Financial Organization in 3 Quick Steps

By Noah Henry  •  April 15, 2014

Some say the key to financial responsibility lies in keeping an eye on every penny you spend and every penny you save. While this may work, it just sounds exhausting beyond words. The goal shouldn’t be to obsess to the point of making it a full-time job, it should be to make the practice as simplified as possible, to organize effectively to keep a perfect grasp on your financial footing without letting it take over your life.

How does one improve financial organization? After trial and error, research and study, I’ve come to the conclusion it involves only a mere three steps.


Financial Organization 101

Use a tracking system. In the good old days, we used to keep our financial records in manila folders (many still do). This filing system is natural and effective, but it’s given way to more efficient financial software which everyone should use to their benefit. Having a reliable tracking system is the first step. I use Manilla personally, because it also lets me manage my subscriptions, loyalty programs and healthcare accounts in addition to my budget. And it’s free. You can keep an eye on every penny you spend and every penny you save with financial management tools such as Manilla, and it doesn’t take incessant mental juggling to do so.

Consolidate your finances into one online account. We know—it’s tempting to use a few banks instead of one; when there’s one bank that offers low fees, one bank that offers high interest, and one bank that offers cash back, it’s easy to want to take advantage of these perks. However, it might benefit you in the long run to amalgamate your focus into one. The mental energy you waste to keep tabs on more than one is taxing, and in regards to organization, it’s better to keep an easy-to-access panoramic snapshot of your finances in one location. It’s easier to pay your bills, wastes less time, and provides you a clearer picture of everything.

Set up automatic investment plan. Some people fear investing because of the risk or unfamiliarity of it. Automatic investment takes away the emotion, therefore making it easier to detach yourself from the commitment of saving money. A Roth IRA—a saver’s best friend—is the best place to start an automatic investment plan, especially as a young person. Unlike Traditional IRAs or 401(k) accounts, there are absolutely no penalties involved in making a withdrawal. Your contributions and interest earnings are tax free, and after retirement your withdrawals are tax free as well. In 20 or 30 years, the accumulated compound returns will net you serious earnings.

These are only the basics of financial organization. As your situation becomes increasingly complex—through age or investments—you may have to rely on other forms of organization. These tips, however, should remain the bedrock of your management system.

Noah Henry Noah Henry Noah Henry is an amateur movie critic, foodie, bowler, and beer reviewer. But he's no amateur when it comes to saving money, so listen up!

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