This post was created in partnership with the GM BuyPower Card®. Opinions are my own and do not reflect the views of General Motors or Capital One.
If you are stressed about your money, chances are that you are also financially unorganized, whether you regularly fail to stick to a budget (or maybe you don’t have a budget? You’re not alone!), don’t reach your saving or investing goals, or your debt and credit scores are a mess.
In fact, a deep clean of your finances can do a couple, critical things:
- Face the facts. No more ignoring what has made you uncomfortable.
- Save time and energy.
Even simple things like figuring out what’s the best credit card for your lifestyle (hint, hint: car buyers might want to check out the GM BuyPower Card* can change your financial picture drastically.
Open all your bills and aggregate
If you’re not clear on your money situation, chances are you’re avoiding it.
This may include failing to open bills, ignoring due dates, missing payments and looking the other way, or humming and tapping your foot when friends bring up investing.
First things first: Get real with yourself. This means opening all your bills as they arrive. No ignoring them. This is adulthood!
Second, plug all your accounts into a third-party app. There are plenty of options that are free and have a great app and desktop experience to give you a snapshot of your income, debts, checking, saving and set budgets.
The point is to get a single, clear picture of all your money, in one spot.
Consolidate your credit cards
I used to have several credit cards: A personal card, business card and two store brand cards.
I kept them all in my wallet, they all had different due dates, and different points programs, and it was confusing.
Finally, last year I decided to streamline my finances and narrowed my credit cards down to one business card and one store card. They both have good points programs, and since I don’t carry a balance, the interest rate is irrelevant.
What is relevant is that I have two cards, and no more. If you don’t own a business, it’s worth thinking about cutting the number of cards in your wallet down to just one. After all, the less you have to manage, the easier it is to be empowered in your finances.
It is important to choose a card that aligns with your goals. For example, if you’re thinking about buying or leasing a new car in the next few years, the GM BuyPower Card may be worth considering.
This rewards credit card is a great tool that provides a simple way to build Earnings toward a new vehicle by allowing Cardmembers to accumulate 5% Earnings on the first $5,000 spent on purchases every year, and then 2% unlimited Earnings on purchases from there.
Just by making your regular, everyday purchases. And all toward the purchase or lease of a new Chevrolet, Buick, Cadillac, or GMC vehicle. There is nothing to manage, and just reap the rewards when the time comes.
Set one due date and automate
In 2018, there is no reason to write paper checks to pay your bills. Perhaps your landlord requires this ancient form of currency, or your kid’s daycare, in which case there is not much you can do.
For everything else, go online or call the utility, insurer, bank or service and set up automatic payment. Many places will give you a buck or two discount each month for making your own life easier!
The next step is to set the due date for as many bills as possible to the first of the month. Perhaps your cash flow does not allow for all your bills to clear at once, but that means that you are spending a lot of mental energy and stress worrying that paychecks will clear before bills hit.
The goal is to make money simple, and low-stress. In this case, make it a goal to maintain enough cash in your checking account (or accounts) to comfortably afford regular monthly expenses to be cleared on a single date each month.
Two goals at a time
There’s a lot of great advice and tools on the market for how to create and maintain budgets. Lots of people set up fantastic goals with great, realistic systems for reaching them — but within a month or two, have slid right back into their old ways of willy-nilly spending and the guilt and shame that goes along with it.
One of the big challenges is that when you are ready to make major changes to your finances, your enthusiasm can lead you astray and you create numerous goals: Create the emergency fund and pay off your credit card debt and save for vacation and get up-to-speed on your retirement goals.
Instead, start with a maximum of two goals. In fact, one goal is even better! The two goals should complement each other: Add to your investments and pay off your credit card. Or, one long-term savings goal (like retirement) and one short-term goal (like saving for a home remodel).
The fewer the goals, the higher the chance of staying on track and reaching them!
*Capital One, N.A. is the issuer of the BuyPower Card. General Motors is responsible for the operation and administration of the Earnings Program.
Emma Johnson is a veteran money journalist, noted blogger, bestselling author and an host of the award-winning podcast, Like a Mother with Emma Johnson. A former Associated Press Financial Wire reporter and MSN Money columnist, Emma has written for the New York Times, Wall Street Journal, Forbes, Glamour, Oprah.com, U.S. News, Parenting, USA Today and others. Her #1 bestseller, The Kickass Single Mom (Penguin), was named to the New York Post’s ‘Must Read” list.
Emma regularly comments on issues of modern families, gender equality, divorce, sex and motherhood for outlets like CNN, Headline News, New York Times, Wall Street Journal, Fox & Friends, CNBC, NPR, TIME, MONEY, O, The Oprah Magazine and The Doctors. She was named Parents magazine’s “Best of the Web,” “Top 15 Personal Finance Podcasts” by U.S. News, and a “Most Eligible New Yorker” by New York Observer.
A popular speaker, Emma presented at the United Nations Summit for Gender Equality. Read more about Emma here.