The Definitive Guide to Getting Financially Organized

Let’s be honest with ourselves for a moment.  We can’t put it off any longer. We know we all need to get our financial lives in order, but like so many of us, maybe you just aren’t quite sure where to begin.

Between your unpredictable schedule, student loans, and bills coming at us every day, it’s tough to stay on top of everything. How can you possibly begin to get your financial life in order when your medical career is dominating your life right now?

The answer is simple. One step at a time.

Today, we are fortunate to have tools to help simplify the elusive process of getting organized. I’ve also learned multiple strategies from helping my clients navigate through finances over the years. 

There isn’t any secret formula or quick fix. It’s a step-by-step approach to help you organize your thoughts, so you can organize your finances. 

Use this guide to help you understand the items you can do today, which will ultimately set you up for financial success tomorrow. Hopefully, you’ve already knocked a few of these items out. If you’re just getting started, then this will be even more helpful.

Start With Your Banking Structure

Most people assume as a physician that your finances are a cinch to manage. With your above-average salary, it has to be pretty easy to keep up with your cash flow. How hard could it be, right?

But no matter how much we have coming in, it takes intentional actions to make our money work for us. Hopefully, by this point, you’ve established a personal budget and created your financial goals (if you haven’t, then be sure to check out our posts to help you get started). But let’s take it back even further and start with the very basics – your bank accounts. 

At the most basic level, we can set up our bank accounts for financial success. What if I told you there were simple, actionable steps you can start taking today, which will help streamline your finances?

Banking may seem like the least exciting way to help pave your way to financial success. After all, how can a gigantic, impersonal,  brick, and mortar institution help you achieve your personal financial goals?

You might be curious about how banking is even tied to financial success. You’re just depositing money in and taking money out of an account. It doesn’t seem as if there would be anything else to think about.

Believe it or not, you can use a bank account strategy to make your finances run smoother. I’ll go out on an even bigger limb and say it can make your life a little bit easier.

Let’s be honest – many financial experts focus on creating the actual budget. And yes, a budget is extremely important and I believe it’s the critical component needed to succeed. But we also need to spend time discussing the structure and organization of your expenses.

Part of getting your finances organized means getting your banking organized too. It’s time to put together a banking plan which helps you succeed. Let’s take a closer, in-depth look at some of my favorite tools you can start using for financial success.

Establish a Primary Bank

The very first action item to set up your banking for financial success is to limit the number of banks you have to deal with. Over time you’ve probably used various banks since you’ve moved cities, changed jobs, or changed your relationship status. It’s time to make your life easier and have one primary bank.

Part of getting yourself organized is to simplify your banking. Ideally, you should use one primary bank for your checking account and possibly your savings accounts, too (we’ll discuss savings separately).

Use a Primary Checking Account for Household Expenses

The next step, once you’ve identified the primary bank you want to use, is to set up your primary checking account. Most likely you’ve already started this process, but if you’ve gotten married or moved then perhaps you have more than one account which your household expenses are coming out of.

A primary checking account should be used for all of your household bills, payments, utilities, and subscriptions. Pretty much all expenses, other than savings, should be deducted from your primary account.

You should have the majority of your earnings deposited into this primary account too, while all expenses are going out. It really is quite simple. Your money comes in through the primary, and your expenses go out through your primary.

You may be tempted to have several checking accounts to pay for various things because of the incentives which sometimes come along with opening an account. Trust me, the $100 bonus you’ll receive will not be worth the hassle of keeping up with one more bank. Not to mention the time it takes for you to transfer money over in order to cover a bill you forgot was coming out of this other random account.

Combine Your Accounts with Your Spouse

One of the first items you should take a look at is the number of accounts you have. You might think it’s easier to have separate accounts from your spouse. You may feel as if it provides you a little independence. Truthfully, you could be doing yourself a disservice. 

Combining your accounts with your spouse isn’t the easiest of topics to discuss. There’s no shortage of opinions on the matter among personal finance gurus either. But why is the topic of combining finances so uneasy for some people?

While it may seem like a simple decision, it’s not as easy for some people to adjust to the thought of one account. For some, it may feel as if your spending is being “monitored” or as if you have to ask permission for spending on an item you want or need. You and your spouse probably handled finances completely on your own prior to getting married.

If you’re married, consider all the decisions you have to make together as a couple. Many of these decisions involve finances (whether we like it or not). It’s complicated enough without having the added pressure of discussing who is going to pay for a certain expense.

But combining accounts doesn’t have to be a negative experience. I think it’s an important step in the process of getting organized.

Combining Accounts Saves You Time

Combining your accounts can help streamline your life. Do you really need one more account to keep up with? I know I can barely remember to grab my cell phone and keys as I head out the door each day. Having separate accounts and tracking who pays for what just adds more time and energy to keep up with finances.

If combining accounts is still a hot button topic among the two of you, then set up a time to check-in and have a regular discussion. You could also set expectations up in the beginning. For instance, you can establish guidelines such as not having to discuss a purchase as long as it’s not over $100. Or you could establish a category of spending for fun money.

However, you decide to do it, combining your accounts is an important step to getting the two of you on the same financial page. And remember, it’s not locked in forever. You can update your “guidelines” for the account as you evolve as a couple.

Know-How Much (and Who) You Owe

Facing debt head-on can be one of the most overwhelming steps to understanding your financial picture. This is especially true for physicians who are averaging hundreds of thousands for student loan debt. But to get organized, you have to know exactly what you owe. 

To establish a strategy to pay down debt, you have to look at it line by line. You may think you know the exact amounts or you’ve been afraid to look at your statements in detail. Either way, take the time to get the exact numbers on paper.

Student Loan Debt

The first step is to write down what you owe for student loans. Many of you owe a combination of private and federal loans. You are probably so used to paying the minimums each month – or using a deferment –  you’ve lost touch with how much you really owe.

