“I wish I knew where all my money is going.” We hear this often when getting to know new clients. Sometimes people also aren’t sure how much they have, especially when they have multiple accounts in different places.
Like many anxieties, financial anxiety and stress can be caused by uncertainty. Focusing on things that you can control can help ease that anxiety. One easy way to start is by making a list of your accounts and balances, and tracking monthly spending. Once you know what you have and what you are spending, you can make conscious decisions with your money.
What comes in and what goes out
Consolidating investment and bank accounts helps form a clearer picture of what you have, what comes in, and what goes out. Some bank accounts offer teaser rates or cash bonuses to attract new deposits, but then the interest rates fall to almost zero. Consolidating bank accounts could mean that your savings would earn decent interest and be readily available when needed. Once you have a savings cushion, you can make investment decisions that grow your wealth. This can lead to greater freedom in making future life choices.
Growing Wealth might mean increasing your 401(k) contributions, starting a personal investment account, or even paying off car or credit card balances. Because loan rates are usually higher than bank interest, you’re ahead of the game by paying down debt.
A little organization goes a long way
Getting organized is one of the first steps in building a financial plan. A financial plan is the big picture, and helps you make financial decisions that are aligned to your goals.
Ask Us for a Checklist for more tips and to help stay organized. We have checklists for Young Professionals, Established Professionals, Planning for Retirement, Retirees and Executors.
