Feeling Out of Touch with Finances

How often do you balance your checkbook and check on bills?

The routine that I typically use is to call our “bank-by-phone” number or log into our online account once per week to do a checkup on all of the debits that have been made and the checks that have cleared.

When our monthly banking statement arrives, I do a quick verification of all the data and finalize the balances. While this may seem like a fair amount of work, I’ve got it down to a nice routine and it works very well for me.

Out of Touch
Over the last few weeks, we have had a lot of things going on at home and I’ve been very busy with work. We’ve finally had the window replacement completed and then ordered new blinds. The blinds arrived and were installed last week so things are finally starting to settle down on that front.

With everything that has been keeping my occupied, I haven’t been following my regular routine of the weekly balancing and it has left me feeling a little bit out of touch with everything.

In addition to not following my routine, I have noticed that my filing system of incoming bills and bills that have been paid has also taken a turn for the worse. Right now my desk has a large pile of papers that need to be addressed, although all of the payments have been scheduled so I just need to clean up the paperwork.

Build Strong Habits
This experience over the last few weeks has demonstrated to me the importance of creating habits for yourself. If you fly by the seat of your pants, I feel that it is much easier to ignore things too long and get yourself into trouble with late payments or overdraft fees if you’re not careful. While I know that might work okay for some people, I now know that it does not suit my personality.

By maintaining my routine, I have developed a keen sense of knowing what our balances are at any time and how upcoming bills will impact our available funds. Without these habits I am sure we would have a more difficult time given that we follow a fairly loose spending plan.

Have you found that you need to stick to a routine in order to maintain your comfort level? Or do you find that you work better with a more relaxed approach?

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11 Responses

  1. story says:

    I’m ashamed to say I never balance my checkbook. I used to check my bank account balance at least once a week but I haven’t been checking it lately because we had a (probably too big) cash cushion in there and, I am embarassed to say, my husband checks it so I figured I didn’t have to. I have to get back in the habit of checking myself and making time for us to over it together.

    • mnc says:

      You might be on to something with regards to the cash cushion. We’ve had a large cash cushion in our account that coincides with these last few weeks where I feel out of touch.

      You also touch on an important thing in that communication is essential. If one partner doesn’t check accounts on a regular basis, communication is even more important.

      Thanks for the feedback!

  2. Eric says:

    I think that’s the hardest part is to build the habits. My wife is studying for a professional exam for her career. The exam is really difficult and she’s studying 2 hours a day for 6 weeks to take the exam. She’s been keeping a calendar by the door that she has to see everyday. She puts an x on it everytime she studies. We’re trying to do the same thing about eating out. Every day we don’t eat out, we put an x up and see how long we can go.

    • mnc says:

      That sounds like a great idea to mark the calendar on days when you meet your goal and challenge yourself to go as long as possible.

      We’ve been pretty bad about eating out this summer. We tend to eat out more in the summer as nobody wants to be in the kitchen cooking. I’ll have to suggest your idea to my wife.

      Hope your wife does well on her exam and thanks for sharing your feedback!

  3. SavingDiva says:

    I check my accounts online at least a few times a week. I’m a little crazy when it comes to checking them. I think I might be TOO in touch with my money.

    • mnc says:

      Lol, I know what you mean. I used to check my accounts twice per week but have learned to adapt to once a week to feel comfortable.

      Things like my savings accounts and retirement accounts are only checked once a month when I update my net worth statement but those accounts are typically deposits only and are on auto-pilot.

      Thanks for sharing your experience!

  4. I’m an online banking junkie, I check my accounts daily and enjoy figuring out ways to optimize my interest returns etc.

    • mnc says:

      That is something that I miss since I switched the bulk of our eFund over to HSBC from ING, as the ING account updates the accrued interested on a daily basis.

      It was always nice to log in and see how much more interest I had than a day or two before. While I know this can be computed in a spreadsheet, it is more fun to do online. 🙂

      Have you figured out any great ways to optimize your interest returns?

  5. Well, the best way I’ve found is with laddered certificates, unfortunately to do them effectively you really need a good amount of startup capital ($20,000+).

    The purpose behind laddering is to give a more frequent payout than just putting all your cash in one large CD. This also helps make a CD-heavy portfolio more liquid.

    So let’s say you have $20,000 you want as a safe no way to lose it type of investment you put it all in a CD you saw advertised for an 8% apy over a 12 month time period hoping for $21,600 in a years’ time. Month 11 rolls around, and your son is in a major car accident, he forgot to pay insurance and the other driver didn’t have any. You need an extra $6,000 beyond your emergency savings. Now you’ve lost all the interest because you had to break the CD early.

    With a laddered portfolio it’s a bit different. Instead of putting it all in a 12 month CD, you split it up into $5000 chunks and put it in 3, 6, 9, and 12 month CD’s respectively. Now, when each CD matures, you open a new one at the 12 month rate (you can even do 11 or 13 months if there’s a rate special). Once the first cycle is complete, it will seem like you are getting a higher interest rate on a short-term CD.

    Lots of retired people do this, sometimes monthly, and they just have the interest deposited into their accounts. I would not be comfortable doing something like this outside of a brick and mortar institution though, because I would want someone inside monitoring rates for me.

    I would love to write a guest post on this sometime as well, banking is one of my biggest passions.

    • mnc says:

      The last time I looked at CDs the rates were nowhere near 8% and were actually paying less than many of the top online savings options that are available.

      This is a great summary of establishing a CD ladder though. I was actually thinking of turning your comment into a post of its own but I would love for you to write a guest post here!

  6. One of the ads Google was putting on my site when I did the banking products was for an 8% CD, which is where I got the number from. The place I work tops out at 5.10 right now I think. It still beats inflation considering it was only 1.9-2.4 (depending on your source) this past year.

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