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Organizing My Personal Finances

My personal finances have not yet become very complex. Every month I do a financial status update, which reveals that I have a checking account, a money market account (MMA), a Roth IRA, a Schwab account and a Vanguard personal account. On the liability side I only have two credit cards (one of which is a new TrueEarnings Costco AMEX card that is new this month) and a car loan. My finances will be getting slightly more complicated as I am closing on a condo this Friday. I currently keep a very simple organizational system that consists of file folders and Excel, although in the future I will be looking into more advanced services like (a free service) and Quicken.

Current Organizational Setup

Due to the minimal number of assets to track and the continuing efforts of financial companies to go paperless, I have not been forced to complicate my organization with more than file folders. I keep a file folder for each credit card, my checking account, my money market account, my tutoring and regular job pay stubs, information regarding my condo, my Schwab account, my Vanguard accounts, my tax return information and a miscellaneous folder. The miscellaneous folder contains random information such as utilities/bills information, car loan information and donation information.

I track the value of my accounts and my net worth through Excel. Since my current asset structure is very simple, I do not have to use a more complicated method of tracking my assets. I do plan on developing an asset allocation strategy in the near future. When my investment assets are significant enough to allow for an asset allocation without paying exorbitant fees I may have to start using an aggregating software of some sort.

I have also setup an amortization schedule on excel that will allow me to track the principal and interest paid on my mortgage. Also, I can easily track the equity that I hold in my condo and track my progress with the amortization schedule.

Potential Future Organizational Options

Since I do not adhere to a budget of any sort, I have not yet tried to take advantage of financial software. I opened a account about a year ago, however, at the time mint did not recognize my MMA. As I was transferring money from my checking account into my MMA, the software continually displayed a net loss in my monthly updates. I’m assuming has developed the software further since my last attempt and I will most likely return to in the near future.

I am under the impression that a significant portion of the population uses Quicken or some other similar software to keep track of budgets, assets, liabilities and overall net worth. If I ever stumble upon a free version I will give it a shot. If I like the free version I may purchase the most recent version.

Thoughts on Organization

I have managed to keep my organizational system very simple as my assets and liabilities are very simple. In the near future I plan on complicating the entirety of my personal finances. Starting Friday I will have a mortgage to keep track of. I intend on opening multiple different savings accounts to spread out my savings goals such as an emergency fund (that I plan on CD-laddering), traveling and major purchases. I will be opening a solo 401k before the end of the year. I will be developing an asset allocation strategy for my retirement assets. I will be opening a play account at Zecco as soon as some funds are available. I’m sure with all of these changes I will have to modify my organizational system in the near future and I will be sure to keep everybody informed as I make changes.

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