Hasta La Ideas

If you’re good at procrastinating and do it often, putting off doing your 2011 tax returns would be a very simple thing to do. I know it’s even easier to procrastinate doing them when you suspect you owe the government money.

There’s no need to let stress about completing your taxes take its toll on you, though. Getting started with just a few easy tasks right now can alleviate some of your anxiety, help you to be better organized, and assist you with meeting the federal and your state’s tax deadlines. The federal deadline is Tuesday, April 17, 2012, and most states have the same deadline — but pay attention if you live in Nebraska, Louisiana, or West Virginia as your state deadline is earlier in the month. (And lucky are those of you who live in the seven states without an income tax and who only have to file federal forms.)

Make life easier on yourself and try these basic tasks this week:

1. Per U.S. law, you should have already received copies of your tax statements from your employer and investment/banking entities. If you haven’t already done so, grab a large Kraft envelope or file folder and place all of these tax documents into one place. Label the exterior of the envelope or the top tab of the folder as “2011 Tax Statements.” If you have numerous statements, list them on the front of the envelope or folder.
2. If you are filing complex tax returns — listing deductions, credits, claiming expenses, etc. — group all of your supporting tax receipts and paperwork and place them into another large envelope or file folder. Don’t worry about sorting or grouping these documents at this stage of the game, simply gather. Label the exterior of the envelope or the top tab of the folder “2011 Supporting Tax Documents.”
3. Call and make an appointment with an accountant or tax preparer if you are filing complex tax returns. Look up the number right now and pick up the phone. If you don’t know an accountant or preparer, ask for recommendations for people you trust, or consult a review service like Angie’s List. If you have no deductions, credits or other items to claim on your tax form, learn more about e-filing through the federal government and your state (do a Google search for “e-file state of X” with X being your state), or download “ez” forms from the federal government and your state.

My hope is that you have already filed your taxes and the information in this post is completely irrelevant to you. However, if you haven’t, stop procrastinating and take these first steps to getting your taxes done on time.

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The presents have been unwrapped, turkey leftovers fill the refrigerator, and we’re back at our desks finishing year-end responsibilities. Whether at work or at home, there are tasks that we complete before December 31 that help to keep us organized in the new year.

Even though it’s difficult to get back to work after a few days vacation, the last week of the year can often be extremely productive because so few people are in the office. There usually are fewer disruptions and it’s easier to work for longer blocks of time. If you’re taking time off from work, now is also a good time to focus on year-end responsibilities at home.

The following are tasks we complete at the end of the year, but you might tackle different tasks to wrap up 2010 and prepare for 2011. Share your end-of-the-year processes in the comments, as they might be something we all should be doing, too:

At Work:

• Year-end fiscal reports. Pay all bills, submit all receipts, reconcile all accounts, and complete all fiscal reports the accounting department requires.
• Year-end professional goal reports. Review annual goals and accomplishments, and write performance reports the human resources department requires.
• Review benefit package and changes. Many changes in insurance plans and other benefits occur at the change of the calendar year. Make note of these changes so you aren’t surprised by the differences.

At Home:

• Reconcile financial accounts. Now is the time to get all of your financial paperwork for the year completed so you’re ready to file your taxes when your forms arrive.
• Year-end personal goal and resolution review. Review all you accomplished over the course of the year and create goals and resolutions for 2011.
• Back-up all digital data. Even if you do this daily, it’s good to take a final snapshot of the digital year.
• Review beneficiary information on all investments and policies. If your family has grown or changed in the last year, now is the time to make sure your beneficiary information is current. Additionally, it’s a good time to do a general review of these investments and policies.
• Review systems and routines. Are the systems and routines you follow meeting your family’s and home’s needs? If not, now is a good time to create new practices to implement in the new year.

Like this site? Buy Erin Rooney Doland’s Unclutter Your Life in One Week from Amazon.com today.

Last winter, when one of our cats was diagnosed with a rare cancer, my husband and I took the cat to a renowned pet oncologist. Some of our friends, the pet lovers in our group, said they would have done the same thing to help a member of their family. Other friends, mostly people who don’t have pets, called us fools for considering the thousands of dollars in cancer treatments the oncologist might have recommended.

We ended up not having to make a treatment decision because the cancer was untreatable, and Basie cat passed away a few days later.

A couple weeks after that, my husband and I sat down and talked about setting up a medical saving account for our cat Charlie and any future pets we might adopt. We put $500 into savings and have been depositing $20 per month ($10 each) into the account since that time. Commercial pet insurance can be more expensive than what we’re doing, and, like traditional health insurance for people, it doesn’t cover all medical procedures and treatments. And, if we never need the insurance, we wouldn’t get the money we paid the pet insurance company back or with interest or be able to apply the premiums to another pet.

