Spring is often a time for renewal and rejuvenation, and since were cleaning out our homes and wardrobes, our personal finances should also get some concierge treatment. It couldn’t come at a better time given the economic impacts of COVID-19. According to WalletHub’s Coronavirus Money Survey, released in March 2021, 145 million Americans say they cannot afford another year like 2020. As a matter of fact, money problems have now surpassed COVID-19 as being the top stressor in America. According to the survey, 29 Million more Americans will also be applying for additional credit cards due to COVID-19 – a 15% percent increase over last year. Looking at your finances from a holistic wealth perspective, will enable you to have more success in achieving your goals.
Here are 15 Ways to spring clean your personal finances:
1. Identify Your Personal Financial Identity
As I stated in my book Holistic Wealth: 32 Life Lessons To Help You Find Purpose, Prosperity and Happiness, everyone should know their own personal financial identity so that we don’t end up making the same money mistakes as others and just following the crowd. I developed the Personal Financial Identities Framework with a free Quiz that allows you to identify your personal financial identity. The Keisha Blair Institute on Holistic Wealth also has an introductory course to help you harness the strengths of your own personal financial identity.
2.Craft Your Own Personal Mission Statement
If you don’t already have a personal mission statement now is a great time to craft one. If you already have one, Spring is a great time for a refresh especially in light of COVID-19 and new goals and priorities. Now that you have also identified your own personal financial identity (through step 1 above), it’s also good to incorporate it in your personal mission statement. Your personal mission statement should also align with your purpose in life.
3. Deep Clean Your Budget
According to the WalletHub Coronavirus Money Survey, many of us are spending more money on groceries, and cutting back on other expenses such as travel. Since our overall spending patterns have changed, our budget needs and update and refresh too. We need to also ensure that it reflects our current values and spending priorities, including new goals.
4. Tackle Outstanding Debt
Make a concrete plan to tackle outstanding debt. With 29 percent more Americans taking out credit cards than last year – it’s time to go through each credit card statement and ensure that there’s a plan to pay off all outstanding balances and this includes calling your credit card providers to negotiate more favourable payment terms. If you lost a job during COVID-19, let your bank or credit card provider know and take advantage of any relief programs available. This step also applies to other student loans, car loans, mortgages etc.
5. Declutter and Organize Your Paperwork
A proper spring clean wouldn’t be complete without a full declutter and organization exercise. Decluttering and organizing your paperwork will allow you to throw out old items you don’t need and put all your important paperwork in areas where you can find everything you need.
6. Channel the Holistic Wealth Mindset™
As I stated in my book Holistic Wealth, we all make over 35,000 decisions each and every day. We need to think of our decisions as either an addition or depletion to our holistic wealth bank account. This will provide a year-round spring cleaning filter so that we’re not clogging up our accounts with debt and unnecessary spending.
7. Start Thinking About Having Your Own Holistic Wealth Portfolio
At the Keisha Blair Institute on Holistic Wealth, we have an entire online self-paced course so you can build your own Holistic Wealth Portfolio or Blueprint. If you need one-on-one help, that’s also available via the Institute on Holistic Wealth.
8. Create or Update Your Estate Plan
This is a big one but would also be a part of step 7 identified above. With a global death count from COVID-19 now over 2.7 million, as of March 27, 2021, we should all ensure that our final plans are clear and up to -date and that includes looking at all life insurance policies, critical illness insurances and final instructions.
9. Make A Goal To Become More Financially Resilient
At the Institute on Holistic Wealth, we help members to become more financially resilient by structuring their Holistic Wealth Portfolios to buffer against life altering setbacks. With COVID-19, the old ways of looking at our personal finances has to be transformed. Financial resilience has to be the ultimate goal across your entire Holistic Wealth Portfolio and that includes your emergency savings as well.
10. Take A Look At All Automatic Deductions From Your Bank Accounts
Take ala look at all automatic deductions to ensure that you ruthlessly cut any monthly subscriptions you’re not using anymore and that have become redundant during COVID-19.
11. Take A Look At All Utility And Phone Bills
Repeat step 10 above and call your service providers to negotiate better rates and payment terms. If you now work from home and don’t need as many bells and whistles for your cell phone, see what features you can cut back on.
12. Track Your Net Worth
Your net worth is the value of all your assets minus your liabilities. Keeping track of your net worth is a great way to assess your financial health. It also provides motivation during tough times for keeping on track with your money goals and priorities.
13. Stress Test Your Retirement Savings
Working backwards from your target retirement date, conduct a quick stress test of your retirement savings. Call it the longevity revolution but people are living longer than before. Look at your retirement savings, and figure out your annual retirement income needs and see if you will have enough given estimated retirement spending.
14. Assess All Your Income Streams
Examine all of your income streams with a critical eye. Do you have enough income to meet your needs? If not, what is the plan to increase your overall income so you can also save and invest? Will you need to add a few passive income streams? How can you add some additional income streams? With the passion economy worth over $38 billion globally, there are many ways to monetize your unique passions, hobbies and skills. Think online platforms like Etsy, Shopify and Teachable that allow you to earn passive income from pursuing what you are passionate about.
15. Create An Overall Plan
The end goal of your spring cleaning exercise should be to come out with an overall plan to achieve your money goals. The plan needs to be forward-looking and a critical part of this is step includes building your overall Holistic Wealth Portfolio, which is a major component of our training at the Institute on Holistic Wealth.
In a recent episode of the Holistic Wealth podcast I also shared some tips for spring cleaning your personal finances. Listen to the podcast episode below:
Keisha Blair is the world’s foremost expert on Holistic Wealth and bestselling author of Holistic Wealth: 32 Life Lessons To Help You Find Purpose, Prosperity and Happiness, and the Holistic Wealth Workbook: 32 Life Lessons To Help You Find Purpose, Prosperity, and Happiness. Keisha Blair is the host of the Holistic Wealth Podcast and Founder of the Institute on Holistic Wealth.
For more information visit www.keishablair.com