“When you don’t know where your money is, when you have no filing system for your important documents, when you dive into your pocketbook to pull out crumpled bills, when your car looks like a garbage can, when your closets are filled with junk and clutter you cannot possibly be wealthy,” writes Orman.
Use the month of spring to clean out what you don’t need and let the money in.
Clean out your wallet
Clear out all the clutter from your bag and those till slips from your purse. Keep your rand notes in order (R10s, R20s, R50s etc) and make sure all the bills face the same way.
If your wallet is full of reward cards make sure you are claiming any benefits, especially if they expire. If you are not using the reward programme, get rid of those cards and clean up your wallet.
Clean out your cupboards
Think about the rand value of all the unused items in your household before you buy more: the pair of shoes you bought on sale but never wore; that potato crisper which promised fat-free chips but which you only used once.
Go through your clothes and household items and get rid of anything you have not used in 12 months. This can be a great way to make a few extra rand by selling items on platforms like Facebook MarketPlace or holding a traditional garage sale.
Sort out your admin
Could you easily access your important documents? Do you even know where they are? It is a lot easier to make good decisions or meet important deadlines like your tax return when your documents are organised.
Create a life book where you store all your important documents. This should include things like:
- Your latest bank statements and tax records
- Retirement documentation
- Investment policies
- All your short-term insurance policies
- Risk policies and long-term insurance policies
- Your updated Last Will and Testament
- Birth certificates
- Medical details
Create a spreadsheet with all your investments, bank accounts and risk cover including product providers and account numbers so that there is a single piece of paper that records all your financial information so you don’t need to page through a folder each time you need the information.
Not only does this make it easier for your family if something happens to you, but in undertaking this exercise, it is not uncommon for people to discover policies or investments they have forgotten about. What more motivation do you need?
It goes without saying that you do not want to hand in your tax return late. Make sure the taxman has your correct banking details. SARS will pay your refund into the bank account they have on record. If you closed your bank account several years ago your bank may have reallocated the account number to a new customer. If your refund accidently gets paid to the wrong person it is not SARS’s responsibility.
Review your bank statements
Sorting out your admin also means managing your bank account. By being organised you won’t miss bill payments or allow bounced debit orders – it will save you not only unnecessary bank charges but also your credit record. Also check your bank statement regularly to ensure there are no unauthorised debits.
Review your protection
Part of being financially organised is knowing you have measures in place to protect you and your family. When was the last time you reviewed your life cover? If you haven’t changed the beneficiaries since you got married, and your policy leaves everything to your mother, it may not be what you intended.
Make sure your wishes are carried out by updating your will and ensuring your retirement fund has an up-to-date beneficiary nomination form. Should you die, the trustees of the retirement fund are obliged to pay out your retirement benefit to your financial dependants. If you have not updated it to reflect all your children, for example, this will increase the time taken to resolve the payout.
This article first appeared in City Press.