Like many of you, I suspect, I have a never-ending, ever-multiplying list of undone money tasks. There are always a few accounts that charge too much or pay too little interest, service providers to haggle with and opaque insurance forms that beg questions. Who has time for all but the most essential items on this list on any given day? Or in any given month, for that matter?
So I decided to spend 10 or 12 hours trying to cross off every single item on my list. The goal wasn’t merely completion. I also hoped to actually gain back the money I had lost to the pay cut, either through savings or increased earnings in bank and credit card accounts.
By the strictest definition, I failed on the first count.
The list was too long to even start certain items on it, and many of the money tasks require multiple steps. The new jewelry insurance requires an appraisal. The nanny tax company needs a pile of information to get started. The will-writing lawyers don’t call back right away. At least I got these tasks started.
Financially, the total of my savings and new earnings will net out to about $2,000 annually after taxes, thanks mostly to a better savings account rate.
That doesn’t quite replace the lost income, but it’s a lot more money than I had before.
The real gain here, however, was in establishing a new ritual. I got enough done that I now plan to take a fiscal health day at least once a year, 10 hours on a weekday when all phone lines and financial institutions are open, with no interruptions except for e-mail.
Here’s a list of some of the things I knocked off or got started. Or, if you prefer movies to articles, watch the mini-documentary of my day.
HIGH-YIELD SAVINGS ACCOUNT Though Internet savings accounts that pay above-average rates have been around for some time, I haven’t needed one. Now that we’re keeping more cash around in case we want to buy a new place to live, however, it makes sense to enroll.
I put our money in an account via SmartyPig, a Web-based savings program. It pays an industry-beating 2.75 percent, though it comes with certain restrictions, like the requirement that you put at least $10 in your account each month.
CASH-BACK CREDIT CARD The new Charles Schwab Bank Invest First Visa pays a straight 2 percent back into our Schwab brokerage account. That’s 0.75 percentage points better than we were earning with our Capital One card. The Schwab card also levies no foreign exchange fees for use outside the United States.
JEWELRY INSURANCE We are paying nearly $400 annually to insure our wedding and engagement rings. Jewelers Mutual, which I’d been meaning to call for more than two years, can do it for about $250, as long as we produce an appraisal.
PHONE SERVICE We stripped our landline bare of any long distance or special features and got rid of our DSL service, which we had been using as a backup for our cable Internet connection. That will save about $500 annually, though that savings will be partly offset once we find another backup plan.
Not surprisingly, given that we’re talking about the phone company here, this task ate a bigger part of the day than any other. I had to talk to the landline people, the DSL people and the billing people to confirm a switch on the auto-payment system to our American Express card (now that Verizon finally accepts it). Of course, I waited on hold, ended up in the wrong call center and had one call dropped. But hopefully, I won’t have to talk to them again for years.
NANNY TAX SERVICE I signed up with the Nanny Tax Company in Chicago to deal with the quarterly and annual tax filings related to paying our baby sitter on the books. While this costs $425 annually plus a one-time $100 registration fee, the time savings makes this a wash, if not a net gain in money.
A representative with our bank at Schwab also explained that it would allow us to make free, regular direct deposits into our baby sitter’s account at a different bank. That means we can create a free, basic payroll service, since we’ll get help calculating withholding amounts from the Nanny Tax Company.
WILL We still don’t have one, even though we’ve been parents for three and a half years now. Pathetic and inexcusable. But it won’t be that way for long. We’re considering hiring a lawyer from New York State who is far from our Brooklyn home to save money, and I called three lawyers on fiscal health day looking to price the possibilities. Local lawyers who think this approach is foolish should sound off in the comments on this story. We will finish this task before summer’s end.
INSURANCE PAPERWORK If you’re lucky enough to have health insurance, you’re probably constantly adrift in a sea of forms that make no sense. We’re no different, but a major snafu caused us to have to switch plans a few months into 2009, throwing everything into utter disarray.
On fiscal health day, I got all of the paperwork divided into about a dozen piles to begin our assault on the benefits office and the various insurance companies involved.
WHAT TO DO IF WE’RE DEAD Merrill Lynch gives away a terrific form titled “Organizing your financial life. Critical information at your fingertips.” It’s basically a road map to sorting your financial affairs in case you fall off a large cliff, though Mother Merrill doesn’t quite market it that way. After several years of putting this off, I finally filled out the form on fiscal health day and will send copies to our families soon. There’s a link to the form from the version of this story online.
NONPROFIT AUTOPILOT In less than 10 minutes, I put a bunch of our charitable giving on autopilot. We signed up with Networkforgood.org and then asked it to charge our credit card each month and pass along the money to the nonprofit groups. No more end-of-the-year scramble to get donations out, and the institutions will receive more regular income.
Network for Good does charge a fee for its service, and it may be possible to set up recurring donations free with individual nonprofit organizations.
SHOPPING SPREE Yes, you get to have fun on fiscal health day. Gather up all of your gift cards and spend the money that’s left on them. The longer they sit, the more interest Apple or Borders or the department store will earn from your money and bigger the chance you’ll misplace the card.
We had $68.63 that had been on a Barneys card for a while, and I used it to add to my collection of colorful socks. This being Barneys, I needed an extra $15 or so to add a second pair. Still, the beautiful hosiery was a great reward for having finished a bunch of longstanding financial chores.
What a great idea! Here are some "refinements" I would make to it.
Balance pain and pleasure. Why not unplug from distractions while you do this by staying at a B&B, a nice hotel or in that cabin you've been eyeing for vacation? (Make sure all have phone and internet access. You're going to be using these heavily as you get organized.)Or at least set some time in the evening for a movie, dinner or your favorite activity as a reward to yourself. This will be hard work!
Set priorities.The night before, make a list of what you need to get done. Break it into groups. Your "A-list" should be done NO MATTER WHAT. Your B-list after your A, etc.
If you need help, get it. Some of what you may need to do could involve visits to professionals. Do you need to see your accountant? Your tax attorney or estate planning attorney? Do you have a financial advisor? How about that meeting with HR to discuss plan or benefit changes?
Do nothing else. This is going to require total commitment and focus. It's the "other things getting in the way" that has prevented you from doing this before, right? So turn off the TV, the iPhone, leave email to another day.
Good luck!
