How We Organize Our Finances

Here’s a quick rundown of how we organize our finances and our financial documents –

Extremely Important Documents –

We keep our tax returns, marriage license, birth certificates, car titles, etc. in a fire-proof safe.  I have friends who keep such documents off-site in a safety-deposit box.  The fire-proof safe works for us.  I also have electronic copies stored on a removable hard drive.

Important Documents –

We keep cleared checks, bank statements, and other important documents under lock-and-key in a filing cabinet.  I have an accordion-style file folder for each year’s documents.  When a new year begins, I simply store the previous year’s folder in the filing cabinet and start a new folder.  Bills, checks, bank statements, etc. are filed alphabetically.

Electronic Documents –

For bills or other documents that I receive electronically, I keep a few in a folder on my computer’s hard drive, and store back ups on a removable USB hard drive.

Online Accounts –

In my browser, I have created a bookmarks folder labeled financial accounts.  I have links to all of my financial accounts saved in the financial accounts folder.  When I want to pay a bill online or take a look at my retirement account, I simply select the financial accounts folder, and click open all in tabs.  I then have access to all of my accounts.  I can log in to as many accounts as I need.

Inventory of Accounts –

I have a list of all of our financial accounts (places where we have money saved).  I have a printed copy and I have a copy on my hard drive.  Click here to view and download a blank copy of the inventory of accounts that I use.  I update this inventory once per quarter.  If you use this inventory, be sure to store it in a place where you (and your spouse) and only you (and your spouse) can access it.

Budget –

I use a the very simple, easy to use You Need A Budget software to manage our household budget.  Click here to read about the zero-based budget method that we use.  (YNAB is a long-time sponsor of No Credit Needed.  I’m more than proud to promote their products and I use their pro version every day.)  It usually takes me less than 30 minutes to create our budget, and less than 10 minutes per week to actually “manage” our finances.

Cash –

I do not like credit cards, and there are times when I do not feel like using my debit card.  I am a big fan of the cash management system known as the envelope system.  Click here to view a short video where I explain how the envelope system works for me.

The Process –

At the beginning of each month, I’ll sit down and create a monthly budget.  My wife will look it over, and we’ll make any changes that she suggests.  My wife gets paid at the end of the month, so on the 1st or 2nd of each month, I’ll deposit her check in our local bank.  Any monthly bills are immediately paid, via online bill pay.  Cash is “deposited” in our envelopes.  Any paper bill stubs that we might have are filed away in the accordion-style file folder.

Two weeks into the month, I receive my paycheck.  I deposit it in the local bank and then transfer any money allocated for savings to our ING Direct savings account.

As I receive bills throughout the month, I place them on a little table in our kitchen.  One week before the end of the month, I’ll open them, make plans to pay them, and file any that need to be filed.

My goal –

My goal is to keep my life (and my mind) as uncluttered as is possible.  I like for things to be “just so”.  Before I began to reduce my debt and work on my finances, I was extremely disorganized.  Having learned my lesson (a hundred times over), I know strive to be very organized.  I want to be able to spend my time on the more important things (people) in my life.  So, I have put a lot of work in to creating some systems that work for me.  Hopefully, you’ll find some systems that will work for you.