For federal loans, you can log in to to enter your login information. From there, you will be able to see exactly what you owe in federal loans. If you are on a deferred payment schedule, you will be able to see the dates you have to begin paying. 

For private loans, to confirm your accounts you will need to pull the most recent copy of your credit report. Not only is this a perfect opportunity to confirm, but a chance to monitor your credit report for information. 

Remember, you’re entitled to your credit score as well.

Other Debt

Once you’ve identified the student loans, it’s time to move onto any consumer debt you owe. Make a list of any and all other debt – this could be personal loans, lines of credit, credit cards, car loans, and/or friends and family members. It’s possible you’ve amassed quite a bit of consumer debt along the way.

List out each debt and list the interest rate and the amount you owe. Make notes of any special circumstances surrounding the repayments or conditions. Put it all on paper so there is no misunderstanding of how much you owe.

What to Do With Your Debt

Now that you have established exactly who and what you owe, your head is probably spinning with ideas on where to go from here.

There are several strategies in particular with student loan debt. You now know how much you owe for private loans, so it could be time to consider refinancing.

One of my favorite resources for refinancing student loans is using to compare offers from lenders. is an easy resource to use to help you compare interest rates. You will know very quickly whether or not you can save money by refinancing your private loans.

For your federal loans, you may have several repayment plans to choose from, each with their own pros and cons. 

If you’re not sure what the best strategy is for your debt repayment, this could be a perfect time to speak to a fee-only financial advisor. A fee-only advisor (especially one who works with physicians) can guide you to the best repayment plans for your situation. 

The bottom line is, in order to figure out your debt repayment strategy, you have to know exactly who and what you owe. Getting this information together is essential to help organize your finances.

Defining Short-Term and Long-Term Financial Goals

When you chose to become a physician, most likely it was after establishing specific goals for yourself along the way. You set your sights on making the highest grades, attending a certain undergraduate school, and then finally being accepted into your medical school.

You didn’t get there overnight. You had to make sure you hit clear checkpoints to get to where you are today. It’s the same strategy with our financial goals. We have to figure out what financial milestones we want to hit, both in the short and long-term.

It sounds almost too easy but taking the time to write out your short-term and long-term financial goals is a pivotal point to getting organized. Not only does it help you get your thoughts on paper, but it’s the critical first step in setting up your budget.

Short-Term Goals

Examples of short-term goals could be paying off a specific amount of credit card debt or student loans by a defined date. It could be as simple as increasing your retirement account contribution by one or two percentage points. Another goal could be to establish and maintain a monthly budget

You will probably find it pretty easy to set up several short-term goals. After all, how many times as we reminded ourselves we “should be doing something” or “we need to start doing X, Y, Z.” By putting your short-term goals in writing, you’re holding yourself accountable. It’s a great first step to help lead you to think about what you want to accomplish with your finances.

There’s an added bonus too. By creating short-term goals, you are setting yourself up to be able to establish long-term goals.

Long-Term Goals

Long-term goals can get a little trickier. This is where you may have trouble articulating or defining what it is you want to do with your money in the next several years. Sometimes it’s hard to know where you will be in the future – perhaps getting married, having children, buying a home – there are many unknowns. 

And as physicians, you know you have a salary increase in your future (if you haven’t already) but it’s hard to understand how you will be impacted by this when you’re living on a rice and beans budget during residency.

But it’s important not to let the unknowns derail your long-term goal planning. There are several items you can tackle which will almost always be beneficial to you under any circumstances. For instance, paying off student loans within a defined number of years. Saving up a sizable down payment for a new home. Having clear benchmarks for retirement savings as you hit your milestone birthdays. All of these are ways you can assign real action to what you want to achieve.

As your life changes your goals will certainly change too. It’s part of it and there’s nothing you can do about the changes. The important thing to remember is the act of writing down your goals means you are doing something. You are giving yourself something tangible to work towards. 

I Need Help Defining My Goals

If you are still struggling with how to define your goals, then here are three questions I like to ask my clients:

  1. Where are we right now?
  2. Where do we see ourselves in 5-10 years?
  3. Then focus on a smaller bite of time (a stepping stone): Where do we want to be in three years?

Starting a conversation with your spouse (or yourself) using these three questions can help you define a real answer. Try to avoid vague answers to these questions, and put down specific, meaningful ideas which you will be proud to work towards.

By creating goals for yourself and writing them down, you will be well on your way to getting more organized with your finances. More importantly, you will know what you are working towards. Your money will begin to have a clear purpose.

Create a Budget You Will Actually Use

If you’ve listened to my podcasts or read any blog posts, then you know my love for talking budgets (and if this is your first time to my site – welcome!) Budgets are so important for financial success. Think of it as a tool for helping you set your financial goals in motion.

Many of you reading this right now may be tempted to skip over the “Budget” section. But stay with me here, there are multiple ways of creating a budget that will work for you, your family, and your situation. I don’t subscribe to a one-size-fits-all approach.

Start with Your Goals and Priorities

Remember earlier when I advised you to write down your short-term and long-term goals? Here is where the information will shape your budget.

The problem with budgets for most people is they fail to capture the goals and priorities you are working towards. But since you’ve established your goals already, you can make sure your new budget reflects what you’ve identified as important.

In addition to the short and long-term goals you’ve named, you want to put thought into your priorities. What are the things which make you happy and you would like included in your spending or saving? It’s ok if you aren’t currently able to spend money on these items. Go ahead and identify what you would like to incorporate into your financial plans.

Name specific items that bring happiness and joy and you would like to find a way to fund. Examples of these items could be the annual beach vacation with your family, your weekly trips to the coffee shop, or your passion for gardening. Perhaps you’re looking for a way to incorporate more charitable giving in your financial plans.

