Knowing that you have around 3 - 4 lakhs in your account doesn't mean you know what you really have. Can you zero it to a figure and say that you have Rs 3,06,530.25 in all your bank accounts put together?
If not, then you are not tracking your money efficiently. Don't worry you don't need to be a pro in financial management to get your money matters in order. Anybody can do it, all it takes is a little organisation and time. So this is what you do to get money smart.
1. Cash in hand
Have you ever been extremely excited when you found a hundred rupee note in your jeans pocket? Starting up with knowing how much cash you have on you and at home is a good place to begin.
How much cash do you have in your cupboard right now? Go and open up every cupboard and drawer (and yes check under the clothes for those little envelopes and purses).
Tip: Instead of dividing your cash to keep it in different cupboards and in between your clothes, store your money safely in a small cupboard locker. This way it will remain safe and won't fall into your maids hands either.
2. Dividends and cheques
Make sure to claim your dividends as and when you get them. They may be worth a few hundred only, but if you don't claim them before the date or throw them away, you will be at a loss.
Tip: If you do find an old dividend than has lapsed, then you can mail the company and ask them to reissue the dividend.
3. Filing tax returns and claiming tax refunds
It's the end of the financial year and you have to file your returns. Forgetting to do this will hand you with a heavy penalty of Rs 5000.
If you don't claim your investments then a larger amount of your taxes will get deducted. You need to put in your investment declaration so that you get your income tax returns at the end of the year.
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4. Have your FDs matured?
You get your Fixed Deposits and forget about them. This means that you are losing out on the interest for the entire period that you let the FD and its interest lie in the account.
So to make things easier, set reminders for your FDs and when they mature.
Tip: To keep track of what is maturing, find out if your bank will send alerts. Most banks do send across a letter informing you that your account has matured. You can also set up reminders on the phone.
Also check whether you can give a standing instruction to the back to transfer the amount to your savings account.
5. Bills on time
Make sure you pay your bills on time. If you are late you have to pay a fine, even though its not much even 100 rupees on every bill a month does amount to quite a sum. If your are a working-woman it is real hard to find time to go and pay your bills. Sometimes even when you do have time, it is sheer laziness that keeps us from going out and paying bills.
To make it easier you can pay your electricity and phone bills online. You can also arrange for your bank to pay off your bills directly.
If your bills are not paid on time, not only will it cost you a penalty, but in the case of credit cards, it will have an bad impact on your credit worthiness. This means your ability to have a higher limit, get more high-end cards etc. is affected to the extent that you keep defaulting payments.
If you have a job where you keep travelling, then make sure to either pay your rent before you leave, or give your landlord post- dated checks.
Watch out: Everybody from the phone companies to your landlord will stop providing you with a grace period even in times of genuine difficulty if you always delay payments. Also, if your checks keep bouncing, your landlord can take you to court.
You can put your bills in drop boxes at your Railway Station also. So keep an eye out for them.
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6. Credit card statements
If you use your credit card often, then you can't keep track of every thing you swiped for. If you have your slips carefully, then you can cross check your credit card statement at the end of the month. Also where possible get your online credit card statement activated.
Tip: You can now get SMS alerts on your mobile phone. So contact your Credit Card company for this.
7. Manage your money
Don't keep a booklet to keep a track of your accounts. Use online managers or at least a simple excel sheet to track your income and spends. It's more organized and easy to update too.
8. Know your worth
The next important step is to identity what your financial assets are. Have you invested in Mutual Funds, other shares, FDs etc? Do youown property that has gone on rent? Well keep a track of all your investments to see how much you own. Then find out what returns you get on all these different investments.
If you don't know how much cash you have in your bank then go and get a statement quick.
Also check with parents etc. to see if you have any money on your name that you aren't aware of. Don't forget to find out if you have any property too. Find out also about where the documentation is kept.
Tip: God forbid something happens to the person who is dealing with all your property and money, you will have to get into tedious legal tangles to get your 'own' money/property.
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9. Organising your documents and bills
It's very important to keep all your house papers, car papers and insurance documents carefully and in a place that you won't forget about them. Another thing that you should not throw away are your mutual fund documents and any other correspondence you have made with your bank.
Make sure that you enough of money in your bank to pay of your EMIs when they are due. Your EMI payments go directly from your bank, so make sure that you have enough of money in your bank to pay your dues off.
Depending on your Insurance policy, you would need to pay your premium either quarterly, half yearly or annually. Your insurance company will send you a reminder about this a month before it's due, so make sure that you pay up on time.
If you don't pay up on time, then you will have to pay a penalty. LIC charges a penalty of 9% of your premium. If you have a new policy then you could be fined for as much as 12 % of your premium.
Documents Check Off Car Loan and Ownership Papers House Loan and Ownership Papers Life Insurance Papers Medi Claim Documents Pan card.
Remember: If you have made any tax saving investments in the month of March, you need to see if you have enough balance in your account to pay off your premiums.
10. Keep this confidential
Heard about the credit card number thefts? Well be smart about who let out such confidential information to. Don't ever give it out to someone who calls and claims to be from your bank. Also when shopping online, make sure you go to a reputed website only. Your ATM card password is another thing.
Don't write it down and keep it in your wallet, that's the first place someone will look. Just memorise your number and don't let it out to even your best friend.
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