Recently a friend and I were talking about debt. (I know! We talk about such exciting things sometimes.)
She financed a major business purchase last year and is in debt—not counting her mortgage—for the first time in years. The balance isn’t large; she’s scheduled to pay it off by midsummer. For her business, the purchase was worth it.
She’s a smart cookie, and thought carefully about the financial implications of the loan before she signed the papers. But the debt has been costly in ways she didn’t expect.
She didn’t anticipate the mental toll of the loan. She was prepared to make regular payments, but she hadn’t counted on the management the loan would require of her. It doesn’t demand much time, really, and there aren’t too many papers to file (although you can bet my friend files them away neatly as soon as they come, because she’s tidy like that). But it still takes up head space she wants to devote to more important pursuits.
She says the loan clutters up her clean open spaces.
Her workspace is tidy; her mind, a little less so. Erin Doland defines clutter as “any distraction that gets in the way of a remarkable life,” and this loan is exactly that: a distraction.
The financial obligation is low, but she’s acutely aware of the serious repercussions to missing a payment. It creates more filing, and nobody likes filing. It’s one more thing to keep track of, and nobody needs one more thing to keep track of.
I hate clutter (which is not the same as not having any, alas). Physical clutter shorts out the circuits of my easily-overwhelmed brain. Mental clutter—those swirling fragments consisting of unfinished tasks, grocery list items, books I forgot to add to my TBR list, phone calls I need to make later—weigh me down so much that sometimes I’m unable to function until I do a good brain dump.
But I’d never considered the potential clutter of my personal finances.
After our chat, I began sifting through my bank accounts and my filing cabinet. I was appalled at how much excess I found. (Not on the bottom line.)
Over the years, we picked up unnecessary accounts one by one—the usual way, I suspect. We were required to open a savings account at the bank that held our home mortgage back in 2007. We paid off the loan; we still have the account. We have five savings accounts, as a matter of fact. We use one of them. Those other four are clutter.
Will has four retirement accounts from four previous jobs that need to be rolled over. We keep meaning to do it; we never do. Those four accounts remain nagging tasks on our to-do list. Clutter.
I have two store cards—the kind you open to get a killer deal on your first purchase—that I haven’t used in five years. They take up space in my wallet, show up on my credit report, fill my mailbox with promotional offers. Clutter.
We had good reasons for opening all our accounts, but they became pure distractions when they outlived their usefulness. Even good things—like my friend’s loan—may hold a distraction factor.
I’ve been a wee bit obsessed of late with streamlining my life—what I wear, what I eat, the structure of my day-to-day—so I can focus on what matters most. It feels like playing whack-a-mole: as soon as I conquer one area, another pops up to take its place. Hellooo, personal finances. I was shocked to discover how much clutter you were hiding.
I’ll be closing some savings accounts this week, and maybe even googling the dreaded rollover thing.
It’s a pain, but it’s worth it.
I’d love to hear what surprising sources of clutter you’ve unearthed in your own life, and how you managed to deal with them.