No one can tell you what you have to spend your money on each week. It’s important to create a budget where you are allowed to spend money on items that mean the most to you.

Review Your Spending

Now that you have your goals and priorities clearly identified, it’s time to review and analyze your current spending. 

Take one month (starting as soon as possible) and write down every expense coming out of your account. And by everything, I mean everything. No expense is too small to be included. You can complete this step by setting up a spreadsheet, downloading an app, or using pen and paper. You can make it as high (or low) tech as you wish. You want to be able to capture, record, and assess this information quickly.

After you’ve recorded everything for a month, go ahead and make another section for known expenses that don’t always occur every month. These are the items that you know you have to pay on an annual, semi-annual, or quarterly basis. Items like insurance premiums, HOA dues, Amazon Prime membership, or school registration fees are all good examples of this type of expense.

The Review and Ranking

You now have all of your financial goals and your expenses in one place. It’s time for the analysis. This will either be your favorite part of the process or the most frustrating. But remember, you can’t make any changes if you don’t face the facts head-on. 

You are going to assign a category next to every single expense you had throughout the past month. You will also do this for the items you identified as occasional expenses.

In the same manner in which you accounted for every dollar you spent within the month, you need to assign a category to every single item. The categories could be mortgage or rent, credit card debt, student loan payments, and eating out to name a few. 

It’s ok to get creative with your category names. Don’t worry if it seems like you have too many different categories right now. The important thing is to assign every expense so it can fall into one of these buckets. Avoid using the “unassigned” category – every item falls into some type of expense.

Once you have everything identified, it’s time to rank your categories. Refer to your list of priorities and arrange the categories from top to bottom, based on your priorities. For example, you will probably have rent or mortgage at the top because it’s important to pay those on time and you don’t want to live on the streets. You may find you have a new cell phone at the bottom of your priority list, even though you have a large bill you have to pay each month towards a plan.

Easy Formula to Use for Budgeting

Now that you have your expenses identified, you can start to establish how much spending you should have for each category. If you ranked something really low or high, make sure it’s correctly reflected in your spending.

Sometimes we need a little extra help to know if we are on the right path with our budget. One of the questions I receive the most from clients is exactly how much should go towards the broad categories. An easy formula to provide a few guidelines is this:

  • 50% of your take-home pay should go towards fixed expenses
  • 25% should go towards variable expenses
  • 25% of your take-home pay should be used towards savings

Think of your fixed expenses like your mortgage or rent payments, insurance premiums, utilities, and other items that you have to pay on a monthly basis. 

Variable expenses are items that you know you have to pay regularly, but you don’t always know the exact amount. For instance, dining out, gas, and groceries are typically variable expenses. 

Overall, you want to create a budget that covers all of your important expenses, reflects your priorities, and helps you achieve your financial goals. Once you’ve created this budget, ask yourself if it’s helped you with these areas.

Establishing a budget can seem overwhelming, and frankly, it takes quite a bit of motivation to get it done. But once you’ve established your budget, you will have truly taken a step in the right direction to organize your finances. You really can’t achieve your financial goals without knowing where your money is being spent and telling each dollar where to go.
Setup Sinking Funds

Once you have created the budget which works for you, there is one more step to help automate your process even further. You can use sinking funds to help you manage your expenses so an unexpected home repair or a trip to the emergency room doesn’t ruin your budget.

I personally like to use sinking funds for my own budgeting purposes. I also advise clients to do the exact same thing. It allows you to set aside money so you can be prepared for the bigger expenses we inevitably get hit with.

What is a Sinking Fund?

A sinking fund is simply an account you set up and contribute to for a specific expense. You usually contribute to a sinking fund by depositing a certain amount of money on a consistent basis. 

For example, you could have a sinking fund for holiday spending. If you know you spend $1000 on gifts each year, then you could create a sinking fund and deposit $41 from your bi-weekly paycheck. Then, when the holidays roll around, you can withdraw the cash you’ve saved and spent it accordingly.

Sinking funds are a perfect way to help keep your budget on track. It also helps keep your spending in check if you tend to overspend. Are you worried that having multiple sinking funds will be too difficult to manage? With today’s online banking, it makes it super easy to set up these accounts. You can label them with any name you like. You can also set up automatic transfers so the money comes out when it’s best for your budget. 

You don’t have to limit a sinking fund to emergencies either. You can use them to set aside dollars for vacations, kids’ activities, or new golf clubs.

Make your life (and finances) a lot easier by setting up sinking funds. If you want to organize your finances, then making sure your money is allocated to a specific account will help you stay within your budget.

Negotiate Your Way to Lower Expenses

Whether you’re barely scraping by or have money left over each month, one financial truth remains the same. You shouldn’t overpay for items when you don’t have to. 

It’s easy to overpay for our services. As busy physicians, it’s hard to find time to sit down to analyze places to save. But it really doesn’t take a lot of time to find quick, painless ways to cut down on expenses. One of the best ways is by negotiating your monthly rates for services.

List Your Obligations

Grab your list of expenses that require you to sign a contract or automatically come out of your checking account each month. Examples of these are insurance premiums, cell phone service, satellite and cable service, and so on.

Pick one or two services to start with (or better yet, set aside a few hours in one day) and start calling. If you have a specific agent you can contact, then send an email or call. Let them know you are shopping around for prices and you want to find ways to get a more competitive price. You can go through your detailed billing and you uncover hidden expenses you didn’t even realize you were paying for.

Once you have lowered your expenses, revisit your list of goals and priorities. Can the additional $25, $50, or $100 you’re saving go towards something else you identified? How much of a difference would one of those amounts make towards paying off your debt each month? 

Analyze Your Subscriptions

Let’s take a moment and talk about subscription services. These are the regular-scheduled items that are automatically deducted from your account and magically show up on your doorstep each month. There’s a subscription for everything you can think of, but it’s definitely not free. 

