Wouldn’t it be nice to simplify your finances and never have to worry about money? And while you’re at it, wouldn’t it also be nice to cut down on the amount of time you spend managing your finances?
Both questions get a yes from me. Between running a busy freelance writing business and homeschooling my kids and doing all the other mom things, I don’t have a lot of time to spare.
But that doesn’t mean my budget has gone off the rails or I’m drowning in debt. It just means I have to be a little creative about how I manage my money.
One of the ways I’ve done that is by taking a “less is more” approach. I spend less time on my finances these days but I get more results than I ever did when I used to spend hours a day crunching numbers. And as a busy single mom, less money stress and more time is invaluable to me.
Sounds good, right? Learning how to simplify your finances can cut down on money headaches and give you back more of your time, too.
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How to Simplify Your Finances and End Money Stress
According to a recent Varo Money survey, 30% of Americans say they’re constantly stressed about money. 85% of Americans are somewhat stressed about their finances.
I don’t want to be one of the 30% or even the 85% and I don’t want you to be either. ‘Cause ain’t nobody got time for that, especially not when you’re a busy mom.
So I thought I’d share some of the things I’ve done to streamline my money management over the years. These 10 tips are designed to help you simplify your finances so money is one less headache you have to deal with.
1. Automate your bill payments.
Putting your bills on autopilot does a couple of things for you. First, it helps you avoid paying late.
Late payments are a headache because you can get hit with a late fee when you don’t pay on time. Even worse, a late payment to a credit card or loan could end up on your credit report.
Late payments can really hurt your credit score in a big way. A good credit score matters if you need to borrow money and you don’t want to get denied for credit or end up stuck with a higher interest rate.
The other benefit of putting your bills on autopilot is that you don’t have to worry about them. I’ve got most of my bills set up to be paid automatically out of my checking account. All I have to do is make sure I’m depositing money into the account before those bills are due.
Pro tip: Keep a buffer in your checking account. I keep enough in my checking to cover all my bills for one month just in case a client is late paying an invoice or a check gets lost in the mail.
2. Automate your savings.
Saving money is one of my favorite things ever. I get really excited each month when I see the balances in my retirement account and savings account grow.
If you’ve struggled to save in the past, you might just need a little help getting into the habit. That’s where automating can be your best friend.
When deposits to savings are automatic, you know the money you want to save is going to get where it needs to go. You’re a lot less likely to spend the money you planned to save if it’s coming out of your checking account automatically every pay day and going straight into savings.
You can automate your retirement and college savings too. Since I’m self-employed, I don’t have a company 401(k) I can use to save. Instead, I park my retirement savings in a SEP IRA.
I make regular deposits automatically each month to my account, and I bump up my savings with extra deposits every few months through the year. I do the same with the 529 accounts I’m using to save for college for my kids.
The great thing about automating your savings is that even small amounts of money add up over time. If you have to start with a $10 automatic transfer from checking to savings once a week, then so be it. You can work on raising that amount gradually and in the meantime, you’re growing your savings cushion.
3. Track your spending.
It’s hard to simplify your finances when you don’t know what you’re spending. When I was first learning to budget as a single mom, this was something I struggled with big time.
Eventually I realized that if I wanted to get ahead, I needed to track my spending so I wasn’t clueless about where my money was going.
Tracking your spending is important if you want your budget to not be a total failure. A budget is really just a plan for managing your money and it has two sides: the money coming in and the money going out.
When you’re conscious of what’s going out, it’s a lot easier to stay on budget. And you can find potential budget leaks that might be money wasters.
There are a few ways you can track your spending but I think the easiest way to do it is to let an app do it for you.
You link your checking account and credit cards to the app; the app records your spending so you can see at a glance where your money went. Easy peasy and all you have to handle is the initial account set up.
If you need some recommendations for budgeting apps, Rosemarie Groner (aka Busy Budgeter) has a great post to check out.
4. Set up banking alerts.
If you’re not using banking alerts to simplify your finances, you are TOTALLY missing out. Alerts can tell you exactly what’s happening with your money without ever having to log in to your account.
My bank offers several different alert types but the one I use most often is the new transaction alert for my checking account. It’s a simple way to know when scheduled bill payments post, deposits are credited, transfers are completed and new debit transactions hit my account.
You can also set up low balance alerts to let you know if your checking account could use a top up. This one’s really important for avoiding those oh-so-expensive overdraft fees.
If you use a credit card for spending, you can flip flop it and sign up for high balance alerts instead. This way, you know how close you’re getting to your credit limit. You can also set up credit card alerts to let you know every time there’s a new charge on your account.
I have this alert set up for all my credit cards, even the ones I don’t use regularly. This actually paid off last year when someone hacked one of my cards and made a cash advance at an ATM.
The alert hit my inbox two minutes after the transaction was completed and I was able to get in touch with the credit card company and shut the card down before they could do anymore damage. Having these alerts in place means I don’t have to waste time monitoring my account or poring over statements every month.
5. Go paperless.
Before paperless statements came along, I was drowning in paperwork. I had this huge file box that I kept all my paperwork in: bank statements, bills, tax forms, pay stubs — you name it. If it had anything to do with my finances, it went in the box.
