Spring-clean your finances

springclean

Spring is in the air for most parts of the country (except Cape Town) and as the end of the year hurtles towards us, this could be a great time to clean out your financial clutter and spring clean your finances.

While spring cleaning is traditionally associated with housework or even sorting out your office desk, it is a vital aspect of managing your money in order to achieve financial wealth. This means keeping track of where your money is going by filing your financial records, making a note of your expenses and filing, filing, filing.

International money coach, Julie Shea says one of her biggest complaints from clients is that they don’t feel like they have a handle on where their money is going. “All it takes is discipline and a bit of time. For example, with online banking, it is easier than ever to take a look at where your money has gone,” she says.

Your quick guide to financial spring-cleaning:

  1. Clean out your wallet: Get rid of all the tiny cash slips that are loading your wallet down. Instead of stuffing your wallet, you could set aside a small box where you keep these slips and then reconcile them with your bank statement or make a note of your expenses at least once a month.
  2. Physically organise your cash: As silly as it may sound, research shows that you tend to spend less and keep better track of your money if it is actually organised in denominations within your wallet. So, take time to arrange your money in descending order.
  3. SARS documentation: Sars requires you to keep supporting documents for up to five years. Go through your filing cabinet and clean out the documents you no longer need – for example, that itemised Telkom/MTN/Vodacom billing statement from 2004 really can go in the bin now.
  4. Check your estate planning: Make sure that important documents, such as your will, are easily accessible. Ideally, you should have a copy of your will at hand in your home and another copy with your lawyer or financial planner. Ensure that your will has been updated in line with any recent deaths, births or marriages that may have taken place in the last year. The same can be said for your retirement fund and life assurance beneficiary nominations. Make sure these nominations are updated timeously.
  5. Clear out your wardrobe: Get rid of clothes that you have not worn in the last year to two years. You can donate them to charity or sell them at a second-hand clothing shop and earn a tidy sum of cash plus the peace of mind that comes with having a closet that’s not exploding with clothes “but nothing to wear”.
  6. Update your files: In this modern day and age, you can easily keep track of your filing with electronic statements. Check that your statements are filed properly and are up-to-date. You should also check that all your bills have been paid on time. If you can set up a debit order for payments, that is usually the easiest way to manage payments. The National Credit Act allows creditors such as the municipality, your child’s school and even your doctor to charge you an additional two per cent interest per month for missed payments.
  7. Unauthorised payments: These can easily slip through the cracks. Trawl your bank statements and query any debits that look unfamiliar. Check for small amounts of money being siphoned off your account, debits that go off twice and are not refunded as well as old debit orders that should have been cancelled but are still going off your account.
  8. Loyalty programmes: Do a recon of the loyalty programmes you belong to and find out how you can maximise the value you receive from them. For example, if you have outstanding Clicks ClubCard vouchers (they are valid for a year) or you have lost your vouchers, you can contact your loyalty programme administrator to find out if they can send you replacement vouchers.
  9. Bank fees: Keep your bank on its toes. Shop around and compare the account you are currently using and the fees you are paying compared to other banks. Reconcile your actual bank usage (number of debit orders, cash withdrawals etc) with the package you are on and ensure that you are making the best use of your bank.
  10. Household contents and motor insurance: You may have bought a new plasma television, jewellery, an iPad or a dishwasher over the past year. Check that your household contents insurance cover has been updated. Similarly, your car is a depreciating asset. Check that your insurer has adjusted the insured value of your car and that you are not over-insured.
  •  This article was first published in City Press on 15 September 2013. 

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