By Antonio Porretta
New research is coming out that proves how clutter causes stress. (1) The messier our houses, our desks, or our calendars, the greater our anxiety, even if we don’t realize it. The same goes for your finances. If you have paperwork sitting in disorganized piles, you can’t keep track of your many accounts, or you don’t even remember the last time you revisited your insurance policies, your financial house may be cluttering your mind and stressing you out.
The hard part is that many people don’t know where to start when it comes to decluttering. We know it can seem overwhelming, and while we can’t come to your house to help you purge, we can give you 5 proven steps you can take right now to gain control of your finances.
1. Organization Comes First
The first step in evaluating your current financial situation and whipping it into shape is to get organized.
Use A Password Management System
Do you have a system for keeping track of your countless usernames and passwords? You’ll save yourself some headaches if you can find a method to keep all your information in one place. There are plenty of online password managers to choose from that will protect your information and make it easy for you to stay on top of your accounts and policies.
Go Green
If you want to minimize the amount of paper that piles up on your counters, save a tree and get rid of clutter by enrolling in paperless document delivery for all your bills and financial services. Since you’re planning to create a password management strategy, the only thing you’ll need to do to access account details is find your login information and be on your way.
Check Your Credit
When was the last time you checked your credit? For most Americans, it may be hard to remember. You’re legally entitled to a free copy of your credit report every year from each credit bureau. You can request your free copy at https://www.annualcreditreport.com/index.action.
Keep Financial Documents Safe
Store physical documents (such as your will, trust, and deed) in a fireproof safe. Keep the safe with a trusted professional or loved one.
Communicate With Family
Develop a master directory that lays out all your financial information to help you manage your affairs and serve as a guide to your family members if they ever need to assist with your finances. Be sure to include account numbers and logins and keep this document password-protected or under lock and key.
2. Then Track Your Spending
A strong budget lays the groundwork for financial stability. As much as you may hate tracking expenses, knowing your inflows and outflows is the first step in reaching your financial goals.
Add up all your income and subtract your monthly expenses. If you’re living beyond your means, look for serious ways to cut down on your spending. If you spend way too much money on discretionary items like clothing, for example, give yourself a monthly allowance and stick to it.
Remember, your budget isn’t set in stone. You can always adjust your budget as you meet your financial goals. After all, the purpose of fixing your finances is to create a better life for yourself.
3. Next, Build An Emergency Fund And Tackle Debt
Emergency funds aren’t “one size fits all,†and it’s best to come up with a number based on your income stability and family. A good rule of thumb is to have three to six months’ worth of expenses on hand.
Debt keeps you living paycheck to paycheck, which destroys your quality of life. There are several debt payoff methods out there, but two popular ones are the debt snowball and the debt avalanche. Talk to an experienced professional—such as a financial advisor or financial planner—about which method may be best for you.
4. Don’t Forget To Protect Your Assets
You’ll begin to accumulate sizable wealth as you pay off debt and save. In the event something happens to you, ensure your family is taken care of well by protecting your assets. A few ways you can protect your assets:
- Create or update your will.
- Update beneficiaries.
- Analyze insurance coverage.
- Evaluate investments and retirement contributions.
5. Finally, Don’t Do It Alone
Getting your finances in order can be an overwhelming process, but the choices you make today will impact where you end up tomorrow. Thankfully, you don’t have to walk the path to financial independence alone. No matter where you are in the process, our team at Blackbridge Financial can help you integrate and organize all aspects of your financial life.
We’re here to walk with you through every step. From getting your financial house in order to living out your years in retirement, you can count on us to be there for you. To learn more about how we at Blackbridge Financial can help you pursue your financial goals, email me at antonio.porretta@lpl.com or call 704.960.9646.
About Antonio
Antonio Porretta is an independent wealth manager at Blackbridge Financial with 18 years of experience. He specializes in helping people create, distribute, and preserve their wealth. Antonio received an executive MBA from Saunders College of Business at Rochester Institute of Technology in 2007 and also holds the Accredited Asset Management Specialist (AAMS®) designation. Originally from Rochester, NY, Antonio has been a resident of Harrisburg, NC, since 2007. Outside of work, he enjoys playing soccer and tennis, coaching, and spending time with his wife, Laura, and their children, Cristiano, Victoria, and Matteo. To learn more about Antonio and how he can make a difference in your financial life, visit www.blackbridgefinancial.com.
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Securities offered through LPL Financial. Member FINRA/SIPC. Investment advice offered through Independent Advisor Alliance, a registered investment advisor. Independent Advisor Alliance and Blackbridge Financial are separate entities from LPL Financial.
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