16 Ways to Simplify Your Finances
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Do you need to stop the overwhelm with your money? Feeling like your savings are unorganized? It’s time you learned how to simplify your finances and take back your time (and wallet).
Handling money becomes easier when you implement some new ideas. Here you’ll find some easy tips to simplify your financial life.
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1. Combine Banking Accounts
Something you can do to make saving and spending simpler is to combine your banking accounts. Many people have multiple bank accounts at different banks.
This is good in theory and works in some cases, but if you’re looking for the easiest way to handle money, having fewer accounts will be better for you. Here’s how to do it.
Only 1 Checking Account
Use your checking account at your favorite bank that is the most accessible. Close all other checking accounts and transfer the money from different checking accounts to it.
Then you can pay all expenses from one place instead of managing so much at once.
Only 1 Savings Account
Having only one savings account can also save you time. The same way you would with a checking account, empty all other savings accounts and transfer funds to the one you want to keep.
I recommend WealthSimple, as you’ll earn 4% interest on your savings! Plus, you can hold all your investment and stock accounts there too.
An even easier way to save with Wealthsimple? Use the automatic roundup feature to boost your savings account whenever you make purchases.
2. Combine Investment Accounts
Another thing you can do to save time is to combine investment accounts. This can be a bit of a process, but, basically, you need to start using one brokerage account, and you’ll need to fill out some paperwork. Again, WealthSimple is a great option.
3. Eliminate Paperwork Where Possible
Speaking of paperwork, something that’s great for your home and mental state is to get rid of paper clutter. So much paperwork comes in the mail, and often we shove it aside to be dealt with later. Instead, change your system!
Use Online Billing
Switch over all your payments to online billing. You’ll no longer get mail coming to your house from those. And it helps the environment, too.
Related: How to Keep Track of Bills and Payments Easily
Keep Digital Records
Rather than using paper for records, keep digital ones. Invoices, receipts, etc., can all be online instead.
Plus, it’s a more reliable method of keeping track of things. You can’t lose it like a paper record.
4. Automate Your Finances
To save some serious time and begin saving money consistently, switch to automated finances. It might take a little bit of time to set up, but once you do, you’ll wonder why you didn’t make the switch sooner.
Set Up Automatic Bill Payments
Automatically make all of your bill payments. First, you should set up direct deposits for your paychecks.
And then you can quickly pay your bills at the same time every month consistently. You won’t even need to think about it.
Automatic Transfers to Savings
It’s not just bills that can be handled automatically. You can also transfer money to your savings each month or week easily. Set up automatic transfers, and you’ll soon be saving a ton of money.
5. Simplify Your Budget Categories
Sometimes budgets get too complicated because there are too many categories. If you find you have too much to save and pay for, easily simplify your budget categories for less complication.
You can do this by renaming some things and combining categories. For instance, “utilities” instead of “electric,” “gas,” “water,” and other related items.
6. Pay All Bills at Once
Rather than making payments for the entire month on different days, pay everything simultaneously. Set up your auto bill pay to get all of your bills paid on the same day.
That way, everything gets paid at once, and whatever is left is extra. Choose any day that’s easy for you to remember, such as the beginning or end of the month, and at a time that makes the most sense for your budget.
7. Only Spend Cash
Take out some cash for spending money each time you make a budget and only spend the cash. It’s already come out of your bank account, so it’s accounted for, and it makes it much easier to keep track of how much you spend.
You can easily keep your cash organized and know how much of it there is, unlike when you use debit or credit cards and have to check a bank app or credit card app to find your balance. Cash is easy and can be used anywhere.
Related: 17 Advantages and Disadvantages of Cash Budgeting
8. Focus on Fewer Goals at Once
It’s way easier to accomplish what you set out to do if you’re focused on just one or two things instead of twenty. Focus on fewer goals and make more progress.
Pick your most important savings goals and throw all extra money at those instead of multiple places. Here’s why fewer goals make more sense.
Allows You to Hyper-Focus on Fewer Things Without so Much Mental Clutter
You’ll have fewer things in your brain when you think about budgeting and finances. This allows you to completely give your attention to a couple of things and cut back on all the mental clutter that may be causing you to not make progress.
Higher Chance of Success and Then You Can Move Onto the Next Thing
When all your focus is on one goal, you can reach it in record time. Then you’ll move on to the next item on your financial to-do list.
And because you are more focused, you might reach your goals more quickly and have a higher success rate.
9. Keep Only 1 Credit Card With the Best Rewards
Rather than reaching for your wallet and finding 10 different credit cards, all with their own balances to keep track of, just use one. Pay off any debts and close your accounts until you just have one credit card.
Pick it strategically – it should be the one with the best rewards that fit your lifestyle.
Then you only need to focus on paying off one card, and you are likely to get more rewards because you use it for everything.
10. Eliminate Debt
Guess what can be super stressful? Paying off debt for a long time and wondering how you’ll ever get ahead.