I did this for years and eventually accumulated a huge stack of useless paper because I could never decide what to keep and what to throw away. And any time I tried to find something, I had to spend time sorting through it all.
A few years ago, I decided to ditch the paper trail for good and go digital. With the exception of my internet bill and my mortgage statements, I get everything — bank statements, investment statements, bills, tax forms — electronically.
It’s so much easier to check statements or bills online than it ever was to manage that mountain of paperwork. And I feel good about wasting less time and less paper to manage my money.
6. Stick with one bank.
Half of Americans have accounts at more than one bank. I admit, I have more than one savings account but they’re all at the same bank. (I keep an account just to pay my taxes and business expenses that’s separate from my personal accounts.)
If you’ve got checking accounts and savings accounts scattered here, there and everywhere, you could just be making it harder on yourself to stay on top of your money. Moving all your money to just one bank can simplify your finances and the job of keeping tabs on your balances.
If you’re moving all your money to one bank, do your homework first. Look at:
- The kind of accounts the bank offers
- Any fees you’ll pay for checking or savings accounts
- What kind of perks and features you get with your account
- The interest rate you can earn on savings
- ATM locations and how conveniently you’ll be able to get to your money
- Customer service and the bank’s overall reputation
If you don’t have a lot of time to spend comparing banks, I suggest using a site like MyBankTracker to review different options. (I write for them so trust me, they know their stuff when it comes to banks.)
7. Stick with one credit card, too.
Credit cards can save you money if you’re using them to earn cash back or other rewards but they can quickly become your worst nightmare if you end up with a bunch of debt.
When I was in the early days of single momdom, I had several credit cards I was trying to pay off. I swore I would never let debt pile up on them again once I wiped out those balances.
It took a year or so but eventually I paid them off and I stopped using credit cards cold turkey for a while. But then, I decided to give them another try only this time I laid down a few ground rules first.
I committed to charging only what I knew I could pay off in full every month and I decided to only spend with one card. I’ve been using this system for a couple of years now and it works great.
The card I use earns rewards and it doesn’t have an annual fee. I don’t ever worry about paying interest because I always pay it off each month.
Sticking with one card keeps things simple for me, which is what I’m going for with my money.
When you’re looking for a catch-all card, check out the rewards of course but also look at the fees and interest. If your goal is to simplify your finances, the last thing you want is a card that’s only going to cost you money.
8. Cut out the small stuff.
Something I’ve learned over the last few years is that it’s not the big things that blow my budget to pieces. It’s the little things — smaller expenses that I don’t really think about — that throw my finances out of whack.
So I took the proverbial red pen to my budget and eliminated things like:
- Recurring subscriptions for online video games (courtesy of my kids)
- Monthly account fees for homeschool websites that we rarely used (I blame myself for that)
- Streaming movie and TV services we just weren’t watching
- Subscriptions to magazines that I never got around to reading
- Monthly cloud storage service I was paying for that I didn’t actually need (Hello OneDrive!)
It was basically a bunch of insignificant little crap that was junking up my budget. Getting rid of these little expenses might seem like nickel and dime stuff but it can make a real difference in your budget.
9. Consolidate expenses.
Can I just say that bundling is a godsend if you want to simplify your finances and potentially save some money?
You can bundle things like your cell phone, internet and cable TV service together. My internet provider offers a discount for combining two or more services on a monthly bill.
You can also bundle things like your car insurance and homeowners or renter’s insurance. The sweetest part about bundling (aside from the potential savings) is that you can go from having several bills to pay each month to just one.
The bundling concept can also be applied to your debt.
Back when I had credit card debt, I combined all my balances onto a single card with a 0% APR using a balance transfer. I also refinanced my student loans and combined them into one big loan with a new servicer.
In both cases, I was able to cut down on the interest rate for my debts and streamline the monthly payments. I was also able to put more money towards the principal each month thanks to the lower rate.
Both those things helped me fast track my debt payoff and worry less about my money.
10. Uncomplicate your money goals.
Goals are a great motivator to take control of your money but it’s possible to have too much of a good thing.
If you’re setting big goals for your finances, that’s awesome. But if you have 10 or 15 goals to keep up with, you could just be setting yourself up to miss the mark on all of them.
Every December, I set two to three big financial goals that I want to achieve for the next year. Usually, those goals revolve around three things: saving, paying down debt and increasing my income.
I make my goals specific and realistic, then I focus on just those three things. If I hit one of my goals for the year early, then I replace that with a new one.
It’s a basic system but it’s worked for me. Over the past four years, I’ve paid off a $24,000 car loan in 15 months, saved over $250,000 and grown my income to multiple six figures.
If you’re struggling to gain traction with your financial goals, try scaling them back a little and focusing on just two or three things that are most important. Giving a smaller number of goals your full attention and effort could deliver better results than trying to do a dozen different things at once.
Simplify Your Finances Today for Less Stress Tomorrow
If you want to simplify your finances, remember — it doesn’t have to be rocket science. Just making small changes like these can make a huge difference in how you manage and relate to your money.
I’m not a financial expert but I’ve put each and every one of these tips to the test. All of them have helped me get a lot more zen about my finances and I want you to feel the same way.
What are you doing to simplify your finances? Hit the comments and tell me about it.
And don’t forget to share this post if it helped you!