The change of season is a prompt to update your money habits

Tomorrow's arrival of spring brings with it, for many, the undeniable urge to clear out winter's cobwebs.

And while you're considering how to reorganize closets and wash windows, it's also the perfect time to get your financial house in order, according to Stacy Yanchuk Oleksy, director of education for the Credit Counselling Society (nomoredebts.org).

If you're uncertain where to begin a financial spring cleaning, she offers these tips to spring clean your money habits:


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Go through your financial folder, or folders, and get rid of outdated information. If you don't have a folder, set one up to keep all your financial information at your fingertips. If you don't want all your bills and receipts in a single folder, do what Yanchuk Olesky does: keep a folder for each type of expenditure, such as utility bills, mortgage, insurance, groceries, etc. If you use paperless billing and online banking, you can set up folders online (through your email, for instance) to organize your bills and payments.

Review your budget. Are you on track or do some expenses need updating? Perhaps your transportation costs have increased, or maybe you no longer need cable TV. Yanchuk Olesky says many people don't know where a lot of their money goes and small ticket items are often to blame. These include takeout coffee shop beverages, lunches, and dinners out, etc. She suggests tracking every single expense for two weeks. Write them down or use a smartphone app to track them.

Making some spending changes. If you habitually buy takeout coffee and lunches, try preparing your coffee and lunches at home - it could save you several hundreds of dollars a month. Make a weekly meal plan and stick to buying grocery items on that list. Consider ordering groceries online for pickup or delivery; it can save you time and remove the temptation to buy items not on your list that you see when you are cruising the store aisles.

Examine your financial statements. What annual fees and interest rates are you paying? Yanchuk Olesky says Canadians love credit cards that offer points and will use them as much as possible to collect. But if you aren't paying off your credit card balance in full each month, it's not the best strategy since points cards can have high interest rates. A no-frills credit card, with a lower interest rate or a line of credit, might be a better option.

Review your bank statements and look at the automated withdrawals. Are you paying for a gym membership you don't use or for subscriptions for magazines you don't read? Look at what you're paying in bank fees - is there an account with lower fees that fits your needs?

Check how much you are paying to use ATMs that aren't your bank's machines since each withdrawal is costing you $3 or more. That's OK occasionally, says Yanchuk Olesky, but not if you are using other bank machines regularly.

Call your insurance and utility companies (such as cellphone and internet providers) and ask for a discount for customer loyalty. You may get a break on insurance if you haven't made any claims for a year or more. It costs companies less to keep an existing customer than to find new ones - and you won't get a discount unless you request one.

Review your debt repayment plan and savings goals. Are you making progress? If not, it's time to readjust. You could choose to exercise one of your mortgage pre-payment options or use your income tax refund to repay debt. Canadians don't like to talk about debt, says Yanchuk Olesky, but it doesn't discriminate and people with good paying jobs and great credit ratings can still have huge debt. There are many non-profit credit counselling services you can contact and a credit counsellor will have helpful resources and can you help create a plan for debt repayment.

Set a three-month goal for your next financial cleaning/review. "Once you've done this work, set it and forget it until the end of June," Yanchuk Olesky says. "You don't want finances to take over your life. Once you've done this work, it's easy to understand and carry on."

Copyright 2019. Toronto Star Newspapers Limited. Reproduced with permission of the copyright owner. Further reproduction or distribution is prohibited without permission. All Rights Reserved.

This article was written by Tracy Hanes from The Toronto Star and was legally licensed by AdvisorStream through the NewsCred publisher network.

Eric Lidemark, CLU, CFP, CHS profile photo
Eric Lidemark, CLU, CFP, CHS
Certified Financial Planner
Lidemark Financial Group Inc.
(604) 538-6565