By: Joseph Goldy, CFP®, CDFA®
As tax season approaches and winter gives way to spring, March presents the perfect opportunity for a financial refresh. As you might tackle spring cleaning in your home, dedicating time to tidying up your financial house can yield tremendous benefits. Here are five practical steps to declutter your financial life this March:
1. Consolidate and Organize Financial Accounts
It's common to accumulate financial accounts over time: multiple checking accounts, savings accounts at different banks, retirement accounts from previous employers, and various investment platforms. This "collection" of accounts makes tracking your financial picture unnecessarily complex.
Take inventory of all accounts and identify opportunities for consolidation. Consider rolling over old 401(k)s into an IRA or current employer plan, combining similar banking accounts, and centralizing investments when appropriate. Fewer accounts mean less paperwork, easier monitoring, and a clearer picture of your financial position.
Organizing all login credentials in a secure password manager such as LastPass or Bitwarden is a good idea for accounts you decide to keep. Establish a consistent structure for your statements and financial documents so information is easily retrievable when needed.
2. Streamline Your Bill Payment Process
Review all recurring bills and subscriptions to identify services you no longer use. Streaming services, gym memberships, subscription boxes, and digital tools often continue periodic charges long after they stop providing value. Be ruthless about eliminating what doesn't serve your needs.
This is an ideal time to review your utility bills to ensure no limited-time promotions have expired, causing an increase in your regular bill. In 2023, I noticed I was paying more than double the amount for electricity due to a 3rd party promotion that had ended many years earlier. Take the time to carefully review your bills to ensure this doesn't happen to you.
3. Perform a Tax Efficiency Checkup
As you prepare your tax return, use this opportunity to review tax withholdings, retirement contributions, and investment tax efficiency. Adjust your W-4 withholding if you received a large refund or owed significant taxes last year—aim to break even rather than provide an interest-free loan to the government.
Maximize tax-advantaged accounts like 401(k)s, IRAs, and HSAs early in the year if possible. For taxable investment accounts, HIGHLAND's trading team regularly assesses whether tax-efficient fund placement or tax-loss harvesting strategies might reduce a client's tax burden.
Create a simple checklist of tax-related documents you'll need for next year's return, noting where each can be found. This proactive approach transforms tax preparation from a stressful scramble to a streamlined process.
4. Purge and Digitize Financial Records
Financial paperwork can quickly accumulate, creating both physical clutter and mental overwhelm. March is an excellent time to sort through financial documents and discard what's no longer needed.
Generally, tax returns and supporting documentation are kept for seven years, but most monthly statements and bills can be discarded after reviewing them for accuracy. Investment records should be kept until the investments are sold, plus seven years. Consider a fireproof safe or safety deposit box for critical permanent records like property deeds, birth certificates, and estate planning documents.
Consider digitizing documents you need to keep but don't need physical copies. A quality scanner and secure cloud storage solution can dramatically reduce paper clutter while making documents searchable and accessible from anywhere.
5. Refresh Your Financial Protection Strategy
Financial housecleaning isn't just about paperwork—it's also about reviewing outdated protection strategies that no longer align with your current situation. At HIGHLAND, we meet regularly to review all insurance policies, beneficiary designations, and estate planning documents to ensure they reflect our client's current wishes and circumstances.
We check that insurance coverage amounts still make sense for your situation and that beneficiary designations on retirement accounts and life insurance policies reflect your current intentions. Updating these designations is particularly important if you've experienced significant life changes like marriage, divorce, or children.
Review your credit report from all three major bureaus (available free weekly at AnnualCreditReport.com) to identify and correct errors or outdated information. We recommend freezing your credit if you're not actively applying for new credit to reduce identity theft risk.
The Reward of Financial Clarity
Taking these five steps each March creates a virtuous cycle—the clarity you gain makes financial decisions more straightforward throughout the year, and next year's review becomes a little easier. Like physical decluttering, financial organization reduces stress, improves focus, and creates space for what truly matters. Set aside a weekend this March to tackle these tasks, and you'll reap the rewards for months to come.
Joseph Goldy, CFP®, CDFA ®, is a wealth advisor and CERTIFIED FINANCIAL PLANNER™ at Highland Financial Advisors, LLC, a fee-only fiduciary wealth advisory firm based in Wayne, New Jersey.
Joe specializes in working with newly independent women because of divorce or losing a spouse. He understands firsthand the value of having a clear financial picture pre- and post-divorce and a plan to restate goals as a single person. When he is not helping clients, Joe enjoys spending time with his two sons outdoors and volunteering to help raise money for Type 1 diabetes organizations.