If you want clothes, music, dog food, skincare, or toys delivered on a regular basis, then there is a subscription service for it. Make sure you are accounting for this in your monthly spending. Two or three subscriptions can start to add up and make a dent in your spending.

I personally don’t think all subscriptions are budget-busters. If it’s an item you use and it saves you time, then it’s probably worth keeping around. 

However, if you’re looking for a quick way to cut down on expenses, then cutting out your subscriptions may be a painless way to cut back. Plus, you can usually do it right online, which makes it even easier to organize your finances.

Between lowering your monthly bills and cutting out unnecessary subscriptions, the money you save can add up quickly. Soon you’ll be able to put more towards your goals and help fund the items you ranked high on your priority list.

Decide Where You Need Help

You may think when you organize your finances and establish a budget it automatically means cutting out all extra spending from your life. It actually means the opposite. It’s deciding on what takes priority in your life and you are pointing your money towards your priorities.

Along with cutting down on expenses, you need to decide what is worth paying for and brings value to your life. What may seem frivolous to some people, could be essential for your household.

An example of this is if you need additional help on the home front. For instance, if you work irregular hours (not uncommon since you’re on call all the time and work crazy hours) then you can’t keep up with a normal cleaning routine. It could be helpful to you to have a regular cleaning service so you’re not completely embarrassed when someone drops by.

You might need help with landscaping, additional child care options, or paying a little extra for grocery delivery. The point is, you have to decide where you could use extra help so you can be a better spouse, parent, physician, or whatever you want to accomplish.

Another area that could use extra help could be with your finances. Hiring a service, such as a fee-only financial advisor, can help you organize your finances. A fee-only financial advisor helps you pinpoint your goals and works with you to make sure you’re working towards them.

Part of getting organized with finances is deciding what service brings the most value to your life. If something costs extra but saves you time or allows you to work smarter, then it’s probably worth keeping.

Financial Apps Can Help You Achieve Your Goals

If there’s one thing I love its technology to help make our lives easier. Can you even imagine your life without a cell phone these days? Or how long everything took to get things done before personal computers came along?

Fortunately, there are several tools to make it easier to organize your finances. No, they may not be as ground-breaking as a cell phone or personal computer, but there are several apps and websites which make your daily financial life just a tad easier.

Tiller Money

I’m a big fan of  Tiller money. I use this service to track all of my monthly expenses. It’s a way to look at your budget every day in a google doc. If you’re worried about spending too much time trying to figure out how to create a budget, don’t worry. There are templates you can use and you can see examples of what other people have put together.

If you’re looking for a way to track your expenses but something which is responsive to your goals, then you should try Tiller money.


The Acorns app is a fantastic option for those of you looking to start small with investing. It’s free to download, but there are paid plans you can try as well.

You link your bank account or credit card. You then authorize the app to round up your daily purchases. Those bits of change are used to buy shares in investment funds of your choice. The idea is the little acorns of savings will grow to become a mighty oak one day.

This is a great option for those who don’t have a lot of extra to set aside. You can use this to establish your emergency fund, fund your holiday shopping at the end of the year, or just get in the habit of investing – you will be able to find a good use to put the money towards.

TD Ameritrade

If you’re uneasy about letting apps and websites having access to your financial data, then check out TD Ameritrade. Or if you consider yourself to be beyond the beginning stages of investing, then TD Ameritrade is a good choice.

With this site, you will be able to make small investments and trades or you can go even bigger. You do have to set up a minimum of $2,000 in your account. Again, this isn’t ideal for beginners but it’s a good way to ramp up your own investment strategies.

Contributing to Retirement

As physicians – after the long years of education and training – you’ll be primed to potentially earn a very high income. This will put you in an advantaged position to begin to save for retirement (if you haven’t started already). Once you have your budget established, you need to carefully review your retirement savings plan.

Saving for retirement has two benefits: the first and most obvious is being able to set you and your family up for an excellent future. As much as you love practicing medicine, you may not envision yourself practicing into your 80’s.

The second benefit saving for retirement provides is the tax benefit. You will need all the help you can get to reduce your tax burden. Saving for retirement is a great way to accomplish both savings as well as reducing the amount of tax you might have to pay.

Saving for retirement through work

If your place of employment offers a retirement contribution option, then you need to research and begin contributing as soon as possible. 

You may be fortunate to have access to a pension through work, but a pension plan is becoming less and less common. There’s a good chance your hospital provides a 401k or 403(b) plan. Even if you don’t have a company match, it’s important to take advantage of the account.

One of the biggest benefits of saving through your workplace is you will never miss the money being set aside. It’s hard to miss something you never see! You will lower the amount of taxable income for the year and you will grow your nest egg at the same time.

If you haven’t begun contributing to a workplace account, then take a few moments to complete the paperwork. You can start with a very small percentage and work your way up as your salary increases.

Other Ways to Save for Retirement

Working with a fee-only financial advisor can help you establish a clear savings plan. There are several other ways you can beef up your savings while reducing your taxes. Working with a professional can help you figure out which type of savings could benefit you the most. You will find out if you could possibly benefit from different IRA accounts or certain real estate investments, for example.

Refer back to your list of long-term goals and priorities. Where did saving for retirement rank on this list? It’s tempting to put off saving for something which seems so far in the future, but it’s true that starting as early as possible will yield you the most benefit.

Checkups For Your Policies

It’s hard to organize your finances without talking about a couple of big items – long-term disability and term life insurance. Physicians are in an especially unique position of needing these two items as soon as residency has been completed (if not sooner). When you find yourself trying to get organized, you definitely want to take time to review these policies.

Disability Insurance 

Here at, we spend a lot of time discussing time to review.

Once a year, you need to sit down and go through your policy details. If you’ve experienced any big life changes, then you might need to update your policy. Moving out of state, changing practices, and having children are all ways your policy could be impacted.