Simply, we created the specialized saving account for our pet because we never want to be in a position again where money has to be strongly considered along with treatment options.

After making this decision to create a medical saving account for our pet, we started to realize how this way of budgeting could help alleviate stress associated with other areas of our finances. We immediately created a specialized saving account for our automobile — $20 a month now goes into an account to cover service needs for our aging car. We also made a window replacement fund since we have a house mostly made of glass and a toddler with an amazingly strong throwing arm.

How to create a specialized saving account: When you acquire a new responsibility, you deposit an eighth or a quarter of your saving goal into a dedicated saving account as the account’s start-up fund (or a multi-use account that you keep records for what money in the account is for what purpose). Once the saving account is open and initially funded, you set up an automatic transfer through your bank to put $10 or $20 (or whatever amount you choose) into the new saving account from your checking account every month. This automatic deposit removes the temptation to spend the money on something else.

These specialized saving accounts reduce your stress, allow you to cover large expenses when they arise, and help you to live with an uncluttered budget (a budget where you spend less than you earn). Do you have specialized saving accounts? Would setting one up help you to prepare for an emergency expense? What reasons do you have to create a specialized saving account?

Like this site? Buy Erin Rooney Doland’s Unclutter Your Life in One Week from Amazon.com today.

J.D. Roth, who writes the educational and extremely valuable personal finance blog GetRichSlowly.org, just published Your Money: The missing manual with O’Reilly books. The book is filled with charts, graphs, checklists, guides, and explanations that explore the basics and advanced methods of personal finance — all with Roth’s simple ease and charm.

The book begins with a quote from George Mallory that aptly reflects the focus of the text:

“We do not live to eat and make money. We eat and make money to be able to live. That is what life means and what life is for.”

Roth’s financial philosophy is based on the premise that you have to spend less than you earn. Regular readers of this website know that this is also a fundamental rule of being an Unclutterer. If you spend more than you earn, your thoughts will consistently be focused on anxieties (clutter) about money instead of on what matters to you most. Roth details how to get out of debt, spend less than you earn, and save money for the future (saving also means that you alleviate worries about your financial future).

One of the highlights for me is on page 95 of Your Money: The missing manual. Here, Roth presents a flowchart created by April Dykman that she “created to help her stay on track while shopping.” I think all Unclutterers should have this chart tattooed on their forearms (I jest. Please don’t get a tattoo of this.):

I’m also fond of the section titled “The Tyranny of Stuff,” which is perfectly suited for Unclutterers. In short, Roth’s premise in this section is if you “own less stuff” you will spend less on new acquisitions as well as maintaining the stuff you choose to own — less clutter, less storage space, less to clean, and less wasted money on unnecessary purchases.

In addition to the book, if you aren’t familiar with Roth’s blog GetRichSlowly.org, I also recommend you check it out. Money Magazine named it one of the top two financial advice sites on the internet. Roth knows very well how to get rid of cluttered finances. I give his new book two thumbs up.

In tight economic times, getting rid of clutter can be a good way to cut your expenses and/or bring in extra cash. If you’re looking to save or earn a buck, consider these possibilities:

1. Old hobbies. Most hobbies require equipment, supplies, and/or specialty tools that can easily be resold at near-cost prices. If you’re no longer participating in rock climbing, scrapbooking, or golf, consider selling the hobby’s accouterments. Sites like eBay and Craigslist are good options for selling the supplies, and so are sites where hobbyists visit (like Ravelry for knitters, crocheters, and spinners).
2. Collections. If you’ve lost interest in a collection, consider putting it up for sale on eBay. Sell things as a single lot if you don’t want to spend the next couple weeks at the post office mailing each piece of your collection to far-flung locations around the globe. Look at other sales of similar items to see what kind of a bid to expect.
3. Maintenance costs. The more stuff you have, the more you have to maintain — you have to pay for more square footage in your home, more money goes out to heat and cool your space, and even more is spent on things like painting, cleaning gutters, lawn mowing, etc. Typically, to get more square footage in a home, you also have to live further from your job, which increases commute times, travel expenses (fares, tolls, gasoline), and you have to service your car more often. All of it adds up, putting greater strain on your pocketbook. Living simply almost always means paying significantly less on maintenance costs.

Where have you found cash in your clutter? Share your suggestions in the comments.