It’s time to remove this from your life for good. Here’s why eliminating debt is the best idea for your finances.
Reduces Stress
Say goodbye to stressful payments that keep you up at night. When you eliminate debt, you eliminate financial strain and stress with it.
You’ll feel much better when you pay off anything you owe and just have regular monthly payments for bills.
Means Fewer Payments to Track
When wondering how to simplify your budget, having fewer payments is critical. It will give you less to keep track of and think about.
Imagine going from having twenty payments to ten. This can be the case if you eliminate large amounts of debt.
Saves You Money
Not having debt saves you money on interest. Plus, you don’t need to be concerned about buying something and then actually paying for it later.
You’ll save cash and then be able to put that money towards better things that truly impact your financial future.
11. Pay for Things Yearly, not Monthly
Rather than buying something like a software subscription for your business, or TV streaming service and paying for it every month, opt to pay yearly. You can save up for it throughout the year, but you won’t have an annoying monthly payment to remember.
As a perk, many times, paying yearly is a bit less expensive than paying monthly, which is nice if you want to save. It can work as long as you have all the money upfront for the whole year.
Plan and save in advance if you’re going to purchase a new subscription. Start saving up now and switch over any monthly subscriptions you have when possible.
12. Cut Out Subscriptions You Hardly Use
Why pay for something you rarely use that doesn’t make your life better? If you find that you’re making payments for a subscription and you can’t remember the last time you used it, it’s time for it to go. Here’s why.
Save Money
This one is obvious – you’ll save money when you eliminate payments. And since you don’t use it often, you’re saving cash without giving up something that significantly impacts your life.
If you like to save money without feeling like you’re really trying, this is the perfect thing to do.
Less to Track
With fewer subscriptions, you don’t have to keep track of them or add them to your calendar. It will help you with time management and get rid of needless frustration each time you create a budget.
Pay for Necessary Subscriptions Yearly, not Monthly
If you absolutely need a subscription, choose to pay it yearly instead of monthly. For the reasons discussed above, it’s a great way to simplify your finances.
13. Rent Instead of Own
If you truly want to simplify your finances, you can choose to rent rather than own. Renting has a lot of benefits that people don’t realize. Here are some of them.
Reduces Expenses
If you opt to rent your home, you eliminate a few potentially huge expenses. You won’t have to pay HOA fees as you do for some houses.
Also, when home repairs and maintenance come up, you are generally not responsible for payment as the renter.
You can also rent other things instead of buying them to save money. Things like dresses for fancy occasions that you will only wear once, movies you want to see one time, etc. Renting makes sense for many things and can save you cash.
Related: The Hidden Costs of Renting
Less Responsibility
It’s way less to think about when you rent instead of own. The property isn’t yours, so you don’t have to worry about the value going down or handling repairs.
It’s not just financially simpler; it’s simpler for the rest of your life, too.
14. Own Less
Owning less is a great way to simplify and minimize expenses. Here are some reasons why having less stuff is a great idea.
Fewer Repairs and Maintenance
You don’t need to repair or maintain things you don’t own. This frees up your time and your wallet, too, as repairs can be quite costly depending on the item.
Less Physical and Mental Clutter
With less stuff, you have less physical clutter in your home. You’ll feel much better, and your house might be cleaner.
Not only that, but you’ll also get rid of mental clutter. You won’t need to think about your possessions, add their payments to your budget, or carry any stress because of the things you own.
Less Spending
Fewer possessions are a great way to spend less. Try selling items you no longer use or want, giving you more cash immediately.
Related: Where to Sell Your Old Phone for Easy Cash
And in the future, you’ll think harder about what you do own, meaning you are likely to spend less money buying things. You’ll want to keep up with your more minimalist lifestyle by buying less.
15. Live a Simpler Lifestyle
If you feel that your payments are too big and your life is too hectic, it’s time to change. Switch to a simpler lifestyle.
This can start with simplifying your finances, but then you can begin to include other aspects of your life, as well.
To simplify, start decluttering and owning fewer items. Then, remove meetings and time-wasters from your calendar whenever possible.
As you make decisions in the future, ask yourself if what you’re doing fits with the simpler lifestyle you’re trying to live. This will help your wallet and mental health.
16. Use a Password Manager
We use passwords for banking and investment apps, calendars, emails, etc. Who needs the exhausting practice of trying to remember all your passwords, or worse, writing them all down in various places and then being unable to locate them when needed?
Instead, use a password manager to help you. Something like LastPass will store all your passwords for you, and you only have to remember one. If this doesn’t simplify your life and finances, I don’t know what does.
Now You Know How to Simplify Your Finances and Get Results
Simplifying finances is a fantastic way to eliminate stress. You could save yourself a lot of money and time.
If you feel like your money needs an overhaul, this is the perfect thing to do. Simplify your life by combining accounts, eliminating debt, and more.
When you do this, you’ll find that life becomes more manageable, more relaxed, and your wallet is much more organized!
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