There are many riders which you can adjust without having to go through any medical underwriting. All these changes can impact the cost of your disability insurance

Evaluate Your Term Life Insurance

The same is true for your term life insurance policy. You want to visit the policy once a year to make sure it still provides the coverage you need, should the worst happen. If you’ve had children or paid off your mortgage, then you will need to adjust your policy.

As you get older, your term life insurance can be adjusted. If your children are finished with college and you have set aside a significant amount in savings, then it’s time to discuss how much term life you really need. Hopefully, when you’re older, your savings accounts will be well-funded. This will free up money for you to spend on other items besides term life insurance. 

It’s easy to let disability and term life insurance fall to the bottom of the list of priorities. You hurry and get your policies set up and then forget about them as life happens. Disability and term life insurance may not be the most exciting topics to go through each year, but they are important to physicians. Go ahead and add it to your calendar to review each year.

If you’re concerned you may be paying too much or you might not have the right coverage in place, you can use a service like to help. This website has several resources for information on life insurance (and other products). You can also get free quotes and compare rates side by side.

What Happens When You Aren’t Organized

The tips provided here are designed to help you organize your finances. The intent of all of these is to provide you with clear, actionable steps you can take to move your finances in a positive direction. It’s not going to happen overnight, but little by little, it will happen. Many of you know reading this know you should be taking steps to be more proactive with your finances, but it’s hard to know where to start.

Have you stopped to ask yourself what happens if you continue to leave your finances unorganized? If you operate on a strategy of hope that one day you’ll get it figured out?

When you aren’t organized, you waste a lot of time and energy. Think of the number of times your thoughts race through your mind when it comes to finances. Think of the amount of energy you waste feeling guilty because you haven’t set up a particular account or paid off a certain bill.

When you aren’t organized you end up wasting money. You could waste money by overpaying for a service you could negotiate down or paying a late fee on a missed payment.

When your finances are organized, it frees your mind up to focus on other areas of your life. When you know that every dollar of your paycheck is being accounted for, you can spend your time focused on improving other areas of your life. As physicians, you’re often so focused on your patient’s lives that you forget to focus on yours.

Organize Your Finances – The Rest Will Follow

We all know money doesn’t define who we are. But like it or not, it’s a big part of our lives. Getting your finances organized means gaining control over a major aspect of your life. I’m excited to share these tips with you because I personally know how rewarding it is to accomplish these items.

Hopefully, you’ve already started on these in some form or fashion. But if you haven’t, then there’s no better time than right now to get started.

Once you’ve organized your finances, why not try to simplify them and remove some of the unnecessary complexity.

How to Simplify Your Finances

We could all use a little more peace and simplicity in our lives, right? But, how much peace do you really want to experience? Could you perhaps save a little bit more for that vacay you’ve been wanting to take for a little breather? Could you maybe simplify your finances to help you save?

Computers, phones, and apps were developed with the intention of making life easier, yet somehow, they seem to have added to the clutter. Only now, we have virtual clutter in addition to the actual things lying around our personal space. It has become easier than ever to get bogged down by the details, and buried in the many options available to use throughout our daily lives, making the achievement of our ideal life just a little bit harder.

If you have ever created a vision board, you might be familiar with the basic approach, which is that you look through magazines for pictures of anything that makes you happy and brings you joy. When you put those things together on a piece of poster board, you will have unintentionally created a vision of the things most important to you. The idea is to use this board to spark creativity and to help you focus in on what really matters to you in life, and filter out the noise.

This concept works for financial visions, as well. Consider this article your primer for creating a financial vision board. Ask yourself what parts of your life make you happy and bring you joy? Is it the daily latte you pick up on your way to work every day? Or those fabulous new shoes? Is it putting a bit of extra money towards your emergency fund or discovering a new mutual fund you might want to learn more about?

Only you can decide what truly brings you joy.

Clean out your filing cabinet

If you’re anything like me, you still have an actual filing cabinet with real paper in it. It probably weighs a ton and you likely never open it, let alone need any of the paper. Once a year, go through your filing cabinet and clear out the clutter. You will likely have a stack of paper that you don’t need to keep that can go right into the shredder.

Create a budget

It’s not uncommon for people to think that a budget equals restriction. In reality, a budget equals freedom. The more you know about what money comes in and where you send it out, the more mindfully you can make decisions. This leads to a feeling of empowerment!

Pay cash

Try this for a week: take the money you have budgeted as discretionary income and the money you have budgeted for gas and groceries. Put each amount in a different envelope. Put those envelopes in your wallet. Use that cash to buy food, gas, and incidentals throughout the week. This keeps you from overspending and helps curb impulse purchases. The peace of mind you develop from spending only what you know you have far outweighed any rewards points you might gain from using credit cards.

Increase your retirement contribution

It’s unlikely you will miss one percent of your paycheck. If you earn $50,000, one percent is $500. That’s a lot of money all at once, but distributed into 26 payments (assuming you are paid biweekly, 26 times a year), and it’s only $19 and change per paycheck. Contribute that money to your company’s retirement plan, and you are saving pretax dollars. This reduces the amount of income tax you will have to pay over the course of the year.

Up your retirement savings by 1%

If you’re lucky and get a cost of living increase, it’s likely around 3-4%. If you move 1% to your retirement fund, you still get a raise in your paycheck, you won’t miss the extra 1% that you never had at your disposal anyway, and now you also have more going to retirement. This is a way to save for retirement without feeling any pain in your budget.

Check your credit history

The three major credit bureaus allow you to check your credit once a year for free. Make sure you take advantage of this. Remember that knowledge is power. More than likely, checking the three reports won’t produce any surprises. But if they do, you’ll be able to jump on that sooner rather than later and have any issues corrected.

