How to Manage Your Money with ADHD
Do you forget to pay bills, need help with your taxes, or just want to get better at managing your money? These expert tips will help you get your finances in order with simple solutions like giving yourself an allowance and paying bills online.
Here we are at the beginning of a new year. Time to turn over a new leaf and create a financial record-keeping plan that is ideal for adults with attention deficit disorder (ADHD). Many financial organization systems won’t work for adults with ADHD because they require too much time, too much paper, and too much attention to detail. So what will work? Simplicity and consistency.
One of the most important financial tasks we face is to control daily spending. Don’t worry — I’m not going to recommend keeping a record of every chewing-gum purchase. Instead of tracking your expenditures, track what’s in your wallet. This requires no record-keeping.
Here’s how it works. Look at your monthly budget and decide what you can afford to spend each week — for impulse purchases and non-necessary expenses, such as video rentals, movies, coffee, and incidentals. That amount is your weekly allowance. (Remember, this allowance doesn’t cover groceries, major entertainment expenses, or clothing. You’ll need separate budget items for those.)
Go to your ATM on the same day each week to withdraw your allowance. Friday is a good day, because most incidental spending happens on the weekend. As you go through your week, you’ll know immediately if you can afford to buy a CD, order a pizza, or pick up a magazine. Just check the cash available in your wallet.
If you spend a lot over the weekend, a quick glance at your wallet will tell you that you need to make your lunch during the next week and skip your daily Starbucks visit. No record-keeping needed — just stick to your decision not to return to the ATM until the following Friday.
Pay Bills Online
Online bill-paying is one of the most ADHD-friendly things to come along in years. Setting it up requires a little work, but, once done, you can pay all of your bills on your computer. You can set up automatic payments for your regular monthly bills — no misplaced envelopes or late fees — and log on as needed to pay irregular and occasional ones.
For bills that vary in amount from month to month, schedule an automatic payment that is slightly larger than your typical balance, so you’ll be sure you’ve covered the bill. You’ll gradually build up enough credit to cover a bill that is larger than average.
Balance Your Checkbook
Signing up for online banking will turn the hit-or-miss process of balancing your checkbook into a thing of the past. Your online account will list all deposits and payments, tracking your balance automatically, to the penny, every day. No more worrying about — or being unpleasantly surprised by — forgotten ATM withdrawals, and errors in addition and subtraction. If you’re struggling with balancing your checkbook but aren’t ready to move your banking to the online world, ask a family member to take over. When this is not possible, and you can’t figure out why your balance never agrees with the bank’s balance, go to your bank, in person, to get help in correcting the discrepancy.
A hanging wall pocket makes a perfect receipt bin. Mount it in a room where you can conveniently transfer receipts from your purse or wallet to the wall pocket — your kitchen or breakfast room, if that’s where you “unload” mail and packages. Save only receipts that you’ll need for proof of purchase or tax-deductible expenses. Everything else goes into a recycling bag or shredding bin.
Once a month, toss all receipts from the wall pocket into a large manila envelope, seal it, and write the month and year on the front. Place the envelope in your portable tax documents file (see below). You’ve got an easy, no-file method that will allow you to find receipts in a flash.
Prepare for Taxes
Store everything you’ll need to prepare your tax return in a portable plastic file case with a handle, including your monthly receipt envelopes. As tax-related documents come in the mail, toss them into it, too. If you want to be more organized, set up hanging files by category, such as tax-deductible donations and tax-deductible business, housing, and child-care expenses. Ask your accountant or tax advisor what type of receipts you should keep on hand. The critical thing, however, is to designate a single, convenient place to deposit tax-related documents, rather than putting them in a pile of papers on a desk or tabletop.
Save for Retirement
The best way to save for the future is to make saving automatic. Studies show that people are likely to keep money in savings once it’s there, and less likely to put money into savings if it requires taking an action. The solution is simple. Set up, through your bank, an automatic monthly transfer of funds from your checking account into a savings or money market account. You can invest in a mutual fund or stocks using the same hands-off method.
Tweak Your ADHD Memory
Give yourself reminders about important, but infrequent, financial activities through a computerized schedule (Outlook) or paper day-planner. You may need reminders about:
- Annual or semi-annual meetings with your financial advisor to review and revise your investment portfolio
- Dates for renewals of certificates of deposit
- Dates for payment of quarterly taxes
- Date to contact your financial advisor about preparing your annual tax return