Springtime has finally arrived! As you start to enjoy the long, warmer days and put aside a day for spring cleaning, make sure that you give your finances a spring cleaning as well!
Start by addressing those dusty old boxes or files full of well-aged financial documents that you no longer need. It’s finally time to throw out those yellowed cancelled checks, decade-old credit card and bank statements and former apartment leases with addresses that you can barely still remember. Holding on to tax returns from 2002 or earlier? It’s generally safe to get rid of your old returns and associated records if they are at least seven years old. Make sure that you shred sensitive documents to protect yourself from identity theft! (For a clear and simple guide on how long you need to retain financial documents download our free guide on What to Keep and What to Shred.)
If you rent a safe deposit box that you have not visited in a while, this is a great time to swing by your bank to make an annual inventory of its contents. Original titles, deeds and negotiable securities (i.e., older bond certificates) are best kept here. Store your original will in the box, but make sure that you have a copy at home as well. However, keep only copies of government-issued IDs and insurance policies in the vault. Make sure that an inventory of the box’s contents, as well as the keys, are in a place where your family could find them in case of an emergency. Put with it an emergency contact list for financial issues, which may include names and phone numbers for your insurance agents, estate planning attorney and investment manager.
Next, it’s finally time to track down any stray investment and bank accounts. I recently checked-in on a long-forgotten savings account and was excited to discover $200 sitting in it. However, I was shocked to discover that the bank had started charging a $5 fee each month, which far out-paced the meager 1% interest I was earning, so I immediately closed the account. If you have changed jobs in the past few years, you may still have retirement accounts sitting in your previous employer’s plan, so take the time to transfer these funds to a retirement account that you can more actively monitor and manage.
Moving on to more fun tasks, gather up any gift cards that have been taped to refrigerator since last Christmas (or the Christmas before that) and put them to use! Spending them on something for yourself is the easiest solution, but if you are never going to use that $25 gift card to the Mitten Hut from Grandma then donate it, re-gift it, or sell it on eBay or to a gift card reseller like Plastic Jungle.
Finally, incorporate a financial aspect to clearing clutter out of your home, too. Dedicate the funds you’ll earn from a garage sale to a fun activity like a night on the town or a day at the ballpark. It makes it easier to part ways with your long un-used snowboard and will help to keep you motivated as you clean out your house in celebration of springtime!
