The future is unclear, so now’s a good time to do some financial gardening and get yourself into the best position possible.
I don’t know about you, but when things feel stressful or uncertain, I like to tidy up.
“A cluttered desktop is the sign of a cluttered mind” is a phrase I heard a long time ago, and I’ve always taken it to heart. To organize one’s surroundings is a way of managing one’s internal state. And when things are organized, not only will you feel better, but you’ll also be able to make sense of things more easily.
And there’s a lot out there that doesn’t make sense.
There’s a lot of talk in the news from the incoming administration about reducing government efficiency and waste. This is worrisome, of course, because waste to one person is a lifeline to another. And cutting this “waste” can mean fewer well-paying jobs.
It doesn’t augur well.
Luckily, when it comes to your financial situation, doing some tidying up (or “gardening” as I like to term it) is less likely to have negative consequences. There is almost certainly waste in your finances, and because of that, cutting or reducing it won’t actually be something you’ll miss.
So let’s do some financial gardening and feel better, shall we?
Table of Contents
Prune your bills
The single most effective way to do some financial gardening is to prune your bills.
As a reminder, I define bills as those recurring items on your statement. If you would consider the item a “payment” rather than a “purchase”, it’s a bill.
And these things are proliferating like weeds out there.
Companies have realized that a great way to get recurring, reliable revenue is to sign people up for subscriptions. People will tend to forget about them, leading to charges month after month.
It’s great if you’re a company (or a weed). Not so much for you.
So what I want you to do is go back through the last few months on your bank statement and look at the charges that recur, and for each of them ask yourself if you’re using the service you’re paying for.
Much like how they say that you should get rid of any clothes you haven’t worn in a year, if you haven’t used that service for a while, it’s probably a good idea to cancel it.
Don’t worry, you can always resubscribe.
(For yearly bills, you might need to go back further in your statement to find them.)
Dig out unknowns
While you’re looking at your statement, you might encounter charges that you don’t recognize.
If that’s the case, then you want to dig into those as soon as possible.
Some of these are likely bills that you may have forgotten about, but some might be charges that you didn’t realize you were signing up for, or worse, one’s you didn’t sign up for.
These may be as little as a few dollars a month, but can be much higher, and at any rate, if you don’t know why you’re buying something, you probably want to not buy it.
Here’s a great trick to figure out what an unknown charge is: Copy the whole name of the charge, weird numbers and all, and throw it into Google. You can usually figure out what something is by that alone.
Think about making other changes
When gardening your financial life, some of this involves deciding to make different choices.
Like turning off the news, or taking a timeout from social media, you’re changing a habit that will lead to better things.
So it might be good to ask yourself: what is one thing that you might want to do differently going forward?
Is there something you’re spending money on that doesn’t give you joy, but that you’ve gotten into the habit of doing? What would you not miss if you gave it up?
Notice that I’m not talking about self-restraint or -denial here, only that you take a look at spending that you don’t actually care about. I recommend rooting that out before you even start to think about how you “should make dinner more often rather than getting takeout” or whatever “should do” that comes to mind.
Financial gardening has lots of benefits
Just doing a little bit of this kind of financial gardening can free up unexpectedly large amounts of money. And what can you do with that small monthly windfall? Anything you want. Pay down debts, put away money in savings, or get yourself some Starbucks if it brings you joy.
And more than that, it will give you breathing room. I know things are really stressful right now, and while I can’t do anything about the wider world, I can help you get a little bit more space in your financial life, which can make everything a little easier.