Use just one credit card

It’s easy to fall into the trap of using credit cards as your Credit cards are necessary and advisable sometimes (for example, there are insurance benefits with some cards when you book travel with the card), but always treat them like cash. Use one card, and then log into your account and transfer payment from your checking account right away. You won’t regret staying on top of your credit card bills.

Call your utilities and service providers

Once a year, call your cable company, internet service provider, and phone company. Ask them what new rates or promotions they are running and if you can participate and take advantage of the lower rates. Be honest and polite. Tell the customer service rep that you are calling to see what options are available to lower your rate. You might be placed on hold a bit while the rep determines what he or she can offer you, but the 10-15% savings you will likely net from the call make this an hour well spent.

Call your insurance provider

Your next phone call should be to your insurance provider(s). Most insurance products can be bundled together under one account for a discount. While you’re on the phone, ask them what options are available for you to save money on your plan(s). It can be worth it to place a call or two with a competitor in advance of this call so you armed with the knowledge of what insurance levels and costs are competitive and then ask your existing provider to match them.

Start a fitness plan

Note that I did not say to sign up for a gym membership. Exercise is cumulative, so every extra flight of stairs you scale, every walk you take, every sit up you do add up to contribute to your overall feeling of wellness. The better you take care of your physical health, the better able you are to care for your financial health. You will make better decisions, enjoy better health (and fewer medical bills), and have a clearer, more mindful outlook.

Drink more water

This goes hand in hand with the need for a fitness plan. Water is perhaps the most important substance that your body needs. Staying hydrated and refreshed helps clear your head. A clear head leads to sound financial decisions and greater happiness. Plus, water is free.

Cut services

Do you really use that cable bill enough to justify the expense? If you use a streaming service like Netflix or Hulu, and if you have a streaming box, like a Roku or Apple TV, you likely have all the programming at your fingertips that you could possibly want. Subscriptions to a streaming service give you more control over what you watch, without forcing you to pay for the 75 channels that you never watch. If you find you miss cable, you can always re-subscribe, and will likely score a low new or returning subscriber rate.

Cultivate peace

A cluttered home or office is often a sign of a cluttered life. Work on removing that clutter. Make it a habit to recycle your mail on a daily basis, clean out your closet, and donate the things you truly don’t wear. Purge the shoes that hurt your feet. Sort through that pile of stuff that accumulates on the kitchen counter. You know which pile we mean.

Automate a small investment

Start by doing a quick web search for reputable investment firms (or automated investing). Set it up so that $50 a month goes into this account. Then, forget about it. You will not miss an extra $50 a month, I promise. Over time, that automatic monthly contribution will add up to a nice little bonus savings account.

Have fewer goals

How many people do you know have lots of side projects happening all of the time? They get pulled in so many different directions that they aren’t able to focus on any one of them for any length of time. As a result, they are a jack of all trades but a master of none, and are tired and distracted to boot. Instead of the “fire, aim, ready” approach of trying lots of different side gigs and hobbies and projects to see what sticks, work on the “ready, aim, fire,” approach instead. Really consider how you want to spend your time, and know that it’s okay to have – and enjoy – free time.

Stop looking at screens

For the love of all things sacred and holy, stop staring at screens all day long. Did you know that the average American looks at a smartphone for more than half of their waking hours? Think about that for a moment. Think about all of the things you could do with your time if you weren’t staring at a screen. Go outside. Take a walk. Read a book. Pick up a pen and draw or doodle. Give yourself the opportunity to get bored. See what comes of it.

Reduce subscriptions

Subscription boxes are all the rage right now. It’s like getting a present in the mail every month, and who doesn’t love to get presents? The catch with these boxes is that they are impulse purchases in disguise. They make it easy for you to return the items, but they also know that most people won’t. It’s easier to hang on to an item in hand and to rationalize keeping something we don’t really need than it is to send it back. That $30 here, $15 there, adds up quickly to a closetful of stuff we don’t really need, and money spent that could have gone to something we wanted more.

Pay bills online

But keep getting the paper statements. It can be too easy to miss one email or calendar alert among many, so paper statements that you have to physically shred and recycle once you have paid the bill can help keep you on track. But save yourself a stamp and the possibility of payments getting lost in the mail and racking up late fees by making payments online with a credit card (that you will then immediately pay off by bank transfer, right?).

Use target-date funds

Many people think that investing requires research and experience and education, when in fact, investing is as simple as setting up a recurring payment in a money market account. The bigger investment firms (think Vanguard or Fidelity) have solid reputations and a great variety of funds to choose from. Most of the bigger investment houses have what is known as “target retirement date” funds. Choose the bracket that targets the year when you will most likely retire. For example, if you are 30 years old and plan to retire at age 65, choose the 2050-2055 fund. It’s balanced to become more and more conservative the closer to retirement you get.

Consolidate your bank accounts

Stop banking here, there, and everywhere. It’s easy to lose track of your finances and a bit maddening to log in to various places all the time. Plus, you consolidate what little interest you earn by keeping money together. Some banks give you higher interest rates on larger balances, and every penny earned adds up. Many financial institutions will consider your money forfeit if the account has been inactive for a set period of time. Don’t give away your money.

Pay someone else

Sometimes, you really do have to spend money to make money. There are a few areas in life where hiring a professional can actually create a budget, an investing plan, and a plan to attack your student loan debt. Depending on your situation, it might be worth the time back in your life to hire a landscaper to tend to your lawn and garden, or even a professional organizer to help work through the clutter in your home.

Stop signing contracts

If you would like your fitness plan to include time at a gym or fitness center, do not worry. There is room in a simplified financial life to enjoy these things. One strategy is to seek out fitness centers that charge per class. They typically offer a discount for classes bought monthly in bulk. Check your local adult education or community center for low-cost fitness classes. Your local community college or hospital likely offers low-cost classes on a seasonable basis as well. This way you can try new things, and spend much less than you would on a traditional gym membership.

