Declutter Your Financial Life

Misplaced bills, late payments and forgotten invoices can cause plunging credit scores, penalties and unnecessary stress. Protect your money—and prevent a headache—by ringing in the New Year with a resolution to organize your finances.

File as you go. It’s tempting to stack mail and other documents in an “I’ll get to it later” pile. Break this habit. Open your mail the day you receive it and determine if the contents need to be filed or can be tossed. Take the appropriate action. This will only take a few minutes each day.

Store important documents properly. Hard-to-replace documents such as vehicle titles, stocks and bond certificates, and property deeds should be kept in a safe-deposit box. Store other files in a filing cabinet or box for easy access and organization. Arrange the files alphabetically by category, and separate them into “permanent” and “active” sections. Keep documents that are completed but need to be accessible—such as tax records—in the permanent section. Items that still need action—such as bills—go in the active section.

Discard old documents. Sort through your files at least once a year and dispose of or shred any unnecessary documents. Move paperwork that is inactive but needs to be retained to the permanent section of your files. Learn more about which financial records you should keep and which you can toss here.

Cut down on mail. Reduce the number of statements that arrive in your mailbox by signing up for as much paperless billing as you can. Also consider cutting back on the number of credit cards you have and consolidating financial accounts, if possible. The fewer individual bills you have, the less time you will spend organizing and writing checks to settle them.

Pay bills online. Clear your desk and improve your recordkeeping by shifting payments from paper to electronic. Online account and banking services allow you to track activity, pay bills and transfer funds on your own time, wherever you are. And many online banking services let you download your transactions to your financial management software. State Farm Bank® offers many ways to access accounts and pay bills, including online and with a smartphone.

Find worksheets, calculators and other tools that can help you organize your financial life at MyMoney.gov.

The information in this article was obtained from various sources. While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. The information is not intended to replace the advice of a qualified professional. Nor is it intended to effect coverage under any policy. State Farm makes no guarantees of results from use of this information. We assume no liability in connection with the information nor the suggestions made.