Spring-Cleaning for Your Finances

According to a recent report by the Consumer Financial Protection Bureau, more households had a hard time paying bills or expenses in 2024 compared to 2023.

Looking at your spending habits is a great way to jump-start building a budget. By seeing how you spend your money, you can find ways to create savings and pay down debt more quickly.

Reflect on all the purchases you’ve made for the sake of “convenience” rather than saving that money for bills or putting it into your savings account. This includes going out to eat instead of packing a lunch or cooking at home, or signing up for a free trial but forgetting to cancel the subscription. While occasional low-cost purchases can fit into a budget, daily recurring expenses can lead to large monthly costs.

According to the Consumer Financial Protection Bureau, households in the U.S. spend more than $14 billion each year on late credit card fees. Automatic bill payments can help you avoid late fees. Some services even offer interest rate reductions when you enroll in autopay. However, be sure to monitor your checking and saving account balances to avoid overdrawing them and getting hit with fees. If possible, call and request a different due date, which will give you a chance to space out transactions and avoid depleting your accounts.

If you notice that you’re only watching certain channels or using specific apps while ignoring others, it might be time to cancel those unused services. Deloitte reports that ad-free streaming services cost an average of $16 per month. With most households subscribing to about four streaming providers, that’s over $800 annually spent on TV or video services.

It pays to shop around for car and other insurance policies to make sure you’re getting the best deal. According to the Bureau of Labor Statistics, car insurance premiums have increased more than 19 percent since 2023. According to Consumer Reports, those who have switched insurers to save money on premiums had an average annual savings of $461. Don’t forget to compare rates on your credit cards. Look for the best rates or balance transfer offers that could help you save on interest and pay off your debt faster. If you own your home, check out home equity lines of credit (HELOC) to consolidate debt at a lower rate than what may be available on a credit card or personal loan.

Spring cleaning isn’t always about getting rid of things; it’s also about rediscovering the value of what you already have. Review your credit history and your credit score. Prepare your budget for upcoming expenses over the next several months and through the end of the year. If you haven’t already, make sure to start or keep contributing to your emergency fund. This fund will help support you through all of those unexpected events that come up, like car repairs, loss of employment, etc. This is also a great time to check your contributions to your retirement account. If you can, increase your contributions or get your retirement accounts started.