1. Pick a bank, any bank

I’ll confess, we have too many bank accounts.  Our main chequing account is at one bank.  Our RESPs are at another.  My RRSPs through work are with one financial institution and my husband’s are with another.   It’s too many accounts!  I often see worse.  Many people I meet with have multiple checking accounts.  Most of these have a monthly fee.  It keeps things simple if you can keep your banks and financial institutions to a minimum.

2. Keep a checklist

I keep mine in a Google spreadsheet.  It’s an easy way to keep track of month end balances without having to refer to all the statements.

A lot of financial clutter comes from not knowing where everything is located.  Having an up to date checklist all in one place is a simple way to keep track of your accounts.

3. Use one credit card or debit card

You can have more for emergencies or if ever you find a place that takes one and not the other.  I have two credit cards, a Visa and a Mastercard but I only use the Mastercard.  I have the Visa in case of emergency, if the card doesn’t work, gets lost or stolen or I find a place that doesn’t take Mastercard.  The less bills due every month, the less financial clutter in your life.

4. Automate as much as you can

Every bill we pay except for the Mastercard bill is paid out automatically every month.  Automatic deposits are great too.  Gone are the days where I had to stand in line at the bank every payday.  Now I check online on the day it’s due and there it is.  Automation means the only thing you have to worry about is making sure there is enough in your account to cover the bills.

5. Out with the old

In Canada, you need to keep your tax information and tax receipts for six years. After that, it’s time to shred them.   I shred the 7th year file when I place the next year’s file in the filing cabinet. You can shred old cheque books.  Throw out any warranty information or manuals for things you no longer own.  Now that it’s possible access Visa and Mastercard information online, I don’t even keep statements.  I can print a new one if I really need it.  I keep receipts in my wallet.  Once a month I go through them and throw out any receipts that are past their return by date.  For larger items with longer warranties, I staple the receipt to the manual and keep it in the filing cabinet.  I only keep ATM slips until I confirm online that the right amount was withdrawn.

Just because we’re heading towards paperless fiances, doesn’t mean it will reduce the financial clutter in our lives.  We need ways of tracking and organizing our finances so we know what we have, where it is and how to find things when we need them.

How have you reduced the financial clutter in your life?

Kathryn has been a staff writer for MDJ since January 2009. During the day she works in an office. In her off hours, she volunteers as a financial coach helping ordinary Canadians with the basics of money management. Kathryn, along with her husband and two children live in Ontario.

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  1. Mike on February 25, 2010 at 9:18 am

    I’ve been in the habit of keeping all my bills (cable, phone etc) but I’m thinking maybe I don’t need to. I like to keep my visa statements though since sometimes I have to look at them again.

  2. No Debt Guy on February 25, 2010 at 9:55 am

    A year too late. I just opened my 2009 receipt folder for my business and I am now wishing I took 5 or 10 minutes a month to keep things organized.

    Once I get that sorted out and my taxes submitted I am going to do a better job in organizing this year.

  3. uber on February 25, 2010 at 11:43 am

    if you didn’t have your picture at the bottom of the article, i’d swear you were my wife!

    (that and you mentioned something awhile ago about living near a Sobey’s but preferring to go a bit further for the Zehr’s makes me REALLY wonder if you’re not my wife!?!)

    great tips and thanks for confirming we are not the only people this organized!!

  4. as on February 25, 2010 at 11:57 am

    “Paperless fiances” – now that‘s an idea!… :-)

  5. 2 Cents @ Balance Junkie on February 25, 2010 at 12:24 pm

    There is always something to do to get more organized. I’ve let things lapse a little over the past year due to a lot of changes in our situation. I need to take a weekend and do some serious financial clutter control.

    I like the idea of automating all of your bill payments. Right now, some of ours are automatic and some aren’t. Maybe it’s time to automate it all. The tax tip is timely too. (Sorry for the alliteration overload. That was an accident.) Thanks for the tips!

  6. DAvid on February 25, 2010 at 12:54 pm

    I’ve specifically decided NOT to automate bill payments, as it forces me to confirm them. However, I have semi-automated the payment. Once I have confirmed the amounts, I pay them through the post-dated payment option on my bank’s website.

    I have also moved as many of my bills as possible to electronic notification. This allows me to check, confirm & pay from anywhere I can access a computer. While this is a little more work than automatic payments (especially if vacationing), I feel more comfortable with it.


