Spring Cleaning for your Budget

Every year when April rolls around with its longer days, hints of future summer warmth, and freshly blooming flowers I feel the urge to refresh and renew. Spring cleaning often elicits thoughts of mopping, dusting and addressing all of the things that we’ve been shoving into that one closet throughout the year. This season, I challenge you to spend a few hours cleaning your budget, too.

Money is a tool to facilitate a life well lived, to provide flexibility and opportunity, as well as security. We should be thoughtful about our spending, but much like our homes, it’s easy for clutter to build up. When we’re already caught up in the fast pace of daily life, it is easy to lose sight of where it is all going.

Before arming yourself with a broom and trash bags, sit down at your computer and let’s look through our spending habits. Open multiple tabs in your web browser, log into each of your financial accounts, and review your transactions over the last 12 months.

Clean out unused subscription services

Subscription services are the cobwebs of financial world. There is a reason companies offer free 30-day subscriptions. We all sign up for them, promise ourselves we’ll remember to cancel them before the 30 days is up, and then we never do. If we don’t keep a vigilant eye on our expenditures, it’s easy to miss. It’s a wonderful tool for companies, but bad for our wallets. Review the last 30 days of transactions on all of your accounts and my guess is there is at least one, if not multiple, subscriptions that are no longer in use and can be cancelled immediately.

Search for hidden fees and rising costs

Keep an eye out for increased fees and one-time charges. Credit card annual fees, service activation fees, overdraft fees or low balance fees are all common costs that seem minimal but can add up over time. Perhaps a promotional rate on your internet service expired and suddenly that monthly bill jumps. You might even be paying for a service you didn’t know you had. It is time to investigate.

Companies spend more money acquiring a new customer than retaining an old one, and we can use this to our advantage. Simply asking, “can you please remove this annual charge from my statement?” is surprisingly effective. Companies often empower employees to do small bill adjustments to keep customers happy. Play your cards right and a 30-minute call might save you over $100.

Set up or review your automatic savings

After working through your budget to free up some monthly income, don’t just let it sit there! Increase monthly contributions to your retirement account by that $14.99/month service you decided to disconnect. Put an extra $100 into your savings after having your credit card fee waived for the year and build the habit of prioritizing your future financial health.

Just as a clean house creates a space for physical peace, a clean budget creates a space for mental peace. And while the task of cleaning it may seem daunting, our future selves (and bank balances) will thank us.