As we approach the back half of spring, it’s hard not to feel those spring-like vibes. Fresh flowers, fewer rain showers and a new start for bright and sunny things ahead. It’s usually around this time of year we lighten our loads with a bit of spring cleaning, and maybe a few new floral-inspired wardrobe pieces. But spring is also a great opportunity to manage your money without guilt.
Whether you need some help managing money or you just want a bit of a financial tune-up to go with your fresh new, spring outlook, we’ve got 10 of budgeting best practices to consider as we celebrate the season.
Make the time
Unless you’re one of those people who love tracking your finances, odds are taking the time to go over your money will be a chore. But, it’s a necessary one that you can still make fun if you just get a little creative with it. As Pay Day host Lyn Allure reminds us in her “Budgeting 101” video, “Budgeting and finances can be as fun as you make it — so try not to put too much pressure on yourself when creating a budget. Try to make it fun.” Put together some budget-crunching snacks, pour yourself a glass of wine, use a cute notebook or do something else that sets the mood and makes your financial spring cleaning feel more entertaining and like a can’t-miss event.
Evaluate your debt
A general cause of poor money management often has less to do with organizational skills or financial responsibility and more to do with high interest rates. That’s why, when you’re re-evaluating your finances, your debt is always a key place to start. Some debts, like credit card debt, have higher interest rates than, say, a mortgage or a car loan. Take a look at where you’ve accumulated the most debt, gauge how much interest you’re paying and make a plan to pay down those debts first.
Consolidate your accounts
Are your debts just too much to manage? If you own property, you may want to consider working with a mortgage broker to consolidate your debt into one large payment with the lowest possible interest rate. If you don’t own property, you may consider reaching out to a company that specializes in debt consolidation to see if they can help you out.
Check your credit score
While you’re evaluating the interest you’re paying on your various debts, it’s also a good idea to check your credit score to ensure there are no errors or wonky details that may be raising the interest rates you are paying. There’s a common misconception that checking your credit will lower the overall score, but in Canada looking into your own report is considered a “soft” check and should not, in fact, impact it.
Examine your subscriptions
Are you a magazine or newspaper lover with several subscriptions you no longer use? Are you paying for music you don’t listen to? Did you fall for that game ad on Instagram but no longer play it? What about that streaming service you haven’t watched in a few months? Check and evaluate all of your subscriptions to see which ones you’re using and which ones you could ditch in order to save a few extra bucks each month.
Set up paperless billing
If you haven’t yet signed up for paperless billing, why not? Not only is it better for the environment, but it allows you to access all of your information in one easy place. It’s also a practical way to help declutter your home and protect your privacy.
Review your budget
When’s the last time you put together your own personal budget? And if you have one, when is the last time you updated it? When you’re spring cleaning your expenses, it’s always a good idea to see whether your budget is still realistic and whether it tracks. Have you put enough money aside for personal spending? Have any of your bills increased, but still aren’t reflected in your budget? Are you making more money that you could be putting into savings, or could you increase your mortgage payments to help pay down your principal even faster? Take a peek and see if there’s any room for improvement as part of your overall spring cleaning.
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Make use of mobile apps
If you find you have a bit of a spending problem, don’t feel too bad. Many of us are just predisposed as human beings to spend money when we have it. If that problem is becoming unmanageable though, maybe it’s time to track where you’re actually putting that green. There are many personal finance apps out there that help you to track bill payments and break down the areas you spend the most. Because sometimes, seeing just how much money you’re spending on takeout is the nudge you need to start changing your financial habits.
Set up automatic payments
If you need more help managing your money, automatic payments can be your best friend. By ensuring all of your bills (and a predetermined amount of savings) automatically come out at the same time or times each month, you won’t have a chance to spend your money on something else. Think about it: if you get paid biweekly and you set up $50 to automatically go from each paycheque into a savings account, you’ll have an extra $1,300 in hand at the end of the year — and that’s not including any potential interest you may be earning on those savings.
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Work with a financial planner to reach your goals
Whether you’re a top-notch savings expert or someone who could learn a bit more about best budgeting practices, working with an expert financial planner can help elevate your game. These professionals work with you to determine your goals and come up with a plan to achieve them, while also helping you to manage money markets, mutual funds, RRSPs, tax-free savings accounts and RESPs to ensure you’re getting the highest rate of return on your investments possible, while only taking market risks you’re truly comfortable with.