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Hark back yonder and the boxes were overflowing, spilling over their clearly defined boundaries. There was junk all over and it was hard to keep track of what was what.
I’m not referencing physical stuff but financial stuff.
At one point, I had 12 accounts from saving and checking to retirement and brokerage. It was so much that it filled the entire screen like a sad, blocky version of digital coloring.
I can’t remember the exact thought, but there was a thought to streamline it down to something simpler, not only for sanity but for consolidation. Consolidation is queen and reigns supreme with compounding.
No Apologies Net Worth
I didn’t realize I had a problem until I started tracking my net worth.
I delayed tracking my net worth for as long as possible. It was when I started making aggressive financial goals that I had to put all the accounts on one page.
I waylaid and delayed because I had a gut feeling my net worth was low.
I was wrong about condensed milk with mac and cheese, the fanny pack comeback, and all my ex-boyfriends.
Was I wrong about my net worth?
It took months to get over my starting point. I lamented over wasted purchases and poor life choices, but once I started to see it grow, even by a small amount, it took the sting out of my expectations.
Rarely are beginnings big and impressive, more like small, cute, and awkward.
Rollover Retirement Requirement
Once the net worth was open for the pitfalls and waterfalls, it was easy to see that I needed to declutter my accounts.
I had 5 retirement accounts and 2 robo investments.
I was an account hoarder.
It took a while to realize the issue, but once I did, I started calling and researching the best options for turning account clutter to declutter.
TSP (government version of a 401(k)) had the best expense ratios for retirement accounts, so I rolled 2 accounts into that even though I wanted to transfer all my retirement accounts.
The fed 401(k) only accepts Traditional IRAs and former 401(k)s. I had a Traditional IRA from a long-bygone employer and a 401(k) from a library stint. Combined they were less than 10k, but after a little geoartibrate, they were living their best life with fewer fees and consistent contributions.
After consolidated the 401(k)s and Traditional IRAs, what lingered was a Roth IRA. It began at my bank but quickly moved to Vanguard where their DIY investing platform with its low expense ratios is how I keep my account green and growing.
Once retirement was situated, next was brokerage accounts.
I was dabbling in the wild world of investing and the multiple accounts were proof of that. Eventually, I got to a point where I wasn’t interested in someone else investing my money even if they asked appropriate questions and were AI.
Since consolidation is queen, I fused the accounts and lumped them into a Vanguard brokerage account where I invested in index funds because my stint in stock picking was brief and unpleasant.
Once I realized market averages were better than anything I could pick, I was all in on index funds. A trend that has continued even as the markets have fluxed more than the DeLorean’s flux capacitor.
About 6 months later, my accounts were decluttered and no humans were harmed.
Some of that time was spent mulling over financial adjustments and letting my inner worrier settle down. Change, especially with personal finances, brings up all sorts of future projections that are valid or very invalid.
Then once the decision was made, I had to start telling people about it. Mostly the people who were housing my money. As with many adulting tasks, rollovers caused a gauntlet of phone calls, paperwork, signatures, and mail.
And the questions. So. Many. Questions.
As a kid, I had to answer my parent’s inquiries when I did something questionable like eating a jar full of sugar. As an adult, I get interrogated by banks when I want to move my money.
Plus, there were delays like when the banking overloads wanted a wet signature, not a digital signature, or when I had to wait for responses from departments whose customer service agents said, they don’t do this very often.
The financial Valkyrie, Piggy, over at BGR sees my financial situation, “When you roll over a 401k retirement plan to a new financial institution, your old bank no longer gets to profit off of your little retirement nest egg. And that bums them out! So, while I’m not saying they deliberately make it hard for you to roll over a retirement plan… they also don’t have much motivation to make the process easy, transparent, and fast.”
Consolidation is Queen
Similar to chess, consolidation is queen, and she reigns supreme.
When I open my net worth in my excel spreadsheet, it’s easy to tuck into my Monte Carlo calculations that I have an uncomfortable habit of losing myself in.
It’s easier to ponder my financial future when I have fewer accounts to greet me. As prescribed by my human condition, more options equal choice paralysis. If I want to keep green and growing, I need to avoid clutter and chaos, one account at a time.