Published at 21 March 2022

5 steps to organizing your finances

By Sylvie Tremblay

Organizing your finances can help you feel less stressed and more relaxed about your money – and more secure about your future.

Decluttering and organizing your finances can help you save money and track your progress. And help you feel more relaxed and secure about your finances.

“When you’re dealing with disorganization, you can’t pinpoint exactly where you are financially in your life, because everything’s in disarray,” explains Varsha Singh. She’s a Toronto-based professional organizer and the manager of operations and client care at ClutterBGone.

“We often find that clients are losing money because they’re paying bills late and paying interest that could have gone into savings,” she says.

Ready to roll up your sleeves and get started?

  • Use a budget calculator to help you manage your spending and understand if you’re falling short.
1. Sort and categorize your finances

It’s important to set up and maintain an organized system that works for you. That might be paper, digital or both.

Begin by sorting through your documents. Singh recommends creating broad categories to use smaller and more manageable collections of documents. Some suggestions:

  • bank, mortgage, and credit card statements
  • utility bills
  • contracts
  • important receipts
2. Know which financial documents to keep and which you can throw away

Next, purge. Singh says there’s an easy way to prioritize which documents to keep. Decide how difficult they’ll be to replace. For example, that signed mortgage statement is a must-keep. But the bank statement that you can download online is probably safe to shred.

Once you’ve sorted your financial documents, set up your storage system. Labelled hanging folders work best, says Singh. Store them in a filing cabinet or a 32-litre file box. You can find either at most office supply or home goods stores.

As new documents come in, drop them in the appropriate folder. Once you set up your system, you’ll be able to find any document you need in 15 seconds or less.

  • Want to prevent paper clutter from piling up throughout the year? Go paperless whenever you can.
3. Create a digital filing system

You might also have a handful of financial documents and bills hanging out in your inbox as well. But you can use the same organizing steps applied to your paper documents for your electronic ones.

Use folders and subfolders in your inbox or cloud storage to keep track of your financial documents. Try setting up inbox filters to help automate the process.

If you’re storing both paper and digital documents, be sure your filing systems match. That way you can easily find what you’re looking for.

4. Know how long you need to keep financial documents

Keeping your financial statements organized can be very helpful around tax season.

“Canada Revenue Agency says we need to keep financial documents for seven years. That’s why a lot of people feel they need to keep all their receipts and documents for that long,” Singh says. “But the reality is that if we need to keep our documents for seven years, so do financial institutions.”

Shred older documents that you could easily replace. Declutter old receipts regularly throughout the year, including at tax time. If the item is out of warranty or no longer returnable, throw out the receipt.

    • Which investments can reduce your tax bill?
5. Get help with your finances when you need it

Organizing your finances and setting yourself up may feel overwhelming. Don’t be afraid to ask for help from a professional.

Look for an organizer associated with the Professional Organizers in Canada (or POC), advises Singh. The POC sets ethical and training standards to ensure organizers can help you sort through your financial documents safely. That way, your information will feel manageable and secure.

You could take one more step, after you’ve got your paperwork and digital files in shape. You may find it useful to speak to an advisor to review your financial situation.