Perfectly Imperfect Family and Finances

Posted By Mr. Imperfect on February 18, 2009

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Has your financial documents and other important information ever looked like this?  Ours did not too long ago.  When we first started to get out of debt and try to take control of our finances we really had no idea where to begin.  Our bills were in the house somewhere(or so we thought).  We ended up just making guesses at what we owed to whom when we made our first budget and debt list.   Now, we can lay our hands on most any document we need in less than 2 minutes.  Here is how we got started:

1. We started a file system Originally this consisted of tan manila folders in a pile (a filing cabinet was a luxury at the time we were going to do without).  We had each bill we owed in its own little folder.  Then we placed the bills in groups: credit card debt, personal loans, car loans, and household expenses (mortgage, insurance, taxes, phone, electric, water, etc.) These eventually migrated to a box that had once held reams of copy paper, and from there into a filing cabinet.
2. We processed immediately As soon as the mail came through the door it had a place to go.  If it was a bill it was placed in the “to be paid” folder in whatever position it needed to be based on date. Once paid it was transferred to the correct account folder.  If it was a bank statement it was reconciled and filed.  The point is that most of our disarray was caused by just laying the mail down when we came in and forgetting about it.
3. We started a master list of bills This is a tip I read about over at No Credit Needed.  The list contained all of our bills, the estimated balance, the interest rate, and the date due.  At any moment we can look and see where we stand on our consumer debt.
4. We started an account and number list Another idea we gleaned from NCN.  The list has all our accounts (bills, checking, savings, etc.) with the name of the account, account number, account balance, address, and any relevant phone numbers.
5. We go over the finances once a month If you are in a relationship that you share financial responsibility in, it is imperative that you communicate and keep each other informed. It also helps that you are looking at the progress made together.  It makes it easier to say no to the $20 container of coffee and go with the $12.

That is what worked for us.  We started cutting expenese (who really needs to spend $130 a month on movie rentals?) and earning a little extra here and there.  It is paying off  in huge dividends right now.  We just paid off one of our personal loans last month, and we are on track to reduce our overall debt by 40% this year.

Thanks for reading, we hope you have a great and wonderful day.  Feel free to leave an orginization tip that has helped you in the past, or make a suggestion on a topic you would like to see on here.  Take care.

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• It Pays to be Financially Organized

Category: Finances, Goals, debt reduction
Tags: debt reduction, Organization, personal finance