HeartWork Organizing

Helping you find peace and purpose through organization and design

Saved Again by Organizing An Emergency Fund March 13, 2012

Filed under: Financial Organizing — HeartWork Organizing @ 2:00 pm
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How are you doing on organizing your finances?  Do you have an emergency fund?

organizing for emergencies

Yeah, you snort, that and a live-in butlerWouldn’t both be nice?

Let me share a real-life story about how an emergency fund helped one person, and how you can get your own.  If you read stories like this and think, this isn’t real life, let me tell you, this is very real life!

One of my organizing clients has been working on a few organizing goals for about the last year, while employed with a temp job.  A few months ago, she got serious about paying down debts and stashing an emergency fund.

We agreed she should quickly stash $2,000 in an emergency fund.  To do it, she re-allocated some extra money that she was sending to pay down a credit card account, she completely cut out spending $30 per week on clothes, and she paid more attention to her food and eating out expenses.

At first, she was worried that by diverting some of her cash into a savings account, she was hurting her other goal to pay down credit card debt.  However, when I explained that the next “crisis” would cause her to rack up more credit card debt without having some cash in reserve, she got on board.  Without a cash emergency fund, credit card debt will grow because there is no other alternative to tap when a crisis hits.

It only took her a matter of weeks to pad her hard-to-access savings account (not her regular savings account).  Then, the inevitable happened; her car broke down.  Here’s the email she sent to me:

“I have to tell you something.  My car needs major repairs.  It’s not driveable.  If you hadn’t advised me to start an emergency fund several months ago, I would not have had the money to get the repairs done.  At all.  I am extremely disappointed that I have to use up at least $660 of the $1650 I have saved thus far, with great effort, but one thing I am not is panicked — thanks to you.  This is exactly the type of emergency you wanted me to start the fund for, and your advice could not have been more timely.”

On the same day she sent this to me, I had just paid over $700 for four new tires.  Yes, I used my credit card at the register, but I transferred the money from my emergency account over to my credit card account when I got home.  Done.  I’ve been doing this for well over a decade, and our emergency account covers these kinds of things, so financial snags aren’t really emergencies, they are just life events. I sleep a lot better now than I did in my twenties.  Marketplace Money calls this the FU fund.  Or the “See Ya” fund.  Call it whatever you want, it is how you can get ahead, too.

To get your emergency account going, follow the same strategies that my client used:

1.  Figure out if you can divert money from other obligations, like credit cards, just for a short time.

2. Find your splurges and halt them, just for a short time.

3. Part with anything valuable but unused, and sell it on CraigsList or similar.  $50 here or there can be way more valuable than a dust-catcher lurking in your basement.

4. Take a part-time gig if needed.  Tutor, mow lawns, whatever it takes to add a few bucks to your balance.

5. Monitor necessities.  Cut back on groceries, cable, cell phone service, whatever else you might normally think is non negotiable, even just for two months.  A little here or there can get you to your $2,000 faster.

6. Stash the money in a hard-to access account, like at an online-only bank or a credit union you don’t normally visit.

Once you have your emergency built up to $2,000, then start paying down credit card debt again.  Once that’s paid off, then you can really grow your emergency fund to cover the recommended 3-9 months of living expenses, which can really come in handy.  You see, my client lost her long-term temp job a couple of weeks ago, and she’s back to searching for full time employment.  Uncomfortable?  Yes.  Crisis?  No, thanks to an emergency fund that was waiting for life to happen.

If you love these ideas, please read more over at Dave Ramsey’s Financial Peace  site.

all photos:  Copyright (c) 123RF Stock Photos


Forget Resolutions: Do This One Thing and Sleep Easier January 2, 2012

Filed under: Business Organizing,Financial Organizing,Organizing — HeartWork Organizing @ 1:53 pm
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How to store tax files for 2012And, by the way, forget the resolutions.  Who ever thought up that idea, anyway?

But here is one thing you can do in three minutes or less that can make a real difference for you this year.  Not kidding.  Right now.  Read this, and then run to find your nearest file folder, oversized envelope, or empty box.  Yes, you can even repurpose a gift box if you need to.

Use any box, file, or envelope you have for tax files

Label this folder, oversized envelope, or gift box with a thick, dark marker:  TAXES, 2011.

Set this folder, envelope, or box aside in your home office, or near where you process your mail.  If you share your home, let your spouse know where this is and what it is for.  Start filling it with items you might need to file your taxes this year.  You’ll start gettting these items in mid-January, possibly through February.  You might already have a few receipts or pages to add right now.  But if not, you’ll find them over the next few weeks.  When you find stuff that is or might be tax related, just pop it in here without worrying about organizing it.  Get something in email that you might need?  Save your sanity today by actually printing it out and popping it in the safe spot you just created.  Do you run a small, disorganized business from home?  Start pulling all of your records together now, and you’ll have what you need come crunch time.

