Monday, August 4, 2008

5 simple ways to simplify your finances

The simpler your finances are the easier it will be for you to stay on top of them and meet your goals.
  1. Pay all your bills on the same day.  Call up everyone who regularly sends you a bill - credit cards, utilities, mortgage, cable, internet, college loans, and anything else - and ask them all to change your bill's due date to the same day of the month (I use the 5th).  If your bills are all due at the same time, you are far less likely to forget one.
  2. If you use credit cards, only use one.  Only one bill to pay and one statement to check over.
  3. Pay your bills online.  Better yet, set up your bills to pay themselves out of your checking account automatically.
  4. Automate your savings and investing.  Are you contributing regularly to your savings account, retirement account, and college savings accounts?  If so, set it up so that every month money is automatically transferred from your checking account.  This eliminates the hassle and the chance that you will skip a month.
  5. Combine accounts.  Do you have more financial accounts than you need?  Combine some of them?  Do you have a 401(k) from an old job?  Roll it over into a rollover IRA at the same brokerage that manages your Roth IRA.  How many life insurance policies do you own?  Look into what it would cost to replace them all with one new policy.  This might not work out if your health has deteriorated, but life insurance rates have fallen in the past several years, so it is worth checking out.
Keep your finances simple and you will have more time for far more important things!  (Like reading interesting blogs or whatever else you like to do.)

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