14 Year End Organization, Financial and Tax Tips to Manage Your Personal Finances

As a chronic procrastinator I tend put all my non “attend to immediately” documents in baskets and boxes resulting in, at year end, a colourful array of documents.  There are letters, bills, invoices, receipts, statements and the occasional delivery menu that did not get filtered out.  The intention is to organize them, on a regular basis, in the near future.  In reality, this usually does not tend to happen until the end of the year.


Once I am able to beat the the urge to procrastinate and actually get into a groove (probably not what Madonna was referring to), I find organizing to be quite satisfying.  Additionally, going through all my old mail, bills etc. provides some insight my year, where I can look at what happenedand plan for the future, providing great fodder for new year’s resolutions. (Mine is to organize much earlier next year). 

Below, I have compiled a list of organization, financial and tax tipsthat can help reduce your tax bill, increase your productivity and lend some insight into your financial situation.


Colour coded folders can be purchased at most office supplies stores.  In addition to looking pretty, you can use different colours represent categories eg.  I use green folders for financial documents and blue folders for client documents relating to my small business.

Labelling should be consistent.  If you have a computer and a printer, it can be very helpful to print your labels with big bold letters, so that files are easily identified.

Filing cabinets can be fairly inexpensive and in addition to giving an air of official-ness, look great in an office or den and make finding documents much easier.

Paperless filing can be achieved by saving or scanning important documents to your computer and organizing them in intuitive categories.  This is also a great time to clean up your desktop and put everything in nice, easily locatable folders.  I also have a folder called “desktop files” for all the files on my desktop that I havea hard time filing and will probably never need again, but want to keep them just in case...

Purging your documents can be safely done for older bills, statements and receipts.  If they are not pertinent to your business or tax return, and you don’t think you are going to contest the charges it is probably safe to get rid of anything that is over a couple of years old (or even younger depending on your hoarding quotient).

Tax documentation  including tax assessments (my advice is to keep ALL documents from the Government), donations, T4s, RRSP receipts, medical expenses, investment statementsand anything that you think might pertain to your taxes should be tossed into a folder, and organized by year. 

Points balances can really accumulate.  I have a fat wallet full of points cards, which I rarely redeem (I suppose I’m a bit of a point hoarder).  It can be a very useful exercise to list all your points’ cards, balances and associated values and make a plan to redeem them. Creating an excel spreadsheet can be a great way to track and update them.   You’ll find that you are slightly richer than you think you are.

Financial and Tax:

Personal finance software can be a simple way to organize your finances and can be greatly illuminating (Yes.  You spent $8 million on lunch).  Mint has just been released in Canada.  According to this review of Mint Canada, it is very easy to set up.  It imports data directly from your bank and credit cards and categorizes it.   They have a variety of reports and useful tips to help you budget.  And it comes with a handy iphone app.

Net worth statements can help you establish how much you are worth and can usually be obtained from personal finance software.  Alternatively, if you are not interested in going through the process of setting this up, you can build your own net worth statement

RRSPs are one of the best tax savings vehicles available to Canadians.  This is a good time to estimate the maximum that you are able to contribute based on your limits and your own availability of excess of cash.  It can make sense to take out an RRSP loan, a lot of which can be repaid with the tax refund that you receive as a result of contributing to RRSPs. (Just make sure that you repay it as soon as possible).  The deadline for RRSP contributions for 2010 is March 1, 2011.

TFSAs, although not quite as beneficial as RRSPs, can be a great way to accumulate interest, dividends and capital gains, tax free.  The limit for Canadians is $5,000, per year, which can be put into a variety of investment vehicles.  The tax savings, although not immediately evident, will accumulate over time.

Investment portfolios should be reviewed to determine if there are opportunities for tax loss selling that can be offset against capital gains. 

Credit card balances that have been outstanding for more than a couple of months should be reviewed and paid off if possible.  If you are unable to pay off your balance, consider speaking to your bank about getting a line of credit which generally has significantly lower interest rates.

Donations, in addition to being a nice thing to do, can result in a significant tax savings.  To take advantage of these savings, assess your financial situation and make charitable contributions before the year end.  Similarly with Medical expenses, it may be worth getting that root canal before the end of the year as, above a certain amount, they are tax deductible.

While there is no time like the present to procrastinate, accomplishing some of these tasks can be satisfying and a great way to organize, tie up loose ends and prepare for the next year. 

Ronika Khanna is a Montreal accountant who helps small businesses achieve their financial goals.  To receive regular updates of articles pertaining to small business, accounting, tax and other topics of interest to business owners you can sign up here.  You can also follow her on Facebook or Twitter.