When you think of spring cleaning, you probably think of tidying your home, but that’s not the only cleaning you should be doing.
It’s that time of year for spring cleaning your finances too.
It might not sound like a good time, but organizing your filing cabinet and contacting your credit card company once in a while is beneficial.
In this article, we’ll look at how to spring clean your financial house to get it in order. We’ll also look at exhibiting proper cyber hygiene to protect yourself from identity theft.
Spring-cleaning your financial house
For many Canadians, springtime is a time of refreshment and excitement. The beautiful weather has finally arrived, the snow is melting, and the birds are chirping. It’s enough for you to want to fire up the barbecue at the first sign of spring.
A tradition that comes with the arrival of spring is spring cleaning. It’s an annual tradition for a lot of families. Canadians celebrate by cleaning their homes and giving away stuff that they no longer need.
But don’t stop there. Why not take spring cleaning a step further and clean your finances this year? In between painting the garage door and cleaning out the attic, take some time to review your finances.
Is your retirement planning on track? Do you have your tax slips to file your tax returns? Spring is the perfect time to answers those questions and reorganize your finances as needed.
Bring your personal finances into this decade
Have you ever walked into a friend’s home and felt like you’d gone back in time to the 1990s? Spring is the perfect time to get rid of the old and make room for the new. The same holds true with organizing your finances.
If you haven’t taken a look at your finances in a while, now is a perfect time. Start by looking at your bank accounts. Are you getting the best interest rate on your savings account? Are you paying bank fees on your chequing account when you don’t need to be? Out of sight, out of mind is not the best approach when it comes to your finances. Doing this too often can spell disaster for your money.
Similar to your house, your household finances will become an absolute mess if you don’t keep regular tabs on it. You can avoid this altogether by creating a budget and sticking to it. This will help you resist the urge to keep adding debt. You’ll be more likely to be heading in the right direction, even if your basement is still a mess.
Measuring your financial success
When checking your current financial situation, ask yourself if this is where you’d like to be when you compare yourself to last year. If you did some financial planning with your personal finances, but it hasn’t helped you achieve your goals like saving money, then there must be a blemish somewhere. Take a closer look and figure out the root cause.
Come up with a solution
Have you figured out why your budget hasn’t gone according to plan? Was it because it was too unrealistic? Have you had setbacks in your budget, and you’re finding that you’re making impulse purchases that you can’t afford? Knowing where the weakness is in your spending will enable you to come up with a financial strategy that works and allows you to accomplish goals like paying off debt sooner.
Redo your financial goals
Life is always changing, and so are financial priorities. There’s a chance your financial priorities could be different over the last few months. Your budget must reflect that. Your dream vacation to the Caribbean may take a back seat to other essentials.
Stop making your creditors rich
If you’re only making minimum payments on any high-interest debt that you’re carrying, the only one you’re helping is your creditors. Try out our credit card debt calculator to see how much money you’d save. You can also see how much sooner you’d be debt free if you reduced your spending habits just a bit and added a small amount to your monthly payments.
Ask for help from a financial professional
You’ve followed all of our advice in this article. You’re regularly tracking your spending, but you still can’t seem to save any extra money. If that’s the case, it’s good to know that you’re not alone. It’s a great time to reach out to a non-profit credit counsellor for some help. By seeking out the help of a trained financial professional sooner, you can get your finances back on track sooner as well.
Are you spring cleaning your finances? Don’t forget about good cyber hygiene
When you think of spring cleaning, cleaning the attic, garage and basement are probably the first things that come to mind. You may have already cleaned out those places, but your spring cleaning shouldn’t stop there. The arrival of spring is a great time to practice good “cyber hygiene.” You can do that by cleaning your finances. By cleaning your finances, you can help keep yourself safe from identity theft and fraud.
Identity theft is a growing problem in Canada. In 2014 20,611 Canadians fell victim to identity theft. This resulted in total losses of $10.5 million.
The best wait to protect yourself against identity theft is to be proactive. It all starts by keeping yourself financially organized. By practicing good cyber hygiene and decluttering your online presence, it provides you with a sense of security.
Being proactive with your cyber hygiene makes sense. Unless you want to be one of the tens of thousands of Canadians that fall victim to identity theft, you’ll want to practice good cyber hygiene. It’s much better than having your hard-earned money disappear. Not to mention, it can have severe consequences for your credit report and credit score. It could take you years to repair the damage that a fraudster does to your credit.
Be careful who you add on social media
Social media comes with a lot of benefits. Mainly it makes it easier to stay in touch with family and friends. However, there’s a dark side to social media. Fraudsters will always be on the lookout for their next victim. The less personal data that you have on the World Wide Web, the better.
You can be extra vigilant by only adding people that you know and trust on social media. Sometimes those that add you on Facebook and Instagram who claim to be your friends are just fraudsters in disguise. They may just be adding you to obtain personal information so that they can defraud you later on.
Don’t make your password too easy to guess
Fraudsters are always playing a game of cat and mouse with cybersecurity experts and the authorities. Companies like Google and Microsoft have been trying to get away from passwords for years. Despite their best efforts, most Canadians still use passwords to access some accounts.
It’s time to review your passwords and see if you could be doing more to protect yourself. While it may be easiest to use the same password for everything, you’re leaving yourself open to significant financial losses if one of the websites you use this password for were to be compromised. It’s a much better practice to use several different passwords for different sites.
It’s a good idea to get in the habit of changing your passwords regularly. When it comes to choosing your password, the longer the password, the better. Try to include a combination of characters, letters and numbers, too. It’s all about not making it too easy for fraudsters. Avoid easy things like your birthday, names, addresses or anything else related to personal data. Not only is it easy to guess, creating a password like this is most likely against your bank’s password policy, meaning you won’t be covered if your finances are compromised.
Don’t forget that hackers are getting more sophisticated with each passing year. If your Facebook profile is public, by looking at your personal information, it could make it easy for fraudsters to guess your password if it has personal data in it. And once a fraudster gets into your account, you’re open to financial losses as well as cyber-attacks.
If possible, you might consider enabling two-factor authentication and other password alternatives to help protect yourself from cyber threats before they happen.
Come up with a Plan B
If you aren’t already in the habit, get into the habit of regularly backing up your computer. You can do that by backing it up on an external hard drive or on the cloud. Even the best anti-virus software can leave you vulnerable sometimes. I may be more work, but it’s well worth the effort. You’ll save yourself time and the stress by having most of your information backed up somewhere safe.
Choosing anti-virus software isn’t just about setting it and forgetting it. Anti-virus software that may have been good for you a couple of years ago may no longer do the job today. When you conduct spring cleaning for finances, evaluate your anti-virus software too. Does it still meet your needs? Are you still adequately protected? If not, you should be on the lookout for new software.
Spring cleaning for finances is essential right now as the coronavirus pandemic spreads worldwide. Making sure you have savings available for the short-term is of the utmost importance during a health scare. In addition, ensure you and your family are cleaning their hands for at least 20 seconds several times a day.