Spring is the best time to declutter, be it your closet or your finances. Just like deep-cleaning your home gives you a sense of clarity and peace, getting your finances in order can relieve stress and set you up for long-term success.
Managing money can sometimes feel overwhelming, but a little organization can go a long way in helping you take control of your financial future. Whether you’re planning for major life milestones, working towards financial independence, or simply trying to stay on top of everyday expenses, having a clear financial plan will make your journey a lot easier. Here’s how you can give your finances a fresh start this season.
Review Your Budget
Your financial situation changes over time, so your budget should evolve too. Its wise to keep a track of your monthly spending using an app. This way you can categorize expenses into essentials (rent, utilities, groceries) and non-essentials (eating out, shopping, subscriptions). If you’re overspending in certain areas, set limits and make adjustments accordingly. Consider switching to a zero-based budget to ensure every rupee is accounted for.
For instance, Priya, a 28-year-old marketing professional who realized she was spending nearly ₹10,000 a month on food delivery and subscriptions she barely used. By tracking her expenses and making conscious spending decisions, she was able to cut back by 40% and redirect that money toward her savings.
Just like an overflowing wardrobe, too many bank accounts, credit cards, and subscriptions can be a lot to handle. Close any dormant bank accounts or credit cards you no longer use. Review your subscriptions, are you still using that gym membership or that streaming service you forgot about?
Tackle Debt & Boost Your Savings
According to PwC, India's credit card market is on track to reach 200 million cards, growing at a 15% CAGR. Debt can be a major stressor, but tackling it head-on can make a huge difference. Start by listing all your debts, including credit cards, student loans, and any other liabilities. Consider prioritizing paying off high-interest debt first, as it costs you the most in the long run.
Try using the avalanche method- paying off high-interest debts first or the snowball method, which allows you to pay-off smaller debts first for motivation.
Having a solid savings plan is important and especially for women who may have career breaks, caregiving responsibilities, or entrepreneurship goals. You aim should be to build an emergency fund that covers 3-6 months of living expenses. This way you can help you handle unexpected expenses without derailing your financial progress.
Check Your Credit Report & Optimize Investments
Your credit score plays a crucial role in your financial health, influencing loan approvals, interest rates, and even job opportunities. A study by OneScore found that the average credit score of Indians in 2021-22 was 715, with 56.8% regularly monitoring their scores. If you haven’t checked yours recently, request a free copy of your credit report and review it for any errors or discrepancies. If your score is lower than expected, focus on paying your bills on time, keeping credit utilization below 30% to gradually improve it.
Beyond credit health, it's also a great time to review and rebalance your investment portfolio. Women are often more risk-aware when it comes to investing, which can work to their advantage in building long-term wealth. A recent Crisil and AMFI study highlights a significant shift: women are not just investing, they're investing smarter and holding their investments longer. The study found that women’s mutual fund AUM with a holding period of over five years surged from 8.8% in March 2019 to 21.3% in March 2024, even surpassing men at 19.9%. Their total AUM more than doubled, from ₹4.59 lakh crore to ₹11.25 lakh crore. This patience and long-term vision allow women to stay invested through market fluctuations, making them better positioned for sustained wealth accumulation.
Update Financial Documents & Automate Finances
Ensure all your financial paperwork is up to date. Lack of information often causes chaos at the crucial times. Update your nominees for bank accounts, insurance, and investments. Organize important documents like tax returns, insurance policies, and loan agreements in one place.
Take advantage of automation to make financial management effortless. Set up automatic bill payments to avoid late fees. Automate monthly investments so you never miss contributing to your future. Use budgeting apps to keep track of your finances in real-time.
By decluttering accounts, optimizing investments, and setting clear financial goals, you’ll gain more control over your money, and ultimately, your future. So grab a coffee, sit down with your finances, and give them the refresh they deserve.
Happy spring cleaning!