Important tax records include W2’s, 1099’s, receipts for charitable gifts and donations, 529 records (contributions or expenses), end of year banking statements, refinance records, energy-saving home improvement records from the past year, and, of course, any unreimbursed work expenses.  If you aren’t sure whether it might be tax-related, pull out last year’s (2010) tax return and use that as a guide.

Don’t organize this stuff until you get ready to prepare your taxes; you are weeks away from that.  Right now, you are just trying to corral the little buggers that you’ll need for your 1040.

There.  Done.  You’re all organized, and it’s only day 2 of the new year.  Good for you!



Copyright (c) <a href=’http://www.123rf.com’>123RF Stock Photos</a>


7 Organizing Tips for Medical Records at Year End December 20, 2011

Filed under: Financial Organizing,Organizing — HeartWork Organizing @ 1:57 pm
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Organizing Medical Records

Near the end of the year, you may be thinking about clearing out your medical savings account, organizing medical paperwork for tax time, and scheduling year-end medical appointments.  Do you know the rules?

Read the full article on how to use these seven tips to organize medical records and expenses.

1.  Will your medical expenses be tax deductible?

2.  Do you have a medical savings account or flex-spending account (FSA)?

3.  Have you used up your medical savings account or FSA?

4.  Are you saving Explanation of Benefits (EOBs)?

5.  Have you stashed away medical articles?

6.  Still looking for receipts that might be tax-deductible?

7.  Did you develop a chronic condition this year?

Not sure of the answers?  Read the full article on organizing medical records, originally published in About One.

Have you started getting organized for tax season?

Photo Credit:  Copyright (c) 123RF Stock Photos


How to Save Passwords, Please September 23, 2011

Filed under: Business Organizing,Financial Organizing,Organizing,Tech — HeartWork Organizing @ 12:36 am
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Quick, do you know the best way to save passwords?  How to store passwords?  How to remember passwords?  Here are some of my favorites for offline, online, or on your computer.

Where to Save Passwords Offline

If you want to save passwords offline, I like the On Line Organizer. It is about the size of the Hallmark calendars that many people still carry in their purse, and inside it has tabs A-Z.  On each page you can store a company or URL, User name, and Password.  The size and the A-Z indexing make it very easy to use at your desk or carry it with you.  I use and sell these lovely babies for $10.  They come in a two pack, so you can carry one and keep one at your desk, or give one to your honey or best friend.  Click here to order and make saving passwords easier.

How to Save Passwords with the OnLine Password Organizer

The Best Way To Save Passwords

How to Save Passwords with the On Line Password Organizer- Interior

Save Passwords from A to Z

How to Save Passwords Online

Online, there are many programs and apps that allow you to save passwords to an encrypted site.  LastPass is the one I’ve been trying out for the past few weeks, but since it has limitations when using iPad, I’m not able to recommend it for iPad users just yet.  I want something that works as seamlessly as Evernote.  But at my PC, LastPass does a great job of capturing login and passwords from every site I visit, and then auto-populating it when I return. You don’t need to remember passwords, you just need to remember one password.  Because the data is encrypted, it truly is about as secure as anything gets on the internet. Oh, and it’s free.  You can look into other password manager programs here.

I recently learned that some of the newer browsers are able to store passwords, too.  I don’t know about you, but I have no intention of letting Microsoft hold all my passwords, even with encryption.  I’m pretty sure Bill Gates isn’t going to try to hack my PayPal account, but it gives me the shivers nonetheless.

How to Store Passwords on Your Own Computer

The last option to store passwords is on your computer.  Before you go this route, be sure that your system has the latest version of a strong security/antivirus program and that the program is doing auto-updates often.  This would be McAfee, Norton, AVG (which has both free and paid anti-virus software), or similar.  If this works for you, then just type up a simple document or spreadsheet to remember passwords, and then encrypt the file.  You can find encryption programs like EncryptFiles, which is another free program.  My thanks to Jim at HelpDotNow for passing this along.  I do not personally use this approach or software, but it would be pretty simple.

If any of these options helps you, I hope you’ll let me know.  And remember that you can order your own 2-pack password keeper for $10 right now.  Ten bucks is a pretty small price to pay for your sanity.  (They also make great teacher’s gifts.)

**Please remember to always consider your business and personal needs and consult with an advisor before making business decisions.  HeartWork Organizing accepts no responsibility from any actions you may incur from this or other advice.


