by Dana George | Updated July 17, 2021 - First published on Nov. 16, 2019
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If you're intimidated by the idea of preparing for your financial future, don't be. Here's how you can take control in just minutes a day.
Time is valuable, no matter how you look at it. Feeling pulled in several directions sometimes means not finding time for the things you need to do to prepare for the future.
The Ascent looked into how much time people spend on financial planning and found that, on average, Americans spend less than two minutes a day managing their household finances. About 48% of us say we want to be financially prepared for the future, but 97% of us aren't making the time.
If taking control of your financial future feels daunting, you may be overthinking it. We have some simple steps to get you started and then some quick and simple ways to stay on top of it all.
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There is no single recipe for laying a financial foundation, although there are basic steps that will make anyone's life easier. For example, it's worth creating a budget that allows you to quickly see what has been paid and what needs paying. It will also help you to come up with an achievable plan to pay off debt. Set some savings goals so that you know how much you need to put aside for your kids' education, retirement or your next vacation. Work out how much you should be saving each month and if you don't have an emergency fund, factor that into your savings plan too.
You can also simplify your financial life by signing up for automatic deposit if your employer offers it, automating as many payments as possible (including rent, mortgage, and utilities), checking once a year to make sure you're still on the best health plan available, and contributing to your company's retirement plan.
Once you've got your bases covered, you need to put in a bit of time each day and each week to keep things ticking over. Here's a checklist of regular financial housekeeping tasks that will keep your finances under control and allow you to achieve your financial goals.
|Frequency||Financial Housekeeping||Time Needed|
|Every day||Do a quick scan of your checking and savings accounts. Make sure you recognize all the transactions. If you don't, get in touch with your bank as soon as possible to report the problem.||5 minutes|
|As required||Pay bills the day they arrive in your mail or inbox. This ensures everything is paid on time. Remember to mark each bill off your budget as soon as it's paid.||10 minutes|
|Once a week||Look over your written budget. Make sure you've paid everything that was due and that you're not overspending in any categories. Check that you are achieving your savings goals and adapt your spending if necessary.||5 minutes|
|Once a week||Log in to your credit card accounts online, just long enough to make sure you recognize all new charges. If there are any that seem fraudulent, contact your credit card company and report them.||10 minutes|
|Twice a month||Look for places to trim the budget. Have a subscription to BritBox or Openfit you no longer use? Now's the time to drop unused subscriptions. Have you looked into cutting cable and getting your entertainment fix through a streaming service to save money? What about your cell phone bill? If you own your phone outright, you are eligible for low-price "bring your own phone" services offered by some carriers.||15 minutes|
|Twice a month||Review your debt repayment plan to get a sense of where you are in the debt retirement process and if it's time to begin tackling the next debt.||10 minutes|
|Twice a month||Check your investments online. It's a good way to see how compound interest can work on your behalf, right there in black and white.||10 minutes|
As long as you know how much is coming in and going out and are doing the following, you have the majority of bases covered:
After that, it takes minimal effort to keep on top of your finances, and then you can even move on to more detailed planning. But to paraphrase Scarlett O'Hara: You can think about it tomorrow. Today, just focus on staying on top of the little things.
Many people are missing out on guaranteed returns as their money languishes in a big bank savings account earning next to no interest. The Ascent's picks of the best online savings accounts can earn you more than 8x the national average savings account rate.
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