Getting organized is the essential first step to getting ahead financially. An organized system for your financial records will help you stay focused and on top of your bills throughout the year. Tracking spending and finding documents will be a snap. Here’s what you need to get started:
1. A Filing Cabinet or File Box 
If you don’t already have a metal filing system a plastic file box, available at all discount stores, is a great alternative. You need to have one place to keep your current-year files. If you are lucky enough to own an existing file cabinet, designate one drawer for the current year.
2. File Folders 
Create a file folder for every bill or statement you receive monthly. These files should live in the File Box or the drawer in the File Cabinet designated for the current year. Designate a file folder for everything you get in the mail on a regular basis: phone bill, utility bills, bank statements, credit card statement, subscriptions, paycheck stubs, etc. Here’s where you can have fun. Pick some bright colors and coordinate your files. Use labels and funky fonts. When paperwork arrives each month (and bills are paid) it now has a place to live that’s not a garbage bag shoved in a corner.Â
3. Sturdy Expanding File 
In addition to the file folders that were described above, designate a plastic expanding file envelope for “Permanent†files, things that are updated less frequently than monthly. In this sturdier folder keep paperwork that does not change or update itself yearly. Think: health documents, auto titles, apartment lease or mortgage. These should be kept in the back of the same “yearly†file box (or drawer) for easy access when you need to find a copy of that lease you signed two or three or years ago.
4. Plain Expanding Files 
At the end of each year, usually after you file your taxes, take all the prior year files out of the box or drawer and file them away in a plain cardboard expanding file – clearly marked with the year they represent. This self-contained folder can now go into longer-term storage, even if it’s the back of a closet or under the bed.
5. Small Check File 
Save your receipts! A small, plastic file, often used for coupons, is perfect for saving receipts. Designate each section for every plastic card you use: ATM card(s), credit cards, store cards, etc. You can also designate a section for cash purchases. Every month when your statements arrive, take out the receipts and match them (“reconcileâ€) to the statements. Match debit card receipts to bank statements, credit card/ store card receipts to their statements. This should be done every month. You’d be surprised how often banks and credit card companies make mistakes.
The five items above will get you a great start towards organizing your finances. This is the basic groundwork that will help you better manage your financial life.
September 4th, 2008 at 2:33 pm
I have a folder for current due bills, one for those that have been paid but are waiting to be filed and a filing cabinet with the past twelve months of all bills and statements. Good records are a lifesaver when the rare time comes that you need access to them.
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