Getting organized with your finances will help you make better decisions about what to do with your money. Many of us believe that a higher income ensures financial stability. Unfortunately, poor spending habits carry over regardless of salary. Being organized with your inancial affairs requires proper planning, discipline and sometimes, significant changes to your everyday life.

There are seven basic areas for getting your financial life organized:

• Your financial goals
• Your budget
• Your spending
• Your credit use
• Your credit rating
• Your communication with family members
• Your financial records

Most people who have money didn't get it overnight. They set goals and worked hard to reach them. Setting financial goals (like taking a vacation, paying off a debt or buying a car) takes planning, patience and a willingness to work toward them. Setting goals requires discipline and sometimes changes to your lifestyle. There are three types of goals:

Short-term goals - These are goals you'll set and accomplish within one month to one year. Goals can include birthday gifts, holiday gifts, taking a family vacation, paying off a credit card or buying a new TV.
Mid-term goals - These are goals you'll set and accomplish within one to five years. Goals can include paying off all your credit cards, purchasing a new car, remodeling your kitchen or saving for orthodontic work.
Long-term goals - These are goals you'll set that will take five years and longer to accomplish. For example buying a new house, saving for a child's education (college or trade school) or saving for retirement.

Tips to achieve goals:

1. Write down your short-term, mid-term and long-term goals.
2. Set due dates for attaining your goals.
3. Be realistic. (Don't increase financial stress in your life when setting goals and dates.)
4. Be flexible. (It's ok to adjust your goals and strategies.)
5. Review your goals. (Go back and look at your goals after six months to check your progress.)
6. Refer to: Setting Financial Goals Worksheet, located in the "Worksheets" button above. You should print this worksheet and fill-in your goals.

We live in a society that has taught us to "buy now, pay later." This method has caused consumers to overspend and allowed them to become knee-deep in debt. Consumers need to take control of their spending and realize that their financial situation can be overcome with proper budgeting. Unless you're tracking your money, it's probably not going where you really need and want it to go. The goal to proper budgeting is to make sure that your monthly expenses do not exceed your monthly take-home income.

Tips to budgeting:

1. Write down your total monthly take-home pay. Then list your monthly expenses. At the end of the month, subtract those expenses from your total take-home pay.
2. Look for places to cut back and save.
3. Use this information to set a monthly budget that includes 5% to 10% savings.
4. Review how things are going each month. By doing this you'll be able to see where overspending is occurring and adjust it accordingly.

First, you need to control the emotions and impulses that stimulate your desire to spend money. Second, you should keep close track of what you spend so you can stretch those dollars as far as they can go, whether it's buying food, clothes, or paying monthly household bills. Ask yourself, "What can I realistically do without?" In addition, you should always be able to cut back on personal care, hobbies and entertainment.

Tips to saving money:

1. Cut back on home energy consumption. (Turn lights off more frequently, eliminate unneeded options on your phone plan and wrap your water heater. In addition, most utility companies have "load management" and "off-hour" programs in which you can enroll.)
2. Shop at outlet stores or wholesale clubs. (When shopping, always shop using a list, not by impulse. Sticking to a list will control your spending. Try to use coupons when possible and buy generic brands instead of brand names.)
3. Bring your lunch to work more often.
4. Take advantage of free or low-cost activities in your community.

Borrowing can help you meet your long-term goals for education, car or home. But borrowing for day-to-day needs and wants gets many people into financial trouble. Before using your credit cards, obtaining a payday loan or borrowing against your home's equity, ask yourself if you really need to borrow the money. You should always use credit with caution. Consider avoiding using credit cards at all or only in extreme emergencies.

Tips to using credit with caution:

1. Avoid spur-of-the-moment purchases.
2. Set a monthly limit on credit card purchases.
3. Don't allow credit payments to exceed 20% of your monthly take-home income.
4. Don't borrow from one credit account to pay another account.
5. Pay more than the minimum on your credit card bill. Example: It would take 37 years to pay off a $3,000 credit card balance with a 18% interest rate if you make only the minimum monthly payment of $60 (2% of the outstanding balance.) (Source: Bankrate.com)
6. Try to pay off the full credit card balance each month.
7. Leave your credit cards at home when you go shopping.

Credit card companies, lenders and other financial institutions use credit reports as a main reference when deciding to issue you a credit card, increase a credit line or loan you money. Insurance companies, landlords and employers also check credit reports. If your credit report shows late payments (30, 60 or 90 days), collections or charge-offs, this could have a negative affect on your chances of obtaining additional credit.

Tips to protecting your credit:

1. Pay your bills on time.
2. If you're having trouble paying bills, consider contacting your creditors, a reputable non-profit credit counseling agency or other professional before becoming delinquent.
3. Check your credit report every six months from all three bureaus to make sure that payments, balances and accounts are being accurately posted on your report. Credit bureaus can sometimes make mistakes if the information that is supplied to them is wrong from the creditor.
4. Alert the three credit bureaus if you see mistakes in your report.

Having financial troubles doesn't make you a bad person. Being honest about your financial situation with your spouse and children will help ease some of the emotional pressure. Talking to your children about financial problems that may impact them can help alleviate their fears and encourage them to be supportive of any changes that may occur.

Tips when talking to family:

1. Explain how much income is coming into the household. Go over options of obtaining additional income. (getting a second job, etc.)
2. Create a family budget together. This will help them understand how much money can be spent each month on entertainment, gas for the car, utilities, food, etc.
3. Help from your children. If your children are old enough (16+) don't be afraid to ask for their help in bringing in additional income.

Have you ever applied for an auto loan but couldn't find your paycheck stubs to prove your income? Keeping your financial records organized where you can get to them can make your life easier. Here are the main items that you should keep organized:

1. Household Documents - Such as paycheck stubs, monthly bills, bank statements and canceled checks. You should create a file folder for each item. These file folders should be stored in "banker boxes" which can be purchased at your local office supply store. Note: You will use a new box for each year.
2. Financial Documents - Such as tax records, mortgage notes, lease notes, auto contracts, divorce agreements, child support agreements, military papers, etc. You should create a file folder for each item. These file folders should be stored in a fireproof safe.
3. Estate Documents - Such as wills, life insurance policies, stock certificates, bonds certificates, family trust papers, managed account portfolio statements, business agreements and other investments. You should create a file folder for each item. These file folders should be stored in a fireproof safe.
4. Family Documents - Such as social security cards, birth certificates, marriage certificates, nationalization records, citizenship papers, passports and copy of driver licenses. These file folders should be stored in a fireproof safe.

1. Use a computer. You should consider purchasing a financial software package like "Quicken." This program can organize your paychecks, monthly bills you pay, itemize your home furnishing, assets, bank accounts, and investments. In addition, it will outline what you have spent on specific areas (like food, clothes, etc) throughout the year.
2. Make sure to set aside time every week, two weeks or month to file all your records into their designated file folder and place.
3. Household documents should be stored for at least five years.
4. For Financial, Estate and Family documents, you should place all originals in a fireproof safe and a copy of those documents in a safe deposit box at your local bank.
5. Always shred your documents before you dispose of them.
6. Make sure a loved one has the combination to the safe and knows where the safe deposit keys are located.
7. Refer to: Organizing Records Check List sheet, located in the "Worksheets" button above. You should print this worksheet and use it as a reference when organizing your records.