What You Can Learn About Organizing Your Finances From the Home Edit

The popularity of The Home Edit Netflix show has proven that there is something widely appealing about getting organized. When we’re organized, we feel like we’re in control and we have a system that sets us up for success rather than holding us back. It’s no wonder that we want our finances to feel like that too. Although there are some major differences between organizing physical items and organizing our finances, there is also a lot we can learn from following these organizing gurus’ four-step process.

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Every good organizer starts with getting rid of items that are no longer needed. The items you keep need to fit within the space you have. The same applies to your finances. What expenses do you have that are no longer serving you? Maybe it’s a membership for the gym you never visit or a monthly pest control service you’ve been paying for but never had to call. Getting rid of expenses you no longer need frees up more money to spend on what you care about.

Categorize

The next step in organizing a physical space is to categorize by grouping similar items together. This makes it easier to find what you’re looking for and to understand how much space each category takes up, which can help you see if you have an overabundance of something. When organizing your finances, you gain a lot of clarity about your finances by categorizing your expenses. How much are your fixed monthly bills versus your day-to-day expenses? How much do you spend on groceries, dining out, personal care, etc.? What portion of your expenses are discretionary versus necessary? Which expenses do you have the ability to change and which are out of your control?

Contain

Containing physical items means giving everything its own place. The items you keep need to fit in each container you’ve designated for them. If they start to overflow your container, you’ve got a problem and you need to get rid of something else. The same concept applies to your budget. By “containing” your expenses (i.e. planning for them in your budget), you keep space for what is most important: saving for your goals! If an expense doesn’t fit, you need to make compromises elsewhere. 

Maintain

Once you’ve gone through the work of organizing, you need to maintain it! With physical items, this means returning items to their home and respecting the limits of your containers. For your finances, it means regularly reviewing your expenses to get rid of anything you’re paying for but not using and tracking your day-to-day expenses to know whether you are going over budget. By maintaining, you prevent the need for another big overhaul.

Bonus: Make it Pretty

While the main point of organizing is to make your space (or finances) functional, not decorative, you’ll get added enjoyment out of making whatever you’re organizing visually appealing. You’ll also be more likely to maintain it. Find an expense tracking app that you like the look of, create a vision board savings tracker for a goal you’re saving for, or add some color to the budget spreadsheet you’re using—whatever sparks that fuzzy feeling when you look at it.

Ready to organize your finances? 

To get started, schedule a free 20-minute consultation call to speak to a member of our team. We will ask you a few basic questions to get to know you more, walk you through our financial training program steps, and answer any questions you may have. No pressure to join! Need advice quickly? Talk to one of our Trainers on Demand.