March 15th, 2010
Cleaning up your finances doesn’t have to be a big chore; you can do it while catching up on your DVR one evening. Not only will you put a better system into place to reduce clutter, you will also re-connect with your money and hopefully begin taking control of it.
Start by getting organized. Gather all your documents in front of you β grab your files, empty that basket, pull out your bills and round up your receipts. Next sort them into the following piles:
ο Receipts, paycheck stubs, bank and credit card statements and monthly bills
ο Investment statements (401k, brokerage, IRA, etc.)
ο Tax returns and the documents used to prepare them
ο Insurance policies, ownership deeds, etc.
ο Warranties, user manuals and their corresponding receipts
ο Identification documents
Next, place your identification documents (also called “forever docs”) in a fire-proof safe in your home. This includes birth certificates, passports, marriage license, divorce decree, will, trust, power of attorney, death certificates and other original documents. For all of the other piles, create a folder for each and add new papers as you receive them.
Some folders will then have folders within them. For example, in your folder for monthly bills, you might have a separate folder for electric, cable, credit card statements and so on. If you can, keep these files in a fire- and water-resistant safe. If that is not possible, at least keep them together in a drawer or on a shelf.
Then let the de-cluttering begin. Read on for guidelines on how long to keep what type of documents.
RECEIPTS, PAY STUBS AND MONTHLY ONGOING BILLS
Utility bills: Keep for one year, unless you claim a home office deduction, in which case they become tax documents.
Pay stubs: Keep for one year until you receive your W-2. As long as your last paycheck matches your W-2, you can toss them.
Bank and credit card statements: Keep for two years, as you may need them when applying for a mortgage or other loan.
INVESTMENT STATEMENTS
Keep your monthly or quarterly statements until you receive your annual. If you make any trades, keep the trade confirmation for a purchase as long as you hold the asset and for a sale, for at least three years. If you make any non-deductible contributions to your traditional IRA or convert to a Roth IRA, save the IRS Form 8606 until you withdraw during retirement as proof that you’ve already paid the taxes.
TAX RETURNS AND SUPPORTING DOCS
Keep everything for at least three years. For questions on IRS recordkeeping guidelines, check out IRS Publication 552.
INSURANCE POLICIES, OWNERSHIP DEEDS, ETC.
Keep all as long as the policy is in effect or as long as you own your home or car. Consider placing this file in your fireproof safe as well.
WARRANTIES AND USER MANUALS
Save all active warranties. Toss any that have expired or for items you no longer own. Try to weed this file out on an annual basis. I like to staple the receipt showing proof of purchase to the warranty in case I need it. If you are comfortable using the Web, I recommend tossing user manuals. Manufacturers now have downloadable versions on their Web sites, so you can rid yourself of this clutter.
As far as ATM receipts and other receipts for purchases, you can toss these after you’ve checked them against your bank statement. I keep receipts for clothing until I’ve worn and washed the item and for household items until it has been used at least once, unless it has a warranty.
As you are de-cluttering and tossing unneeded documents, be sure you shred them before putting them in your recycle bin. Even if it is a statement for an account that is closed, you don’t want to tempt identity thieves by offering your name, address and an account number on one page.
Finally, once you have your important papers more organized and up-to-date, make a note to revisit your files on an annual basis to weed out those no longer needed and collect and add any new documents collected.
A version of this post was published in the Cincy Chic column “Cents & Sensibility” on March 15, 2010.
Tags: Cincy Chic, finances, financial education, financial planning, financial security, Women and money
Posted in Cincy Chic columns, Financial commentary, Women and money | No Comments »
March 1st, 2010
When planning your dream wedding it is easy to ring up an event costing more than $30,000 — that’s more than the price of a decent new car! As each little thing adds up, it is important to save money in areas where it won’t really affect the overall day. Try one or all of these ideas to save some coin without sacrificing the ultimate intent: exchanging vows with your beloved!
Minimize the Menu If you’re hosting a large reception (over 150 guests), the cost of food can exceed $10,000 if you choose a premium main course. In my opinion, you don’t need to serve a gourmet meal — chicken and veggies are just fine.
Most wedding guests aren’t coming to your reception for the food anyway. In general they will expect a decent meal, but won’t be disappointed if they are not served a filet or lobster. And if you hire a fun deejay, (one area where you can get a lot of bang for your buck) most people won’t even pay attention to what they’re eating because they’ll be so anxious to get out on the dance floor.
Save money on the food and spend it on great meals on the honeymoon that you will savor and remember.
Lower the Bar Bill Don’t let your party animal friends talk you into hosting a top shelf open bar. While some wedding guests may prefer a mixed drink before dinner, most will be fine with choosing beer or wine as their drink of choice for the night. Trim a dollar or two off the cost of EACH GUEST by choosing to serve only beer and wine at your bar and you’ll save hundreds of dollars on the reception. If you’d still like to make mixed drinks available, guests will understand if you choose to have a cash bar for those options.