Something in, something out

For every new item you bring home, plan to throw out, recycle, or donate one item. Or, go crazy and eliminate two items per week. Adopting a more mindful approach to the acquisition of things will help you simplify your choices and save money without even trying.

Think used

Embrace the concept of a used car. This is a tough one for many people because a new, fancy car is often associated with prosperity. Once you let go of the car as a status symbol, the effect is very freeing. You will revel in the money saved from the high cost of premium gas, more expensive parts and labor on repairs and maintenance, and higher insurance premiums, not to mention the money you’ll save on the monthly payments alone.


This is a tough one, but a very important tip: be mindful of where you get your financial advice. Everyone you ask will have an opinion on how to save money, how to spend money, what you should do to earn more money, and so on. You will get a lot of noise this way. Filter it out by discussing financial matters with a select few trusted associates.

Make checklists

If there’s one thing that is certain is the end of the year can be quite busy. Between all the year-end parties with the staff, friends, and family, the calendar quickly becomes full. There are several things to look forward to during the holidays, which means finances naturally take a back seat.

But the reality is, the end of the year is the ideal time to perform a financial checkup. And this year, we’ve tried to make it easier than ever for you to make sure you have everything covered. Ending your year with a thorough examination of your own finances will maximize your potential for earnings in the next year. 

17 items to take care of may seem like a giant task before the end of the year. But your finances deserve the same amount of attention that you would give to other important tasks throughout the year. Don’t look at this as a must-do list right this moment. Instead, use it to guide your next steps in your financial journey, as well as see how far you’ve come this past year. 

1. Examine Your Financial Goals

If you’ve hung around Financial Residency for a while – or if you’re brand new – you will hear me talk quite a bit about establishing financial goals. If you haven’t had an in-depth conversation with yourself or your spouse about what you want to achieve with your finances, then now is the time.

Financial goals are both for the short-term and long-term. A short-term goal is what you want to achieve in 6 months to 2 years. It could be a goal of not incurring any more credit card debt while you’re still in your residency. Or it could be saving up enough cash to go on a vacation in 2 years. 

A long term goal could be to retire 5 years early or pay off your student loans within 10 years. If you haven’t clearly defined what you want to achieve with your income, then you will never feel as if you’re making progress.

If you do have your goals already established, then now is the time to revisit them and see how far along you are. Ask yourself if you are on track to where you wanted to be, and what you can do in the new year to make sure you stay on the path or get closer to your goal.

2. Fine Tune Your Budget

If there’s one thing I enjoy talking about more than financial goals, it’s using a established a budget, then you should definitely focus on getting one together. 

If you already have a budget, this is an excellent time to see what is working and what needs fine-tuning. Remember, budgets are personal and they are based on your priorities. If your priorities have changed since last year (such as a new home or new baby), then your budget needs to reflect that change. 

If you’re having an issue tracking your expenses, then try a website such as Tiller Money to stay on track. It’s what I personally use and find it very helpful with keeping my finances organized, especially what’s coming in and going out.

3. Evaluate Your Expenses

While you’re evaluating your budget, you may realize you’re paying too much for certain household expenses. If you think your cell phone bill is too high or your cable bill has gotten out of control, then go ahead and start negotiating.

There is no reason to overpay for these types of services when there are almost always competitors out there willing to work with you on price. Often times it only takes a quick phone call and you can lower your bill. 

Don’t forget your insurance premiums either. If you have an agent you work with for your homeowners or car insurance, don’t be afraid to call them and ask them to review your policies. You never know if you are eligible for other discounts. Use this time of year to make sure you’re minimizing your expenses, so you can maximize your income.

4. Check up on your Emergency Fund

A thorough year-end financial checklist needs to include a review of your emergency fund. While most experts recommend 3-6 months, only you can determine what the adequate amount is for your situation. If you haven’t already begun setting aside money for an emergency, then there is no better time to start. 

Having an emergency fund not only helps you cover the unexpected expenses (the ones which wreak havoc to your budget) but also offers tremendous peace of mind. You will also get the added benefit of not having to rack up additional credit card debt.

If you have already established an emergency fund, then take a look at how much you currently have set aside. Did you meet your financial goal? Do you think there is an opportunity to improve your emergency fund? If not, then decide what you are going to do in the new year to help you get to where you need to be.

5. Review Workplace Contributions and Withholdings

If you need to review your retirement accounts, start with the ones you are contributing to in your workplace. You can contribute up to $19,000 ($19,500 in 2020) annually into a 401k or 403(b) retirement plan (or more if you are eligible for the catch-up plan). 

If you have an old 401k or 403(b) which you no longer contribute to, then you want to get the process started to convert it to another account, such as an IRA. It’s important to roll the old account over as soon as possible so you can have as many investment choices available to you as possible. Typically, with workplace accounts, you are very limited in how your money is invested. By rolling over into a new account, it opens up many more possibilities for you to invest.

And speaking of withholdings, you should double-check your paystub and make certain you are withholding the correct amount. An accountant can help you make an informed decision, but you want to make sure you aren’t withholding too much or too little for your taxes.

6. Review Your Investment Portfolio

The end of the year is a good reminder to check in on financial advisor.

You may not necessarily need to make any changes, but you do need to know how your money is being invested.

7. Get Your Mail Organized

Getting organized often starts in your own mailbox. One of the simplest ways you can control clutter is to immediately discard any junk mail before it even hits your kitchen counter.

Beyond throwing away your mail, take a few moments to go through the mail you do have throughout your house. Better yet, take a moment and set up a system to put your important mail in a place where you will review it in a timely manner.

8. Organize Your Documents

It doesn’t do you any good to go through a year-end financial checklist if you can’t find any of your important documents. It’s worth the time to make sure every important document is in one place where it’s easily accessible. Now that your mail is organized, it’s time to make sure your other papers are taken care of as well.

