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I’ve received a lot of questions recently about how we organize our money and all the different bank, investment, credit card accounts we have. I’m kind of flattered that people assume I’m organized.
But to be totally truthful, I am the most disorganized organized person you’ll ever meet. I’ve always wanted to be that woman with the perfectly neat desk, beautifully arranged drawers, and expertly styled bookshelf. But I am not her.
I remember in my first job out of college, a client walked in, saw my desk, and nearly doubled over with disdain as she told me, ”a cluttered desk is a sign of a cluttered mind.” Thanks for that.
The majority of my house is clean and organized (including my exceptionally well-organized closet!), but my office is a sight. At any one time, I have 15 post-its scattered around my desk reminding me of various to-do list items. I have piles of paper everywhere. Right now I have 8 flash drives sitting on my desk and I have no idea what’s on them.
Jordan, a meticulous organizer who has folders for receipt type and year, is often dismayed by my hanging file folder system.
I have one folder. It’s labeled: important.
And most things in that bulging file are probably important.
Or were important.
Or might be important in the future.
The only thing that keeps me from being a total mess is having a simple system.
Every Friday I throw away pieces of paper I don’t need. I have stacks of items in my office within reach of my chair, each organized by order of importance.
It has to be simple, otherwise, I’d be a complete and total mess. Like most people, we have a lot of accounts in a lot of different places and I really don’t want to spend much time keeping it all in order. I spent some time putting together a system so that I could just “set it and forget it.”
If you’re not the most organized person or if you’re embarrassed by the state of your accounts, it’s ok. There is a solution. And once you get it set up, managing money will be simple.
Step 1: Label your savings accounts
This is one of my favorite things to do. I like having my money split into a bunch of different categories. This isn’t necessary to do, but it makes me feel organized.
For example, these are some of the savings accounts that we have:
- Emergency fund
- Vacation fund
- Move fund
- Freedom fund
- Property tax savings
- Business tax savings
When our emergency fund is full (for us that’s 6 months of expenses), I know we can stop sending money there. We plan on traveling and moving this year, so we’re actively saving in those two accounts. Our freedom fund is my favorite savings account: we’re saving money for Jordan to make a career shift, and this account will help us do that.
We use the other two savings accounts to set aside money monthly for irregular expenses, like our bi-annual property tax payments and our quarterly business tax payments. Saving for these monthly takes the sting out of paying the bill when it arrives.
Step 2: Draw yourself a money map
Here’s the gist of how we manage our cash flow each month:
- Money comes into our checking account via our paychecks
- Money is automatically transferred to savings and investment accounts
- Bills are paid automatically, all toward the beginning of the month
- The money that remains in our checking account is for us to spend
You can read more about this in the Complete Guide to Creating Your Spending Plan.
Once you have that setup, don’t accidentally forget the most important part: documenting your money map.
There’s nothing worse than needing to make a change to your savings and having no idea what day payments are taken, what account they’re taken out of, and where they’re moved to.
This document doesn’t need to be anything fancy, but trust me, you’ll want to have it. You can draw yourself a little map like this if you like a visual approach:
Jordan and I use an Excel document that has just a few columns: date of transfer, account from, account to, and amount. Any time we make a change, we change this master spreadsheet.
Step 3: Catalogue your automatic payments
We have a lot of things that we’ve signed up for that we automatically get charged for monthly or annually (utilities like internet, cell phones, and electric bills, as well as other spending like iCloud storage). We also have some important bills that we pay automatically, such as our life insurance.
Ask me to name these automatic charges off the top of my head and I can’t remember what they are or when we pay them. That’s not great when you need to make changes.
For example, one of my credit cards expired and I needed to update my card number on some of our automatic payments. The problem was, I couldn’t remember exactly what needed to be changed. Annoyingly, I had to look through old statements to make sure I updated every account with an automatic payment from that credit card.
That’s why on our master spreadsheet we have a second tab. On this tab, we have a list of everything that we pay automatically. Again, it’s not fancy. We have four columns set up: date, paid to, amount, and from what account or card.
Step 4: Roll-over rogue retirement accounts
This is not nearly as intimidating as it sounds. I spent far too long with my retirement account sitting with old employers or in old investment accounts that I didn’t really understand. I likely paid too much in fees and lost out on investment growth.
Contact your old employer and take 15 minutes to figure out how to start the roll-over process. Having your money all in one place makes managing it that much easier.
Step 5: Figure out how to track things, easily
Like most people, Jordan and I have a number of accounts. We have savings accounts, taxable investment accounts, retirement accounts, joint and solo checking accounts, a business checking account, and a business savings account. We also have a mortgage and a checking account at the bank where we have our mortgage.
Oh, and we have treasury bonds. Can’t forget those.
As you can see, things can get messy really quickly. And when things are messy, it’s hard to make good decisions.
Finding a way to track our money easily has been a game-changer in money communication between Jordan and me.
Up until getting married, I kept track of everything that wasn’t a checking or savings account in my head. I had a few retirement accounts that were still with my old employer (whoops) and I had two other retirement accounts with two different brokerages. I had a taxable investment account. I had my student loan. And I had two credit cards.
I had financial breadcrumbs spread all over the place. I knew where they were, but they weren’t organized, let alone optimized.
Jordan, being the extremely meticulous, organized person that he is, had a spreadsheet where he would track our net worth quarterly. When we got married he asked me to add my accounts to the list.
Each time Jordan would sit down to update his spreadsheet, I’d somehow remember to tell him about one more account that I’d previously forgotten to mention.
I sound like a mess, but I knew where everything was. I just didn’t have it written down and I didn’t have the attention span to sit with him and catalog everything into his spreadsheet.
I could sense his frustration with me a few months ago when I remembered to tell him about another account I’d failed to mention in our last 5 years of marriage (it was really small, to be fair).
When looking around for an option to make life easier, I stumbled upon Personal Capital. They have a free tool that was designed to make you more knowledgeable about the overall picture of your money.
I signed up for an account, connected all of our bank, investment, retirement, and mortgage accounts, as well as our credit cards. It was simple, other than the fact I had to track down all of the passwords I’d forgotten. It’s amazing how quickly you can amass so many accounts.
Now that everything is connected to Personal Capital, either one of us can log in and get an instant snapshot of our accounts and balances, all in one place.
I honestly really like being able to log in and see how much is left on our mortgage and remind myself of what’s in our retirement accounts. It’s kind of like a Mint, but for your overall financial health, not just your monthly budget.
While this is an extremely powerful website with tools to help you analyze your investments, it does something much more basic than that: it helps me stay organized. If you want to a full review and video tutorial for Personal Capital, you can get that here.
Jordan was able to ditch his spreadsheet and we connected all of our accounts to this: all bank accounts, retirement and investment accounts, credit cards, and our mortgage accounts.
It’s cleared away so much mental clutter for me. Maybe I’ll work on clearing away the desk clutter next.
And since the tool itself is free, it was an easy decision for me to create an account and set it up.
(note: that is an affiliate link, but it’s a free tool I use and love and really wanted to share. For more information on affiliate links, see this disclaimer.)
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