  7. YYC81 on February 25, 2010 at 1:00 pm

    I have some of my bills automated, but I do still like the control of deciding when to pay some things. Given that I accidentally paid my VISA bill a couple days late around Christmas and had to pay interest (ick), I might want to re-think that. ;)

    I shred receipts once I’ve entered them into my financial software unless it’s something I might have reason to return. I have statements set to online where I’ve been given the option. I’m tempted to start scanning in the paper statements I still receive, and just shred them once they’re electronically stored.

  8. Andrew F on February 25, 2010 at 2:03 pm

    Is it not wise to keep receipts after you’ve tracked them (in case of audit)? Or should that only be done for expenses used as deductions?

  9. Ms Save Money on February 25, 2010 at 2:16 pm

    The best way – is to keep everything in electronic.

    If you eat out and have receipts – save it until the end of the week and reconcile them (enter into excel).

    This definitely helps – and you see how much you’re spending every week.

  10. Anjo on February 25, 2010 at 2:23 pm

    I was having trouble keeping up with all of the paper filing that comes with investments, bills, receipts, etcetera. As YYC81 mentions in his comment, about six months ago I decided to go 99% paperless (still retain paper copies of income tax documents and others where originals are required) but everything else is scanned and filed electronically. After scanning the documents, they are shredded. One caveat, be sure to regularly back up your information as a hardware failure could destroy all of your records.

    I had already subscribed to e-billing where possible but my one frustration with that method is that the records are often only maintained by the vendor for a limited duration of time, somtimes as short as six months. I can now convert these online bills to Adobe .pdfs and determine myself how long I want to keep them.

  11. FirstGenerationWealth on February 25, 2010 at 2:32 pm

    One trick I have done and suggest to clients is to scan a copy of your tax doc’s to .PDF format and keep in a folder on your computer. Store the hard copy away, but when dealing with your bank its easier for you (And the lender, take my word for it) when you can forward an email with 3 years doc’s T1’s/NOA’s (Especially for business for self tax filings).

    Its a much greater ‘quick reference’ to tax info than digging through boxes in storage.

    Just my $.02

  12. bob on February 25, 2010 at 2:52 pm

    epost, by Canada Post, is actually a pretty nice system.

  13. Mike 4P on February 25, 2010 at 3:16 pm

    Probably a stupid question, but can you automate irregular bills?

    Ie Ontario Hydro, Enbridge Gas, Bell telephone (to name 3 that I pay manually every month or so).

  14. Michelle on February 25, 2010 at 3:18 pm

    Bob, I tried epost, but found out it wasn’t very useful for me. Only 2 of the bills I pay were in their system as providers. It ended up being another site to log on to. I think the idea is great, but it needs some work.

  15. FrugalTrader on February 25, 2010 at 3:35 pm

    Mike, do they take credit card as payment? Most places that take CC as payment will also accept pre authorized payment.

  16. Brendan on February 25, 2010 at 4:01 pm

    Is the 6 year rule a for sure thing with CRA?
    I recently read that CRA was going after one of the Rizzuto’s in Montreal for tax evasion dating back well over a decade ago.

    (I have nothing against mafia.. not that I am saying mr rizzuto is or isnt a mafia guy, nor am I planning on evading taxes).

    But if I were to do a smith manouevre, I would hate to have them go back past 6 years.

    I have heard that CRA can go back as long as they like if they really want to. Is this true?

  17. YYC81 on February 25, 2010 at 4:33 pm

    The legal requirement is to keep records for at least 6 years. There are a few things that have to be kept forever (mostly relating to incorporation). The CRA can specifically ask you to keep certain records for a longer period of time. You can ask the CRA for permission to destroy records early.

    The CRA can review and reassess a return up to 3 years (I think) after the initial assessment. In cases of fraud or misrepresentation, they can go back as far as they want .. though how thorough an audit they could do a decade after the fact is questionable.

  18. Bilbo Bloggins on February 25, 2010 at 4:35 pm

    Sorry to burst your bubble, but while credit card statements can be accessed online, they often only keep 6 months to 1 years worth. If you want to retrieve the older stuff, they will make you pay.
    Same goes for online banking.
    Did you really think the financial institutions would give you everything for free?

  19. Kathryn on February 25, 2010 at 5:20 pm

    Mike4p: I just called up each of the companies and asked how I sign up for automatic billing. Regarding hydro, water and gas, we arranged to go on equalized billing so not only does the bill come out automatically every month, the same amount comes out every month.

    I tried e-bills too but also found it wasn’t very useful for my needs. Happy to hear it works for others though.