You’ll want to make sure you can quickly put your hands on birth certificates, passports, estate papers, insurance policies, and all of your student loan information. You may think you know where every document is, but try to think of it from someone else’s perspective. Would someone be able to locate your information if there were an emergency? 

9. Review Your Student Loan Balances

Since your student loan information is all in one place, it’s a perfect time to go through each of federal or a private loan, or if you have any deferred payments ending soon. The last thing you want is to be surprised by your student loans.

When you’re reviewing your private loans, take note of ones that you think could be good candidates to refinance into a better rate. 

I know there are days you would rather read anything but your student loan information. It’s not surprising since many physicians are faced with debt well into the six figures. Unfortunately, just because we don’t look at them doesn’t make them go away. The best strategy is to deal with the debt head-on, and the only way to do it is to know the exact amount of student loan debt that you have.

10. Fill Out Information for PSLF (Employment Verification)

If you are trying to pursue PSLF for your student loans, then each year you need to fill out the employment verification. Yes, technically you could wait until the end of your 10-year qualification period to send in the information. Do yourself a big favor and go ahead and submit for the year. I promise you, in 10 years it won’t be as easy to locate all the information you need to fill out the paperwork. 

Each year, more students are receiving loan forgiveness. Whether you are 100% sure or not if you will pursue the PSLF program, it doesn’t take much time to at least keep up with the paperwork.

11. Review All Other Debts

Your student loan debt may be enough for you to think about, but chances are you have other debts too. If you have mortgage, then you owe it to yourself to check up on those as well.

The end of the year is a perfect time to review how much you owe. Remember how we talked about your financial goals? debt repayment plan.

Many people like to tackle their smallest amounts first. Others subscribe to the idea of going after your highest interest rate loans first. The most important point is to have a strategy in place and a plan to implement it. If you feel like you need to make more traction with your student loans and other debts, then you could also use the services of a fee-only financial advisor to help guide you through the process and make suggestions.

12. Review with Your Spouse

Although a “money date” may not sound like the sexiest night on the town, it’s a great time to have an in-depth conversation with your spouse about your finances. It’s important to do check-ins along the way, so both of you are on the same page when it comes to goals and expenses.

It doesn’t have to be a boring sit down at the kitchen table either. Spice it up a little bit! Hire a babysitter and go out to a new restaurant, and talk about your goals for the new year. Whatever you decide to do, it’s important to at least have the conversation. This is even more critical during your lean residency years when money is tight and you’re having to hurry up and wait on things.

13. Review Your Life Insurance Policy

Hopefully, by now you’ve made a decision to choose a term life policy. You may think this is one of those items you sign a contract for and then never need to look at again.

However, you will want to review your term life insurance policies each year. If your circumstances have changed (such as getting married or starting a family), then you need to make sure your coverage is adjusted to reflect the change.

It’s a good idea to stay in contact with your sales rep to make sure you have exactly what you need for your family. 

14. Review Disability Insurance Policy

The same can be said for your long-term disability insurance policy. Disability insurance is not something you want to set and forget. Many residents choose to purchase a policy while they are still in their residency. As you know by now, a lot can happen in a few years. You could have moved, gotten married, and started a family. Or you could be well into your career as an attending physician.

All these scenarios make it necessary for you to review your policy. It’s possible you have a disability rider which allows you to purchase additional coverage as your income has increased. If that’s the case, then now may be the time to act on it.

No matter what your policy says, it’s important to review annually. If you have questions, you should set up a time to review with a trusted long-term disability insurance provider.

15. Start a 529 Plan

I’m sure you don’t need to be told how expensive college is these days. If you have children, you can start a 529 plan for their educational expenses and help ease the burden. Currently, there are over 30 states which offer an option and you don’t have to be a resident to choose a specific state. You can make the decision based on what works best for your timeframe.

Not only can 529 plans be used towards college tuition, but they can also be used towards private and parochial schools that offer primary education. If for some reason your child doesn’t use it (if they choose not to go to school OR they receive a full scholarship) then you can transfer the amount to your other children. You can also use the funds for your own continuing education, or gift to another family member.

16. Use Any Money in Your FSA 

Using up all your money in your FSA for the year sounds easy, but each year there is so much money given back to employers! That’s right, if you don’t use it then it goes right back into your employer’s pocket.

You have to use your money for all eligible expenses before December 31st. Some companies even allow you to roll over $500 to the next year. Your best bet is to go ahead and use what you’ve already paid for though.

There are several thousand FSA-eligible products which you can purchase at any time. It’s a great way to stock up on medical supplies if you happen to have any money left at the end of the year.

17. Review Your Charitable Donations

Lastly, if you have a favorite charity that you regularly contribute to, then make sure you review this at the end of the year. Go ahead and put your receipts together so you’ll be prepared when you file your tax return.

Beyond the receipts, take time to think about the donations you are making. Are you still supporting something which you feel is worthwhile? Perhaps it’s time to consider changing the amount you are donating or the organization you are donating to. Whatever you decide, think about how great it is to be able to contribute to something you care about.

Your Year-End Financial Checklist Can Save You Time and Money Next Year

17 steps may seem like a lot but most of these can be completed very quickly. The goal here is not to overwhelm, but to encourage you to focus on your finances. You might not be able to complete all of these in one day, but you can definitely get yourself on the right track by reviewing these necessary items.

The good news is, going through a financial checklist like this will not only help you stay organized and well-informed with your finances, but it will set you up for a very successful New Year.

Enjoy your new, simplified financial existence

Managing money is more than just dollars and cents, it’s a philosophy of life. How you approach your daily choices and set your priorities spills over into how you handle your money. The more streamlined and uncluttered your life, the more streamlined and uncluttered your finances.

No matter what your financial situation or how big your debt, know that this is not an insurmountable burden. You can take control.