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5 easy tips for getting your finances in shape for 2021

Get finances in shape
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When it comes to New Year’s Resolutionizing, getting our bodies and money in shape are the popular champions, and they have a lot in common: Both types of fitness are great for our future selves but not all that fun in the present, and both tend to be approached with no small amount of dread. 

I suggest we set aside losing weight for a second. In 2020, food was frankly one of the only comforts we had left, and exercise got way harder for most of us. So let’s grant ourselves a little extension on getting our bodies in shape. But getting financially fit? So dang doable. 

This guide will help you get the dread out, laying the groundwork to making financial management an activity you actually look forward to. Because meeting financial goals takes commitment, and to make any commitment stick, we have to not hate it

These five practices might seem a little out there, but they sure have worked for me. As a not-super-disciplined person with limited funds, I sent three kids to college, own a handful of real estate, and was feeling financially comfortable by my mid-forties — all using variations on the tips below to turn the frustration and tedium managing my finances into…a pretty good time.

In the coming weeks, we’ll be publishing tangible practices for money-management, as well as some recommendations for software to suit your needs. But today, it’s all about getting yourself in the mood. Success at anything is about mindset and approach — so let’s get started!

Getting started: Look, but don't touch

Fear of the unknown is a huge thing, and it keeps us from getting things done. If you feel a tightness in your chest every time a notification from your bank dings onto your phone, take a week or two to ratchet down the overwhelm and just be an observer. Open your bank app once a week. Look at your online credit expenses every couple of days. Just look. See, that's not so scary, right? You can hardly expect to really master something if you don't start out by getting to know it.

Time-box, bay-bee!

Time-boxing is a technique in which you commit to an amount of time to spend on a project, rather than to actually completing it. Make a timing commitment, stick to it, and don’t go over! (If, every time you sit down to manage your money, you emerge exhausted 4 hours later…dreading the sitdown is inevitable.)

You’re in this for the long haul, and the tasks will still be there next time. Whether it’s a two-hour block or fifteen minutes, set a timer. Or make a music playlist that’s the exact right amount of time. You might tell yourself “I’m going to pick up my finances every night this week for exactly four songs. At the end of the week, I’ll decide what’s next.” 

Make a jar of quick wins

Spend 15 minutes writing out simple financial to-dos on slips of paper. Crumple them up, put them in a jar or bowl. Each time you sit down for financial sesh, do one of these tasks. Don’t try to bite them all off at once! Ideas include:

  • Download a budgeting app and spend 15 minutes playing with it
  • Set up online automatic payments for my credit cards
  • Read up on consolidating debt
  • Look into refinancing

Get a workout buddy

Keeping financial deets private is a personal preference for many, but that doesn’t have to mean isolation. Reach out to your friends; would anyone else like to up their financial fitness? Make a plan to get together regularly, virtually or in person, to work in parallel on financial fitness.

Agree you'll get a little chitchat in, then put your heads down and get to work. You’ll learn from each other just by asking the simplest questions: "Hey, do you carry life insurance?" or "I can't figure out what this thing is on my credit-card statement. Do you think it's worth calling them?" or just work in companionable silence, and then talk about the kids or whatever. You can decide on monthly themes — maybe budgeting, retirement, rainy-day savings —or just have the accountability of someone else in your orbit working on the same things you are.

If 2020 gave us anything, it surely helped many of us see how dangerous isolation can be to our overall well-being. How about seeing your financial fitness as an opportunity to create a little community?

Set up your spaces

When it comes to managing our money, it's often not the task itself that's daunting - it's all the crap we need to gather to get that task done. Like how the biggest barrier to going to the gym (in the beforetimes, when we went to the gym) was finding clean footie socks. (Tell me I am not alone in this.) The hour you spend today to set up your administrative infrastructure will save you a whole year of dreading the sock-locating part of your financial “exercises.”

  • In your digital space: On your phone or laptop, create an app group or folder that contains all the financial tools you use. If bio access (e.g., fingerprint) is available and you feel comfortable using it, go for it. And don’t be afraid to use some whimsy, here; name your group after song lyrics: "Rich Man's World," "Mo Money, Mo Problems", or to help you keep your eye on the prize: "Retire in 2035" or "Climb Mount Kilimanjaro"
  • In physical space: If the tangible world is where you manage your money, get a box — it doesn't have to be fancy — and a bunch of envelopes or manila folders. Label everything: Bills, Tax Stuff, Insurance, Retirement, and so on.

What's next

Following the steps above will create a framework in which you are more likely to stick to your financial fitness. Get cracking, and next time we’ll start filling that framework in. Good luck!

Margot Page

(Image credit: Margot Page)

Margot Page is an editor and writer covering personal finance based in Seattle, Washington. She led the product management team for both Microsoft Money and MSN Money.