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Blog: Minimizing Financial Clutter
 52 WEEKS TO FINANCIAL ORGANIZATION: #8 – Order in the Wallet
"When your finances are in order, your life is in order."
That's a profound statement; I wish I could take credit for it. Instead, I heard it this morning on a local bank's radio commercial.
The statement is true, isn't it? The state of organization of our financial resources is a very good indicator of how well the other aspects of our lives are in order. As a professional organizer, I see the correlation all the time. The households with a lesser amount of physical disorganization also seem to have their finances in order.
What does financial organization mean? I think that a person whose finances are in order has the following characteristics:
1. He (or she) has made conscious decisions about his priorities, and spends or saves his money accordingly.
2. He knows how much money he has.
3. He keeps good financial records.
So, how financially-orderly are you? Here's a good way to test yourself: Pretend that you are in the process of applying for a new mortgage. The lender has asked you to complete a balance sheet – a listing of everything you own (your assets) and everything you owe (your liabilities). How easily could you pass that test? Do you know the value of your investments and property? Do you know how much money you owe your creditors? How long would it take you to find the paperwork that would give you that information? In the coming weeks, we'll look at ways to help you track your balance sheet information.
Last week, I asked you to keep track of all your spending for the week – every penny of it. How did that go? Just so you know, I've been tracking my own spending, too. What an eye-opening experience! The simple act of having to track my spending caused me to really think before I made a purchase. In some cases, I even decided not to make the purchase at all. I became aware of just how much money I fritter away each week. Multiplied by 52 weeks per year, it was a shocking amount of money. It was money that I could have spent or saved for something more important to me than those impulsive purchases.
Your Homework for This Week:
· I want you to continue to track your spending for the month of March. A week of keeping track was a good start – and I applaud those of you who did it. Keeping track for an entire month will give you a very good snapshot of your priorities (whether they are consciously-determined priorities or simply old spending habits).
· At the end of the week, categorize your purchases and total each category.
You need to understand the present before you can make adjustments for the future.
When your finances are in order, your life is in order.
posted on: 3/1/2009 11:30:00 AM by Katherine Trezise
category: Finances
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Minimizing Financial Clutter
by Katherine Trezise
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About Katherine:
Katherine Trezise is president of Absolutely Organized, based in Baltimore, MD. She is president-elect of the National Study Group on Chronic Disorganization. Katherine holds a masters degree in business administration, is a Certified Professional Organizer® and a Certified Professional Organizer in Chronic Disorganization®. Absolutely Organized specializes in helping people organize their homes, paperwork and financial records to make room in their lives for the things, people and activities that are most important to them.
Katherine's Website:
www.absolutely-organized.com
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