How to Create Passwords September 21, 2011

Filed under: Business Organizing,Financial Organizing,Organizing,Uncategorized — HeartWork Organizing @ 1:29 pm
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It seems that absolutely everything, on and off the web, requires a password these days.  When creating passwords, stay away from obvious personal information like your birthdate, kids birth dates, anniversary,address and pets names. Use multiple words and non-words, things that can’t be found in the dictionary.   Jim, my tech expert from HelpDotNow tells me that run on sentences like ILIKETREES are good because a hacking program will have a harder time as this is a “word” not found in the dictionary and hacking programs are not generally stopping to parse the phrase into words.  Changing some elements of the word with capitals, numbers, or special characters, like ILIketr33s, is even better, but still relatively easy for you to remember.  If you can remember passwords, or at least the few that you use most often, that will save you time.

Computer experts would not recommend this, but in real life, consider having three different types or categories of passwords.  The first type would be for high stakes sites like a bank account, PayPal, email account, or an encryption program.  They should be pretty complex but still something that you can memorize.  The second level would be for useful sites, perhaps those like computer support sites and other shopping sites you frequent.  The third type of password could be almost a throw-away, something that you might use for a site you’ll never intend to visit again. Decide how much effort you want to put into each type of password, and design them as secure as you can for each level.

Now that you have your passwords, how do you organize them and where do you store them?  Hint: a sticky note is not the best answer.  Stay tuned for the next rivetting post.


Is it Better To Consign or Donate? The Economics of Purging September 8, 2011

Babies don’t stay babies for long. My babies have grown out of baby bug rattles and what seems like thousands of adorable outfits.  I can’t store them all, so I thought I’d try consignment sales. My clients are often tortured with the idea that by donating their goods, they are somehow losing money.   Is selling at a consignment sale or store, on eBay, or on CraigsList any better? I decided to run the math on my own involvment in a community consignment sale and see how it compares to donation values.

Let’s set aside the emotional distress tied up in pawing through teeny tiny clothes, hand-knitted sweaters and beautiful booties. Look, I’m a professional, and even I did a mini fashion show for my husband as I tagged items for sale. (Aaaaw, remember her in this cute little outfit? It hardly looks worn!)

Let’s examine facts. I had about 250 outfits, shoes, and baby gear that were consignable:  in good shape, no stains or tears, matched in complete outfits, and basically looking like-new.  I signed up to be part of a local one-day consignment sale, but working with a consignment store is similar.

First came the scramble for child-sized hangers. Clothes on hangers tend to sell better. Every dollar spent on prep reduces profit, so I scoured Freecycle and hit up friends and clients, but it was tough coming up with enough extra hangers.  I used adult hangers for many outfits.

Using straight pins to attach sale tags is tough on the buyers. One DollarTree package of safety pins, cost, yep, just one buck. Sale tags were provided by this event host, but some sales require consignors to print tags at home, adding paper and printer ink costs.

Then came the real cost. Little outfits had to be unpacked, put on hangers, steamed or ironed, grouped and priced. I spent at least 10 hours, maybe 15 hours or more.  At minimum wage of $7.25 my “cost” for time spent would have been at least $73 bucks.

Last, I trekked to the sale site for drop off. Loading items and delivering to the sale site took a little more than an hour, so rack up another roughly $10 in opportunity cost and aggravation.

Now comes the fun part. Each sale works a bit differently, so read up on what’s available in your area. This sale gives 60% of the proceeds back to the consignor, which is pretty good.  I opted to volunteer at the sale and earn a higher percentage of the earnings, in my case 75%.  I donated two hours of time for greater profit and an additional shot at end-of-day markdowns.  I scored big, getting an all-wood three-piece play kitchen, which I look forward to repainting “Pottery Barn Pink”, for just $10.

I priced just about every item at $2. Price items to sell, for sure. Remember, folks, pricing something unreasonably high at a consignment sale actually lowers your chance of earning any profit at all. Most people come to these sales for deals and steals, so play along or don’t play.  And really, you’re done with it, so let it go and feel happy it’s getting another life.

  • potential gross = $500
  • potential take = $375 (that’s 75%)
  • potential net (minus my costs) = $292

My results?

  • actual gross = $192
  • actually paid to me =$144
  • actual net (minus my costs) = $61

I’m not surprised that $61 is just about what I spent that day at that very same sale. I received a check two weeks later. Unsold items can be donated by the host, but I picked up mine to take to another sale or perhaps donate for the tax deduction.  That means I dragged home 150 outfits, which was no easy haul back out to the car.  They are still worth another roughly $75 back on my taxes when properly documented.

