The consequences of financial clutter

You’ve probably heard that being surrounded by physical clutter can make you feel mentally cluttered. Well, the same is true for financial clutter. And as we enter tax season, the results of financial clutter can be especially troublesome.

Financial clutter can block your progress toward a clear financial path, and the cost can be tremendous as well. The following are just a few ways clutter costs you extra money, time and stress:

  • Unpaid bills: If it’s hidden under a pile of junk mail, it’s likely it’s not going to be paid on time. Late payments can hurt your credit score. Even worse, you might come home ready for a shower and there’s no water. After checking your pipes you realize you never paid your bill thanks to the clutter in your in-box.
  • Identity theft: That statement you accidentally threw in the trash without shredding is a criminal’s treasure. Say hello to a world of heartache when he opens accounts in your name. The process to clean up your credit record after identity theft is tedious and sometimes costly.
  • Lost accounts: Sounds far-fetched? It happens all the time. Lose the paperwork and some people forget an account ever existed. Out of sight, out of mind.
  • Inability to borrow: The dossier of documents a bank requires to loan money is tremendous. If you can’t locate what they need, you don’t get the money.
  • Duplicate spending: You come home with a new purchase only to find you already have it. No surprise, though, because it’s been buried and unused for years.
  • Stress: Being unaware of exactly where you stand financially is a tremendous burden. Searching in vain for your checkbook can seriously raise your level of stress.

So with that in mind, I challenge you to approach your clutter head-on. Don’t wait until you feel overwhelmed to get a handle on your clutter. For more tips on managing and organizing your finances, download our free New Beginnings eBook.

Jessica Horton is a former copywriter and community manager at MMI.

  • The Consumer Federation of America (CFA) is an association of nonprofit consumer organizations that was established in 1968 to advance the consumer interest through research, advocacy, and education. Today, nearly 300 of these groups participate in the federation and govern it through their representatives on the organization's Board of Directors.

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  • The National Foundation for Credit Counseling® (NFCC®), founded in 1951, is the nation’s largest and longest-serving nonprofit financial counseling organization. The NFCC’s mission is to promote the national agenda for financially responsible behavior, and build capacity for its members to deliver the highest-quality financial education and counseling services.