How to Get Your Financial Records in Order

Getting your financial records into a well-maintained state does not need to be complicated.

You will be able to get your taxes done quickly and easily. You won’t need to be afraid of auditing, you’ll have control over your financials and will be able to know where you stand at any given moment.

Unfortunately, a lot of people are not willing to sort their paperwork up until it’s the last day to file their taxes.

People think that getting their financial records in order is almost an impossible task.

They often feel that:

• They don’t have time to get it done
• It’s too complicated
• Don’t see the benefits why it’s good besides their tax return

You can get your records in order, and here is how.

Step 1: Digitalise all receipts

You don’t want to go through the faded receipts at the end of the financial year, trying to figure out what was that receipt for and what’s the amount.

Create a folder in your Dropbox (I like Dropbox because it has an option to scan a document) and set up a folder for each financial year. Upload all receipts into that folder. Remember to add the exact amount in the file name. This is how you’ll search for your receipts if you need to.

Step 2: File digital receipts/bills

If you get bills via email — then file them inside your Inbox under the same financial year as in your Dropbox. You can later search for the receipt/bill by the date and a provider name.

Step 3: Record expenses and income (on a regular basis)

Either set up a simple Google Sheet for your income and expenses. You would need to set up categories of the expenses as columns. Alternatively, pick software that let you connect your bank account so you could easily move your expenses and income into categories.

You would still need to keep copies of your receipts.

Consistency here is important. The more consistent you’re during the year — less work at the end of the year. Aim to get your financial paperwork done at least once a week.

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