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If you are like many Canadians, you probably have a stack of credit card statements that need addressed. There are benefits to addressing those statements and organizing them so that you can refer back to them whenever needed, especially if a dispute comes about.
A lot of time, money, and energy are expended when you are not able to stay on top of your monthly bills. When your credit cards are cluttered, bills can get lost, late payments are more likely to happen, and your credit score could experience some negative hits.
If this sounds like you, it is possible to get organized. Even if the situation seems hopeless, it is far from it. There are things that you can do to help your financial situation that you may not be aware of.
Basically what happens is individuals tend to flounder among all of the paperwork. This causes them to lose money every month. On top of that, they then spend more without knowing how much they really owe. This is why it is good to take advice from professional organizers who know how to spring clean all of the financial clutter, as well as keep it organized for the rest of the year.
Look At Every Statement
It is best to ensure that statements don't pile up. Ignoring credit card statements can have a negative impact, especially if there are several cards nearing their credit limits. The best thing that you can do is open every statement that is received through the mail. You can then make a list of the credit cards and their balances with their interest rates.
After you have made your list, the next thing you can do is create a budget that is based on necessary spending and focused on eliminating one credit card at a time. While cardholders are frequently advised to work on the highest interest account first, others say it can be best to pay off the smallest balances first. That way there are fewer card payments to focus on sooner in the organizational game.
Create An Organizational System
Most professional financial organizers will agree that a filing system that is well-designed is an effective tool for dealing with credit card debt. This system should have a specific place in the home or office for receipts with a second place for the statements that correspond with those receipts. It is recommended that receipts and statements be organized in separate folders. The simpler a person makes their system, the more likely they are to maintain it.
Consumers schedule an average of 30 to 60 minutes each week to make sure their bills are paid on time. It is ideal to schedule at least one point during the week to manage finances because that will allow the urgent bills to be dealt with. The bills that need to be paid as soon as possible need to have a designated place. Once paid, the statement needs to be moved to its file folder.
When starting a new year, it is suggested that organized statements need to be placed into envelopes that have the year marked on the outside so they do not get confused with the previous year. It is also ideal to have a file for each credit card and there should be an inactive area. At the end of the fiscal year, the paid bills need to be transferred over to the inactive file. Banker's boxes work best for storing away annual documents. You can consult with your tax professional about how long you should maintain these records.
Ongoing Transaction Slips
When you shop, keep your credit card receipts. They may not seem important, but they really are. Designate a place in your wallet or purse for these receipts and, at the end of the day, sort them into piles. If a transaction was a personal one, then put it in a personal expense pile. For those transactions that were business transactions, place them in a business pile. You can then move them to file folders. If any of the items that you purchased has a warranty, then you should staple the receipt to the inside of the owner's manual and place it in a file. For grocery store transactions and other immediate-use purchases, you can place them in a separate file so you can reconcile them against your credit card's monthly statement.
Organizing Electronic Clutter
Electronic clutter qualifies as financial clutter. You may want to start receiving credit card statements electronically so that you have less paper to deal with. You can ask your bank to set up your bank account to automatically pay your credit card bills before their due dates. You can also have other bills paid electronically. Nonetheless, you will need to take the time to file your electronic bills. This means creating individual folders in your email account that you place your bills in. You can also set up a folder for payment confirmations so that you have the receipts.
It can be tempting to let electronic clutter go, but it does need to be organized. Even though your email has a search function on it that helps you find specific emails, you still need to sort. The reason why you still need to sort out your electronic bills is so you can keep track of everything. You will have a good understanding of what is in your email. Furthermore, organizing online statements and receipts will allow you to not have to do searches when you need to reconcile those receipts against your statements.
Whether there are any disputes or not as to the validity of a charge or the dollar amount of a bill, it is important to organize. By organizing, you can always ensure accuracy and you can keep yourself from spending more on your bills than you have to.
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