Simplify Your Finances to Stay on Top of the Latest Developments
When it comes to your budget, mistakes come at a cost. There is an overdraft, there is a late fee, and you can pay a lot more than you need to. To prevent this from happening, simplify your finances until they are as simple as possible.
As the personal finance site Dividend Diplomats explains, the more you have to keep track of your money, the more likely you are to miss something. So, when you’re working on your finances, get it wrong:
Over time, small changes in financial habits can turn into a bureaucratic nightmare. I think this is what happened to me, and it caused an unnecessary burden. At the time of my decision, I am sure that getting this bank bonus was a great idea. I’m sure that opening this new refundable credit card, which is slightly different from my credit card with hotel points, attracted me for some reason. There is nothing wrong with adding layers, cards, reward programs like Swagbucks, and so on, and I don’t want it to be a callout here. But for me it was already overkill. I want simplicity and efficiency with my financial habit.
You can start by automating your finances wherever possible. Then focus on reducing the number of accounts you have to actively manage. It’s good to have a separate savings account that remains intact, but if you have to juggle five credit cards because of their different rewards, you introduce more points of failure.
Above all, be mindful of your cognitive load. The more you think about your finances each month, the more stress you add. If you’re automatically contributing to your 401k, you probably don’t think too much about it, so that’s your burden. But dealing with five different due dates on different bills within a month is a huge burden that you can simplify .
3 Ways To Simplify My Finances | Dividend Diplomats via Rockstar Finance