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October 9, 2009
Eight steps to address mess
Zlotnik seminar offers financial freedom through clutter-busting.
BAILA LAZARUS
Financial clutter-busters of the world, unite! You know who you are – the scared and the weary, constantly averting your eyes from the pile of envelopes – some opened, some not – and papers sitting on your desk, your filing cabinet, your bathroom sink, your dining table, your night stand. You know you'll get to them someday, but somehow that day never appears on your calendar.
Enter Lynne Zlotnik and her financial clutter-busting workshop that takes clutter-sufferers from chaos to clarity.
"We're taking a look at one part of a whole issue with money so you can position yourself to see 'Where I am,'" said Zlotnik at a workshop she held recently. "It's like going to a directory in a mall. In order to find a particular store, you want to know where 'You are here' is."
Zlotnik believes that financial clutter is actually a symptom of something deeper – a fear of not having enough money when we retire. Since we don't want to face that possibility, we procrastinate dealing with our financial papers.
But the cost of financial clutter can be huge, said Zlotnik. When you consider you might have cheques that have not been deposited, bills not paid or sources of money that you haven't followed up on, there's actually a financial cost in addition to the psychological cost of looking at the clutter every day and feeling overwhelmed.
One way to start, Zlotnik suggested, is to think of yourself as the chief executive officer of your own company and, therefore, to ramp up the level of seriousness with which you deal with the disarray.
"When you do take it seriously, you'll actually have fun," said Zlotnik. Well, I can't say I'm aligned with that idea; I've never had "fun" taking care of paper piles, but there's definitely a feeling of accomplishment and freedom afterward.
In order to address the mess, Zlotnik suggests following these eight steps:
1. Analyze
Before actually sitting down to the pile on your desk, make a plan. Decide what issues need looking after in your life and list the priorities.
"Ninety percent of our population is really close to financial disaster because they haven't sat down and said, 'This is where I want to go' and then planned how to get there," said Zlotnik.
2. Strategize
Write down your financial goals and then bring together the pieces of information that you'll need to follow up on them. If that information is "somewhere" in the clutter, that will give you more incentive to get down to work.
3. Attack
Take action. Set aside a specific date and time. Mark it in your agenda if you have one. Ask a friend to call you during that time to make sure you have started on the pile.
4. Sort
Ask yourself the same questions for all the documents in front of you: Do I need this? Do I want this? Is it important? Remember that, for tax purposes, you should keep documents at least two years; self-employed people should keep documents seven years.
5. Purge
Keep the recycling bin handy so you're not just taking a piece of paper you don't need and putting it on another area of your desk or on the floor. Anything with personal information such as a social insurance number, credit card number, etc., should be shredded.
6. Assign a home
Buy a box of manila folders and start labeling them. If you have a folder that says "hydro bills" there's a better chance you'll actually file the bills away rather than leaving them in a pile on your desk to be taken care of later. At a moment's notice, you should be able to put your hand on any piece of paper that you need.
7. Containerize
Once you have your files, set up a system. Use cabinets, shelving, whatever you have at your disposal. Make these files a priority so they don't get dumped into a fancy wicker basket that ends up with children's toys on top of it.
8. Equalize
Aim for equilibrium. Handle every piece of paper once only. Open the envelope, pay if needed and then file. Have current papers and files at your fingertips.
Zlotnik suggests getting a personal filing system, such as the Personal Finance Key Document Filing System for Dummies (which she gives to participants as part of the cost of the workshop). It breaks down your important papers into key areas such as investment accounts, pension plans, insurance papers and credit documents. Each section is further broken down into subsections, such as vehicle insurance, life insurance, etc., and has time-saving tips and "ask an expert" advice.
Even if you don't have all the documents ready that would normally go into this type of filing system, it's an excellent way of seeing the gaps in your financial planning, according to Zlotnik.
In addition to going over the steps of clutter-busting and running through the financial filing system, Zlotnik offered advice on tax-free savings accounts, wills, mortgages, life insurance and credit cards.
"If you read the books the millionaires write, you'll see they don't have a Holt Renfrew card," she said. "They might have a Sears card. They're very frugal."
She also ran through a list of what you should keep in a safety deposit box, such as birth and death certificates, mortgage papers, wills, leases and life insurance policies, just to name a few; and provided a list of reference books to go along with the workshop that included Getting Things Done by David Allen, Organizing from the Inside Out by Julie Morgenstern and Smart Women Finish Rich by David Bach.
Zlotnik is often coming up with new seminars around financial planning. She currently runs a Lunch and Learn series and will be presenting Tips, Trends and Takeaways: Savvy Marketing Advice for Women, with Mary Charleson, president of Charleson Communications and a regular columnist in Business in Vancouver. It takes place Monday, Dec. 14, 12-1:30 p.m., on Granville Island.
Baila Lazarus is a freelance writer, painter and photographer. Her work can be seen at orchiddesigns.net.
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