A good money management system isn’t just about knowing how much you have to spend or what’s been put aside for longer-term goals or bigger expenses. It’s having a system – a bit like a filing cabinet – where you can easily keep track of how much money you have to spend that month, how much is in your savings, and how much you’ve got to spend on a short-term goal.
When your money system, or financial filing cabinet, is messy and disorganised, that’s how you’re going to feel as well. You may struggle to find out how much you have in your emergency fund or how much you can comfortably put towards a holiday, and that’s when you’ll start to associate money with the feeling of overwhelm and stress. And you’ll probably tell yourself that you’re not good with money too.
But, what if it’s not you that’s the problem? Maybe it’s your system letting you down. Just as if we had a filing cabinet where there’s no clear organisation method and all the papers are jumbled together, if our finances are like this as well, then it’s going to be difficult to know our progress with our goals and to have confidence in managing our finances.
How to organise your money
Everyone’s version of an organised system that works for them will look different, and it doesn’t mean you need to have hundreds of different accounts either. But you might want to consider whether building these elements into your money system can help you feel more organised:
- Having separate current accounts for your bills and your spending
- Using sinking funds to save for pre-determined, irregular expenses such as Christmas and car insurance
- Add an extra barrier in to stop you dipping into your savings so easily
- Keeping your emergency fund and savings separate
When you feel organised about how you manage your money, you’re going to develop a more positive relationship with it, and you’ll associate it as a source of opportunities rather than a hindrance.
What does your money system look like?