    Andrew: You need to keep receipts that you claim for tax purposes for up to 6 years. I’m referring more to non claimable grocery or entertainment receipts that aren’t needed anymore.

    Uber: Perhaps your wife and I should meet. She sounds like my type of person. :-)

  20. Steve on February 25, 2010 at 6:42 pm

    A problem with automatic withdrawals is if a business makes an error, they could withdraw more cash out then they should be. By paying them yourself, if they make an error, you call them up and have them correct the bill, then you pay the correct amount.

    Its a good idea to be up to date with the bills, if it’s automated, it might be forgotten just how much you are paying!

    If a bill accidentally withdraws too much, you will not get an immediate cash refund, you’ll get a future credit, which could leave you cash strapped or even accidentally in overdraft. I’ve seen the latter happen to people who live paycheque to paycheque.

  21. The Reverend on February 25, 2010 at 11:27 pm

    has anyone done detailed math on equal payment billing? i can’t help but thing the company somehow upfronts the billing to protect themselves and the users end up losing out slightly.

  22. Ken Siew on February 25, 2010 at 11:54 pm

    Totally agree with automation. People are lazy to think about paying the bills and forgetful all the time. It’s saved me a lot of headache and mind power that I could put into use elsewhere – like building a biz and earning more money.

  23. mp on February 26, 2010 at 12:22 am

    All my banking is automated. I never set foot in a bank. I have a great financial software that keeps track of bank accounts and investments. I pay all bills on line but I keep all my bills for 1 year with the tracking number of the bill payment.

    I never knew it was 6 years to keep tax returns. I keep 10 years just in case. 4 more years doesn’t take up much more room in the filing cabinet.

  24. bg on February 26, 2010 at 12:09 pm

    I had automated the payments of my bills using my checking account, but the Canadian Tire MasterCard allows me to pay my bills expecting from me carry balance at the end of the month and make interest of that, at the same time you save 1% in return.
    I decided the following
    1-stop the automated payments
    2-Pay as much as I can with my credit card
    3-pay on time and full my credit card.
    Also another detail, my checking account allows me certain quantity of transactions per month, with this method I reduced the amount of necessary transactions transforming them in just one, the payment of my credit card.

  25. Stephen on February 26, 2010 at 12:40 pm

    I’ve been planning to go 100% electronic this year if possible. However I’m wondering if any of you are encrypting your bills and data on your computers. Maybe I’m just paranoid, but if I virus gets in there and starts transferring your files out over the internet or if somebody gets a hold of your computer or laptop then that’s a lot of financial and personal information about you all in one place.

    Anybody else concerned about this or am I just paranoid?

  26. Anjo on February 26, 2010 at 1:18 pm

    Stephen: I haven’t bothered encrypting the data. My folders are protected by user id and password, although I assume a hacker could break through those locks. I keep my virus and spyware software up to date and scan regularly. I suppose someone could access the information on my computer, but I think the chances of that happening are very miniscule.

    Based on recent occurences, I am more concerned with the security of my information as held by the credit card, utility or other company. Not much I can do about that though.

  27. Matt @ Dividend Monk on February 28, 2010 at 1:39 am

    Good post. I especially agree with the point about limiting banks. If you have investing accounts with brokerages, it can also get a little out of hand because you might have various accounts there too.

  28. Senk on March 2, 2010 at 1:18 pm

    I would hang on to your credit card statements. You’ll need them if you ever need to make an extended warranty claim through your credit card.

  29. chewy on March 22, 2010 at 5:56 pm

    I too have been trying to go paperless. I find the majority of utilities and Banks offer PDF statements (RBC has every statement available to me in pdf format since they started offering paperless statements – 2006 I think).

    A couple of Banks (BMO and TD that I have found) don’t offer statements in PDF format, which really bothers me. They have told me I can download the statement with my financial software. I do download it, but I also want a bank statement in PDF format as that is only record that is official. It is also a record that cannot easily be changed. Until they offer the statements in PDF format, I will not go with their Paperless statement option. When I get their statements in the mail, I scan them to PDF and then shred them.

  30. chewy on March 22, 2010 at 5:58 pm

    Another point, since I am getting a lot of my tax documents now in PDF, why keep any paper copies of anything for Personal Income Tax? If you have everything in Electronic format, and have some sort of backup solution, is there any requirement that you have a paper copy of something? I could see some potential issues with Businesses and why they might want to keep paper copies, but for personal taxes that are fairly basic?

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