Managing Money: 3 Clear Steps To Organizing Your Finances

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Being organized isn’t a strong suit for many people.

I’m not talking solely about managing money.

People have trouble organizing lots of things, like:

  • Closets
  • Garage
  • Pantry
  • Office
  • Sock/Underwear drawers

People just have trouble keeping things sorted in general.

It’s also a common issue with managing money, too.

People have trouble keeping track of:

One reason is just being messy.

Another problem I’ve encountered in my accounting career is the attitude that “more is better” when it comes to financial accounts.

Apparently, the more interest-bearing and investment accounts, as well as credit cards people have, the more wealthy they feel.

Or they still play the rate-chasing game.

However, this is a big mistake in many cases.

It can lead to certain problems like:

  • An inability to make a budget
  • Knowing how much money you have at a certain point in time
  • Trouble tracking income & spending
  • Overdrafting or bouncing a check
  • Even getting their income tax return prepared.

But there is hope for all you organizationally challenged folks out there, and it’s quite easy to implement.

In fact, you can do it in 3 easy steps…

1. Managing MOney Means Fewer Accounts

$100 bills stuffed into glass jars labeled health, house, saving, travel, charity and education for money management purposes
One of the keys to successfully managing money is being organized, although you don’t need to be this organized and detailed when managing finances!

The fact that banks tend to reward people for bringing in new money contributes to the confusion.

It makes things worse for some people, as it creates yet more paperwork.

That and another chance to mess things up.

In some cases, people open up different accounts to serve different purposes:

  • Household checking and savings
  • Vacation fund
  • Holiday fund
  • Emergency fund
  • College fund

This type of segregation may be good for saving purposes.

It is, however, a killer in terms of keeping track of all the money.

Then you have brokerage accounts:

  • A 401(k) with from each past employer + current
  • An IRA at a different brokerage
  • Separate taxable investing accounts

Don’t forget about credit cards, too!

I had one particular client last who had 1099-INT statements from 27 different financial institutions.


That is ridiculous for one person or family to have unless they have so much cash that they need to separate their cash accounts because of FDIC limits.

But, if that doesn’t describe you, then start closing accounts now.

Keep a household checking account to cover the everyday expenses and recurring bills, a savings account, and maybe another interest-bearing account for short-term planning like trips and gifts.

If you have more than one IRA or multiple taxable brokerage accounts, transfer everything into just one for each type.

There really is no need to have multiple accounts at different brokerages unless you have a lot of money to invest.

Then it’s ok because you don’t want to trust everything to a single broker, but multiple small accounts at different places is pretty wasteful.

And for those who use multiple credit cards, get rid of all but 2 or 3 if you are worried about your credit score.

If you don’t care about that, then close all but one to make things easier on yourself.

One thing you should always have separate is a “cash stash”, especially as part of an emergency preparedness plan.

Organizing Financial Documents

Caucasian woman sitting on a leather couch managing money by sorting through many financial documents
One of the benefits of modernizing how you manage money is that you can find all of your financial documents at the touch of a button and don’t have to worry about paper cuts!

If you really want to get crazily organized, sign up for electronic statements and confirmations.

It may be hard for some people to let go of paper statements, but managing money is much easier when you don’t have all that paper.

This way you only get an email whenever a document is issued, and have no papers to have piled up in all areas of your home.

You can create a hierarchy of folders and save all of the PDFs for easy access when the time comes and it is much easier and quicker than fumbling with papers.

Also, get yourself an account with any one of the cloud storage apps.

That way, you will have access to your documents no matter where you are and you can share the documents easily.

2. Modern Methods Of Managing Money

Closeup of a Black man's hand managing money by counting various denominations of dollar bills into piles on the wooden table
You won’t be as successful at managing money if you have so many pots (ie: accounts), that you don’t even know how much is in each or where they all are.

Almost everyone has a computer these days, so why not take advantage of this amazingly useful tool?

Set yourself up with whatever personal finance management app you like.

These programs are very powerful money management tools that can help with:

  • Tracking the movement of your money
  • Maintaining budgets
  • Generating reports
  • Automating the checkbook balancing process (and there are plenty of people who need help with that task).

You can not only automatically download transactions, which will alleviate much of the stress involved in managing finances, but you can even scan receipts and attach them to transactions, keeping everything in one place.

A lot of people use Excel as a means to track and reconcile accounts, but if you don’t have advanced knowledge of the program, you really will not get the most benefit from it.

And, needless to say, if you are still using paper and a pencil, then you really have your work cut out for you.

Computer-based programs take much of the hassle out of recording, reconciling, tracking, and reporting.

In addition, you can also schedule recurring bills and/or deposits to be automatically entered into the registers so that even without updating your accounts, you will have a more accurate view of the balances.

And, when it comes to managing money, accuracy is important!

It may cost a little bit of money depending on which option you decide to go with, but the time savings will more than make up for the cash expenditure.

3. Make A Commitment To Managing Money

A calendar page with green translucent pushpins used to plan time for managing finances regularly
It’s hard to start a new routine, especially for managing money so it’s important to schedule time in advance in order to get into the flow

In the beginning, getting your programs populated and caught up may take a little bit of time and work.

But, once you are up to speed, you should definitely set a schedule for sitting down and maintaining your records.

Every day would be the most ideal but, obviously, that may not be very convenient.

You should try to set aside a little time on a weekly basis at the very least.

Choose a time when you know that you generally have nothing else going on so that you can commit to that time period regularly–like instead of watching Jeopardy.

After a few times, you will start getting used to that routine and it will become almost second nature.

Try not to miss any of those scheduled times so you are always up-to-date, and watch all of your finances fall right into place.

Like with most things in life, consistency is the key!

Managing Money As A Family Affair

Get other family members involved.

Don’t leave one spouse “in charge” of managing finances.

You both should know where you stand and be on the same page.

If you have kids, let them set up their own files so they can learn the importance of keeping tabs on where the money comes from and where it goes.

Or have them sit with you and let them see what you do to manage your money so they see it first-hand.

Nothing will help a child become financially responsible like learning the value of money and how to manage it from a young age.

It may also teach them to keep things orderly in other areas of life, so maybe you won’t have to continually tell them to clean up their room(s) hahaha!

Wrapping Up

There you go, 3 simple steps to getting more organized financially.

If you need yet another reason to get organized, it also can help protect you against becoming a victim of identity theft.

That alone should give you the kick in the pants to get organized!

Following this guide will help you in having a better understanding of your personal financial picture, and may even help you sleep at night knowing that everything is in its place.

And you can spend less time worrying about being in disarray and concentrating on other, hopefully, more enjoyable pursuits.

Your Turn

How good or bad are you at managing money? How (dis)organized are your finances? What tips do you have for others that could help them get organized financially?


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