As I’ve mentioned before, I have a weekly routine where I set aside roughly two hours on the weekend to evaluate my to-do lists, take care of some weekly tasks that I’ve overlooked, and do some thinking about my long-term goals and what I’m doing right now to reach them (or not).
Naturally, personal finance is a significant part of that routine. There are several things that I do each week to make sure that our finances continue to flow smoothly.
Here are the personal finance related tasks that make up my weekly money routine.
Pay all bills We pay all of our bills on a weekly basis. If a bill has a due date in the coming week, we pay it. We also fully pay off all credit card bills each week.
For the bills that aren’t credit cards, we choose to wait until the due date is closer in order to keep the cash in our account. I usually just schedule them to be paid the day before they’re due using online bill pay.
For the credit card bills, I prefer to always keep the balance as close to zero as possible so that a big balance doesn’t ever build up. Plus, doing this ensures that I always have a very strong debt-to-credit ratio that virtually always remains below 10%, which is where I want it to be for my credit score.
Categorize expenses Over the past few months, I’ve taken to using
You Need a Budget to manage our family’s cash flow. I usually record all of our spending at once at the end of the week, which involves categorizing all of the different expenses.
I simply look at each thing we spent money on this week and assign it to the appropriate matching category. It’s really easy and just takes a few minutes.
Doing this enables me to really look at our expenses and ask hard questions about how we’re spending money. How exactly do I do that?
Review our spending plan After I’ve recorded expenses for the week, I look at our spending plan and see how those expenses match up with what we should be spending. Are our non-essential expenses too high? Are we spending too much on unnecessary things? Are we saving for everything we should be saving for?
This also takes just a few minutes, but if I discover a problem, I spend some time digging into the reason behind that problem, which can end up taking a fair amount of time.
Look for possible deductions and save them Did we spend any money on anything that’s potentially deductible this week? If we did, I record it in a separate spreadsheet and save the receipt in a manila envelope.
At the end of the year, this spreadsheet and manila envelope is a godsend. It makes filing taxes a lot easier, plus it directly saves us money on our income taxes. Taking two minutes once a week to record this stuff can add up to hundreds of dollars in tax bill reductions at the end of the year.
Learn about one new thing For the last several months, I’ve been choosing one topic to learn about or refresh myself on for the coming week. I try to devote five hours throughout the week to learning about this topic.
A significant number of those topics are related to financial issues. One week, I chose to look at Coverdell education accounts (I couldn’t really see why we would use one over a 529, but I was glad to know about them). Another week, I looked at how people do technical analysis of stocks. Another week, I dug into how the Federal Reserve sets interest rates. Another week, I focused on teasing through all of the fine print on a credit card (I expected to find some surprising clauses, but I really didn’t find anything that truly surprised me).
Each week, I learn something new about the world that strengthens my understanding of my own life, whether it’s through a better understanding of a personal finance issue or something else entirely.
A weekly financial routine is a valuable thing to get started in your own life. It doesn’t take too much time, but it’s very useful in terms of keeping your finances in balance over the long haul.