8 Steps to Spring Clean Your Budget

Spring is in the air! If you’re anything like me, that means decluttering, tidying, washing, and… spring cleaning your budget!

Spring is the perfect time to organize your finances and get back on track with your financial goals. While typically 80% of new years resolutions are forgotten by February, it’s never too late to start working on your financial goals.

After all, it’s a new season, new quarter, and a chance for new opportunities.

Organize your financial documents

It's important to keep all of your financial paperwork in one secure place so that you can reference it when needed. This includes loan information, bank statements, insurance documents, leases, mortgage information, etc.

Update your net worth

Your net worth is the dollar amount of your assets minus all of your debts (assets - debts = net worth)

Knowing your net worth allows you to understand where you stand financially, identify areas that you might be overspending, and help you make a plan for paying off debt.

While it can be a little scary to calculate your net worth for the very first time, it's so rewarding watching the number creep up year after year!

But, you'll hear me say again and again, you can’t reach your destination without knowing where you’re starting from.

Look at insurance policies

This step is super important, and one that many people put off!

To review your insurance policies, take a look at each type of policy you have (health insurance, life insurance, disability insurance, auto insurance, etc.), the insurance provider, policy number, date the policy was issued and expires, premiums and deductibles, who is insured, beneficiaries, and details of coverage.

Once you've reviewed your insurance policies, you will know if there are any updates you need to make or if you want to shop around for different coverage options.

Review Financial Goals

Remember those financial goals you set at the beginning of the year?

Well, studies show that most people give up on their new years resolutions by the end of February.

If this sounds familiar, then spring is the PERFECT time to jump back into your financial goals for 2021.

Take a couple of minutes to sit down and review your financial goals. You might need to make some adjustments, and that's 100% okay!

When making adjustments to your financial goals, be sure to make them SMART (specific, measurable, attainable, relevant, and time-bound). The more vividly you set your goals, the more likely you are to achieve them!

Track your spending

Now that your documents have all been reviewed and your goals are all set up, it's time to do a spending audit!

Open up your credit and debit card statements and list everything you've spent money on over the last 30 days. Organize these expenses into categories and decide if there are any areas that you would like to modify.

This helps you understand where your money is going and build a strategy that will help you reach your financial goals.

Revamp Your Budget

Once you’ve reviewed your spending for the last 30 days, compare it to your current budget and see if there are any changes that need to be made.

If you feel like your budget isn’t working, then it might be time to start from scratch! Remember that it can take 3-4 months to find a budgeting system that works for you. Keep experimenting and making adjustments until it clicks.

If you’re budgeting with a partner, remember to set aside time each month to talk about your finances and how work together to achieve your goals.

Automate savings & bill payments

Automation is one of the BEST tools to stay on track with your financial goals.

The phrase "out of sight, out of mind" sums it up pretty well! When you automatically send your money to bills and savings goals before you're tempted to spend it, you are so much more likely to stick to your plan.

Declutter and sell old stuff

If you’ve gone on a cleaning and organization frenzy like I do every year, decluttering and selling your old stuff is a great way to make some extra money.

Some of my favorite places to sell things I don’t want anymore are Facebook Marketplace and ThredUp.

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