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When you think about your financial clutter, the first thing that comes to mind is probably a pile of receipts and bills sitting in a drawer somewhere in your home.
But what about your digital clutter?
Have you ever forgotten a password because you have too many accounts? Or do you ever find yourself toggling between multiple websites and apps as you try to pay your mortgage or credit card bill? If so, then your finances may not be as digitally organized as they could be.
Digital clutter can slow down your productivity and hinder your ability to effectively manage your money. It could even be causing you to miss out on opportunities to reach your financial goals: A study by the University of Utah found that people with multiple bank accounts spend 10 percent more money than those with just one account.
Here are a few more reasons why you should get your digital clutter under control:
Your finances will be more secure
When you consolidate your accounts with one bank, you only have one username and password to remember. Not only is that a major score for your sanity, but it also means that your financial data will be better protected. After all, when your finances are all in one place, they're easier to monitor, which means you're more likely to quickly spot suspicious activity. And the quicker you spot a problem, the quicker you can report it!
There's always a bit of a delay when you move money between external accounts. It almost feels like you're losing out on interest for those few days.
You can get a better understanding of your total financial picture
It's difficult to solve a problem when you're not quite sure what the problem is in the first place. That especially applies to your finances: When you have multiple accounts scattered across various bank accounts, it can be difficult to understand how they're working—or not working—together.
On the other hand, when your checking, savings, loans and investment accounts are all in one dashboard, you can see exactly where your money is. "Having your checking and savings accounts together with your mortgage or credit cards allows you to quickly view your immediate financial situation," says Craig Hull, Marketing Strategy Manager for Chase. "You can make adjustments seamlessly to ensure you are fiscally fit."
You could even save money
In addition to giving you a better understanding of your overall financial picture and improving your security, consolidating your finances could even save you money. Many banks offer discounts when you bring all of your various accounts together. In addition to giving you a better understanding of your overall financial picture and improving your security, consolidating your finances could even save you money.
Some banks offer discounted loan rates for existing checking and savings customers. What's more, if you set up automatic payments from your existing checking account, many banks will offer a further discount. Talk to your bank to see what discounts they're willing to offer!
The solution
Cleaning up your digital finances can be easy. Start by reviewing the services your bank offers in order to make sure that it can see to all your needs. Does it offer a full range of financial services, from checking and savings to home and car loans? Does it have a robust app that allows you to view and manage all of your financial accounts?
When you've found the bank you need, look into moving your accounts there. If you have a mortgage there, think about opening a checking account and setting up direct deposit for your paycheck.
In addition to saving you time with your accounts, streamlining your digital accounts will give you a better awareness of how much money you have, how much you owe, and where you stand overall. That way you'll be better equipped to set goals, track your spending, and lay out a financial roadmap for your future.