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Money Management: Clear Out and Start Fresh

Get rid of the old before starting with the new. Heard it? It’s the most effective old adage I live by. The same philosophy applies to taking on a new money management system.

There’s no way to start on the right track with new financial management systems without first clearing out the old, ineffective systems. I’ve met clients who have asked me to help them set up a money management system, whose houses are like walking into a disaster zone: piles of receipts, disorganized bank statements and not a folding file in sight.

Clean Up Before You Set Up
One of my favorite exercises when I need to shake things up around the house is to go through every room with a big black trash bag and get rid of things I no longer need. Once all of the old stuff is in the donation bag, and out in the curb for pick up, the room feels fresh. There is new space in which to think clearly.

The same method can be applied to finances. Whether it’s purging unneeded files on a desktop computer or organizing your bank statements, if you don’t clean up before you set up your new money management system, you’ll have to slog through extraneous material every time you look at your money picture. That is not fun, and makes a very simple process heavy and difficult.

Money Imitates Life
A friend recently said to me, “Something good has got to happen or I’m going to have a nervous breakdown.”

My response? “No! Step away from the dramatic statements!” You can’t layer a desire or hope for something good to happen on top of a feeling that everything is awful. You have to clear out that old, bad energy to make room for the good stuff. Once you do, it will come into your life that much faster.

The same goes for a beginning user of Green Sherpa or any other personal financial management system. The program won’t work for you if your financial world is in chaos. It’s the same situation as me trying to work on a new project in my house while staring at all of the old mess. Erase the negative static with some basic organization and clarity, and the system will work for you.

Originally published on Green Sherpa