policies, make sure you have the right coverage, and update them to the right amounts. You want to make sure that your home, auto, life, and health insurance policies all meet your needs. Also consider whether or not you need umbrella insurance and/or disability insurance. If you have a business, consider your business insurance needs as well.
Check Your Credit
Now is also a good time to review your credit. Get a free credit report from the credit bureaus via AnnualCreditReport.com and check for mistakes. Fix errors and make it a point to note which areas could use some improvement. You can also use free credit sites like Credit Karma to look at your situation and figure out how you might be able to change things around. Make a plan to improve your credit going forward, based on the information you get.
There are plenty of ways you can boost your finances this spring. What are your favorite financial spring cleaning activities?