You may also choose to offer an open bar for the first three hours of the event, turning it into a cash bar later in the night to discourage guests from overindulging. This is safe for your budget and your guests’ health.
Have Your Cake It is worth the money to have a professional bake your wedding cake. Ask any caterer and he or she will have a story of an amateur wedding cake gone awry. To have a beautiful cake without breaking the budget, ask your baker to make your decorated cake smaller, then bring a couple extra sheet cakes or “kitchen cakes” to keep in the back to give you enough to serve all your guests.
Event center staff are used to this arrangement, and your guests will still enjoy a tasty cake while never knowing that the piece they savor didn’t come from the actual cake you cut.
Above all, don’t lose sight of why you are planning such a celebration. A wedding is one of life’s great milestones for many and loads of fun to plan and execute. Just remember that at the end of the day, the only purpose is to unite your life and your heart with that of your soul mate’s. As long as you make that happen, none of the other details will really matter in the long run.
These tips are just a sampling of the many I have collected over the years. My newsletter, Weekly Wedding Wisdom, offers several other money-friendly ideas related to getting married. If you’d like more, please Email me to be added to the list. Your email address will not be used for any other purpose.
A version of this post was published in the Cincy Chic column “Cents & Sensibility” on March 1, 2010.
Tags: Cincy Chic, financial coach, financial planning, marriage and money, Newlyweds, wedding planning
Posted in Cincy Chic columns, Money-saving tips, Newlyweds, financial planning | No Comments »
Spring Cleaning Your Finances
March 15th, 2010Cleaning up your finances doesn’t have to be a big chore; you can do it while catching up on your DVR one evening. Not only will you put a better system into place to reduce clutter, you will also re-connect with your money and hopefully begin taking control of it.
Start by getting organized. Gather all your documents in front of you β grab your files, empty that basket, pull out your bills and round up your receipts. Next sort them into the following piles:
ο Receipts, paycheck stubs, bank and credit card statements and monthly bills
ο Investment statements (401k, brokerage, IRA, etc.)
ο Tax returns and the documents used to prepare them
ο Insurance policies, ownership deeds, etc.
ο Warranties, user manuals and their corresponding receipts
ο Identification documents
Next, place your identification documents (also called “forever docs”) in a fire-proof safe in your home. This includes birth certificates, passports, marriage license, divorce decree, will, trust, power of attorney, death certificates and other original documents. For all of the other piles, create a folder for each and add new papers as you receive them.
Some folders will then have folders within them. For example, in your folder for monthly bills, you might have a separate folder for electric, cable, credit card statements and so on. If you can, keep these files in a fire- and water-resistant safe. If that is not possible, at least keep them together in a drawer or on a shelf.
Then let the de-cluttering begin. Read on for guidelines on how long to keep what type of documents.
RECEIPTS, PAY STUBS AND MONTHLY ONGOING BILLS
Utility bills: Keep for one year, unless you claim a home office deduction, in which case they become tax documents.
Pay stubs: Keep for one year until you receive your W-2. As long as your last paycheck matches your W-2, you can toss them.
Bank and credit card statements: Keep for two years, as you may need them when applying for a mortgage or other loan.
INVESTMENT STATEMENTS
Keep your monthly or quarterly statements until you receive your annual. If you make any trades, keep the trade confirmation for a purchase as long as you hold the asset and for a sale, for at least three years. If you make any non-deductible contributions to your traditional IRA or convert to a Roth IRA, save the IRS Form 8606 until you withdraw during retirement as proof that you’ve already paid the taxes.
TAX RETURNS AND SUPPORTING DOCS
Keep everything for at least three years. For questions on IRS recordkeeping guidelines, check out IRS Publication 552.
INSURANCE POLICIES, OWNERSHIP DEEDS, ETC.
Keep all as long as the policy is in effect or as long as you own your home or car. Consider placing this file in your fireproof safe as well.
WARRANTIES AND USER MANUALS
Save all active warranties. Toss any that have expired or for items you no longer own. Try to weed this file out on an annual basis. I like to staple the receipt showing proof of purchase to the warranty in case I need it. If you are comfortable using the Web, I recommend tossing user manuals. Manufacturers now have downloadable versions on their Web sites, so you can rid yourself of this clutter.
As far as ATM receipts and other receipts for purchases, you can toss these after you’ve checked them against your bank statement. I keep receipts for clothing until I’ve worn and washed the item and for household items until it has been used at least once, unless it has a warranty.
As you are de-cluttering and tossing unneeded documents, be sure you shred them before putting them in your recycle bin. Even if it is a statement for an account that is closed, you don’t want to tempt identity thieves by offering your name, address and an account number on one page.
Finally, once you have your important papers more organized and up-to-date, make a note to revisit your files on an annual basis to weed out those no longer needed and collect and add any new documents collected.
A version of this post was published in the Cincy Chic column “Cents & Sensibility” on March 15, 2010.
Tags: Cincy Chic, finances, financial education, financial planning, financial security, Women and money
Posted in Cincy Chic columns, Financial commentary, Women and money | No Comments »