Spring Clean Your Finances with This Essential Checklist

Man reviewing standing over desk reviewing financial documents

Every spring, countless people throw open their windows, purge the accumulating clutter, and give their homes a deep clean for the year ahead. In the same way, you can refresh, tidy, and prepare your finances to work with you and for you. 

While you’re in cleaning mode this spring, give your money the intensive check-up it deserves. Tackle this 9-step checklist to ensure you’re ready to face the next year with confidence: 

1. Update your budget 

A realistic budget transforms spending from reactive to proactive. It helps you ensure you’re living within your means, paying off debt, saving, and working toward your financial goals. 

If you don’t yet have a budget, get your feet wet with a simple one. From there, add as much detail as you feel comfortable using. 

If you already have a budget, take the time to review it at least once a year. You’ll want to account for recent changes in your life — a new baby, an increase to your rent, or a raise at work. 

Plus, make changes necessary to fit with your current set of financial goals. Maybe you want to start saving for a house, boost your retirement contributions, or eliminate a goal that’s no longer a priority. 

2. Size up your emergency fund 

While you’re updating your budget, use the opportunity to check in with your emergency fund as well: 

  • Did you make a withdrawal during the past year? If so, make a plan to replenish that amount. 

  • Do you want to increase the amount you hold in your emergency fund? Maybe you’d like to boost that buffer a bit. 

  • Do you need to start an emergency fund from scratch? Make a plan to open an account and start saving regularly. 

If you want to increase your emergency fund balance for any reason, be sure to add regular savings to your newly refreshed budget. 

3. Clean up your credit history 

Your credit score impacts your life in more ways than you may realize. So, ensuring your credit history is at its best should be a top financial priority. 

Start by reviewing your three free credit reports and checking in on your score. Examine each report closely, looking for errors or accounts you don’t recognize. If you find an issue, dispute the information with the bureau issuing the report — Equifax, Experian, or TransUnion.  

Then, set up a system to ensure your bills are paid on time. After all, prompt payment is the #1 factor affecting your credit score. You can create regular calendar reminders or set up automatic bill pay with your bank or creditors. 

4. Get ahead of your debt 

With your updated budget in hand and an eye on your credit, turn your attention now to your outstanding debt. How much is it costing you in interest? What would it mean for you to eliminate that debt more rapidly? 

Take a look at your budget. Can you consistently dedicate cash each month toward extra debt repayment — payments beyond the monthly minimums you owe? 

If so, write that amount directly into your budget. Then adopt a proven strategy for wiping out debt as efficiently as possible. 

5. Give your savings a check-up 

Has it been a while since you opened your bank account or chose the investments in your portfolio? Now’s a great time to check in on them and see how they compare to what’s currently available in the financial market. 

Start with your banking or credit union accounts. Are they earning a competitive interest rate? Does it make sense to keep your money where it is or move it to a different bank with better rates, lower fees, or more convenient features? 

Next, review any investments you currently own. Do they still align with your financial goals and your personal risk tolerance? What types of returns and fees come along with each asset? Should you stick with what you have, or is it time to readjust your investment strategy? 

If you need some guidance in these areas, look for a fiduciary financial professional or try out a low-cost robo-advisor

6. Review your retirement contributions 

Retirement is probably the financial goal that comes with the longest time horizon. But planning and saving now are key in reaching that big goal down the road. 

Look over your current contribution rate. Are you saving enough to hit your target retirement date and savings goal? 

Does your employer offer matching contributions? Are you taking full advantage of those to secure as much free money as possible? 

If you find that you want to increase your contributions going forward, consider your options for how you can do that. And make a plan for putting your strategy into action in the year ahead. 

7. Revisit your insurance policies 

As life changes, you’ll likely want to modify your insurance coverages as well. An annual review of your existing policies is a great way to ensure you and your loved ones are protected. 

Pull out all the policies you currently have — home, renter’s, auto, medical, dental, vision, short-term disability, long-term disability, life, long-term care, and more. 

Does each of those coverages still make sense? Are the limits you have in place sufficient, less than what you need, or too much at this point? You may be ready to add additional insurance coverages or switch providers if rates are better elsewhere. 

Identify the steps you need to take to fit your insurance to your current financial needs and get moving on those in the weeks ahead. 

8. Organize your financial documents 

Missing financial records can cause a major headache when you file taxes, apply for a loan, or need to track down some critical information. Having a clear system of organization can help you locate those documents easily and make filing future paperwork a simple task. 

First, identify the records you need to keep. Shred sensitive paperwork that’s not important or has aged out of usefulness. 

Then look over your system. Invest in a simple filing box or cabinet and some folders if you don’t already have them. And sort paperwork in a way that makes sense for your financial life and the way you think. 

Don’t forget to file and back up digital documents as well, so they’re easy to locate when you need them. 

9. Set goals for the year ahead 

With another year behind you, take the time to look back over your recent finances. How did you handle your money? What worked? What didn’t? What do you want to do differently in the year to come? 

Re-examine your financial goals and priorities as well. In what areas do you want to focus? What short-term financial goals are on your plate? And what steps should you take this year toward the long-term goals? 

Write it all down and ensure that your budget aligns with what you want your money to accomplish this year. 

Money is something that impacts our lives on a daily basis. But it pays to take a wide view at least once a year to see where you stand, tidy up your finances, and adjust course as necessary. With a bit of planning each year, you can ensure you’re on track with your money as you head toward a bright financial future. 

The material presented here is for informational purposes only and does not represent specific financial advice to you or your circumstances personally.