So was it worth it? About one-third of taxpayers itemize deductions, and we can claim charitable donations on Schedule A. If I had bagged and dropped off those same 250 items at my local Goodwill, I would have been able to assign a thrift value to them of the same $2, and taken the deduction on my taxes next April.  My donation would have reduced my taxable income by the value donated ($500), and reduce my tax bill by roughly $125. (Note: Taxes can be confounding.  Please talk with a tax advisor for specifics.)  Hmmm, that is suspiciously close to my net earnings on this sale, but without the time that I spent preparing, dropping off and collecting my unsold items, and volunteering at the event. Click here for one guide to donation values.

So should you or shouldn’t you?  If you enjoy consignment sales, if you could use the cash more than the time, or if you have some trendy, high-quality items that you know people are willing to pay top dollar for, then go the consignment route. I appreciate it, because I’ll probably be buying your stash.  Watch out for emotion, though, since the longer you wait to consign, the less likely your stuff will be current and desirable. If, however, time is more valuable to you, then donate your goods to a charity like Goodwill or any local charity that will provide a receipt for tax purposes, knowing that the financial outcome to your bottom line will likely be about the same.


Add Energy to Your Decision Making August 10, 2011

Filed under: Financial Organizing,General,Organizing — HeartWork Organizing @ 2:29 pm
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“Clutter represents delayed decisions,” (Barbara Hemphill) applies to lots of types of clutter and almost any decision.

A friend asked me to write about the choosing an energy supplier in Pennsylvania, where state residents have now been able to choose their electric supplier since January 2011.  This deregulation and the marketing blitz that comes with it causes trouble for those who aren’t so good at or who hate to make decisions.

Not making a decision is, in fact, a decision.  Sure, you can stay with your current provider, the lights will stay on, and you’ll still get a bill.  No harm there, and if this is your choice, move on with your life without guilt.  Of course, the problem with this is that you are leaving money on the table.  It’s not a lot of money, in my case between $10 and $15 a month, and you can simply chose to keep paying that.

I started working at one of the big phone companies in the 1990’s not long after one of the biggest deregulation cases in history, upgrading customers to more economical plans to keep them from jumping ship to a competitor.  Customers were saving money and had the same service no matter who they went with.  I don’t mean they had similar service; in many cases (not all) they had the exact same service that I was selling.  The same thing is going on in the electric industry today, as most of the companies marketing to you are reselling power and not producing it, so you’ll receive the same exact service no matter who bills you.

In a few cases, you’ll also have another decision about whether to buy sustainable power from your chosen supplier.  The sustainable power is still usually less expensive than your current default provider, but it is a teensy bit more expensive than a reseller’s base option so they can invest in alternative energy, like wind and solar farms.

One friend told me she hadn’t made a choice on energy suppliers because when she had chosen providers before, her first two choices had gone out of business a few months later.  There was no harm done, since the service always reverts to the default provider, but she lost a little confidence about her ability to chose this time around.  Our country learned a lot when we deregulated the phone company in the 1980’s.  As a result, all of the offers you’ll be seeing in the mail will have competitive rates that may or may not be guaranteed for some period, contracts that last about a year, billing that is pretty easy to understand through the default provider (PECO in my case), and maybe a promotional gift involved.  The one I received in the mail today offers a $50 VISA card, but I only looked at the letter for research, not because I’m interested in switching.

I switched providers back in January to my energy co-op.  (Full disclosure:  I will earn a token gift if you sign up and mention my name, but even if you don’t, they are worth checking out.  This is not a paid post and I do not sell energy services.) They’ve provided my home heating oil for years and, like a credit union, I like that they are working for the community and not investors.  They aren’t digging the coal or drilling the oil to provide my electric; they are providing the business that I interface with, and they offer sustainable solutions.   Like Target and Wal-Mart don’t manufacture their products (not even the ones with their brand!), they simply aggregate the choices so I can make one trip to the store.

Compared to the PECO rate of $.1042, I’m paying $.0928 per KWh for now,  but I can always make a different decision.  PECO’s  rates to compare and those of other companies do change several times a year, but for the small amount of money involved, I’m not going to spend a lot of time checking and rechecking my current deal.  I’ll probably check into it once a year, like when I renew my oil contract or maybe around tax time.  I’m not locked in, but I am saving about $10 each month, and I don’t have to ever open another envelope marked, “Save on energy” if I don’t want to.

So if you haven’t made your choice yet, talk to the very next friend who tells you they are reselling energy solutions, or send back the reply card for the very next company who asks you to switch.  If they are offering rates below $.11 or so, you’ll make a bit of money now and you’ll still have choices in the future.  And you can finally recycle all of those other mail-in energy offers you’ve been hoarding to review when you had a bit more time, which we both know is never going to make it to the top of the to-do list.

If this post didn’t answer your questions on how to chose an energy supplier, please comment below and let’s talk about it.