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If you’re often surprised when you open up your credit card and bank statements and see how much money you spent, or you worry that your cash outflow may be exceeding your cash inflow, there could be a simple solution: A personal cash flow statement.

Creating a personal cash flow statement can give you a clear picture of your monthly cash inflow (money you earn) and your monthly cash outflow (money you spend) to determine if you have a positive or negative net cash flow.

And while it may sound intimidating, creating a personal cash flow statement is relatively simple. All you need to get started is to gather up your bank statements and bills for one month (or more). Then, it’s a matter of some basic calculations.

Once you have your personal financial statement, you’ll know where you currently stand. You’ll also be able to use your personal financial statement to help you create a budget and goals for increasing your net worth.

Here’s how to start getting your financial life back into balance.

What Is a Personal Cash Flow Statement?

“Cash flow” is a term commonly used by businesses to detail the amount of money flowing in and out of a company.

Companies can use cash flow statements to determine how well the company is generating cash to pay its debts and operating expenses.

Just like the ones used by companies, tracking your own cash flow can provide you with a snapshot of your financial condition.

You might learn, for example, that you have less leftover at the end of each month than you thought, or that you are indeed going backwards.

Once you have the numbers down in black and white, you can then make any needed changes, such as reducing costs and expenditures, increasing income, and making sure that your spending is in line with your goals.

So, how do you set up a personal finance cash flow statement?

It might seem overwhelming to get started, but these steps can simplify the process.

Listing all Your Sources of Income

A good first step when creating a personal cash flow statement is to get out all of your pay stubs, bank statements, credit card statements, and bills.

Next, you’ll want to start listing any and all sources of income–the inflow.

Cash inflows generally include: salaries, anything you make from side hustles, interest from savings accounts, income from a rental property, dividends from investments, and capital gains from the sale of financial securities like stocks and bonds.

Since a cash flow statement is designed to give a snapshot into the overall flow of where your money is coming from and where it is going, you might want to avoid listing money in accounts that aren’t available for spending.

For example, you may not want to list dividends and capital gains from investment accounts if they are being automatically reinvested, or are part of a retirement account from which you aren’t actively taking withdrawals.

Since income can vary from one month to the next, you might choose to tally inflow for the last three or six in order to come up with an average.

Once you’ve collected and listed all of your income for the month, you can then calculate the total inflow.

Listing all of Your Expenses

Now that you know how much money is coming in each month, you’ll want to use those same statements and bills, as well as any statements for any debts (such as mortgage, auto loan, or student loans) to list how much was spent during the month.

Again, if your spending tends to fluctuate quite a bit from month to month you may want to track it for several months and come up with an average.

To create a complete picture of how much of your money is flowing out each month, you’ll want to include necessities like food and gas, and also discretionary expenses, such as trips to the nail salon or your monthly streaming services.

Small expenses can add up quickly, so it’s wise to be precise.

Once you’ve compiled all of your expenses, you can calculate the total and come up with your total outflow for the month.

Determining Your Net Cash Flow

To calculate your net cash flow, all you need to do is subtract your monthly outflow from your monthly inflow. The result is your net cash flow.

A positive number means you have a surplus, while a negative means you have a deficit in your budget.

A positive cash flow is desirable, of course, since it can provide more flexibility, and can allow you to decide how to best use the surplus.

There are a variety of options. You could choose to save for an upcoming expense, make additional contributions to your retirement fund, create or add to an emergency fund, or, if your savings are in good shape, consider a splurging on something fun.

A negative cash flow can signal that you are living a more expensive life than your income can support. In the future, maintaining this habit could lead to additional debt.

It’s also possible to have net neutral cash flow (all money coming in and going out is fairly equal).

In that case, you may still want to jigger things around if you are not already putting the annual maximum into your retirement fund and/or you don’t have a comfortable emergency cushion.

The Difference Between a Personal Cash Flow Statement and a Budget

A personal cash flow statement provides a comprehensive look at what is currently coming in and going out of your bank accounts each month.

A cash flow statement tells you where you are.

A personal budget, on the other hand, helps you to get where you want to go by giving you a spending plan that is based on your income.

A budget can provide you with some general spending guidelines, such as how much you should spend on groceries, entertainment and clothing each month so that you don’t exceed your income–and end up with a negative net flow.

Creating a budget can also be a good opportunity to check in with your financial goals.

For example, are you on track for saving for retirement? Do you want to amp up your emergency fund?

Are you interested in tackling the credit card debt that has been spiraling due to high interest rates?

Perhaps you want to work toward paying off your student loans.

Whatever your goal, a well-crafted budget could serve as a roadmap to help you get there.

Using Your Personal Financial Statement to Create a Simple Budget

Because a cash flow statement provides a comprehensive look at your overall spending habits, it can be a great jumping off point to set up a simple budget.

When you’re ready to create a budget, there are a variety of resources online, from apps, like SoFi Relay®, to spreadsheet templates and printable worksheets .

A good first step in creating a budget is to organize all of your monthly expenses into categories.

Spending categories typically include necessities, such as rent or mortgage, transportation (like car expenses or public transportation costs), food, cell phone, healthcare/insurance, life insurance, childcare, and any debts (credit cards/ loans).

You’ll also need to list nonessential spending, such as cable television, streaming services, concert and movie tickets, restaurants, clothing, etc.

You may also want to include monthly contributions to a retirement plan and personal savings into the expense category as well.

And, if you don’t have emergency savings in place that could cover at least three to six months of living expenses, consider putting that on the spending list as well, so you can start putting some money towards it each month.

Once you have a sense of your monthly earnings and spending, you may want to see how your numbers line up with general budgeting guidelines. Financial counselors sometimes recommend the 50/30/20 model, which looks like this:

•  50% of money goes towards necessities such as a home, car, cell phone, or utility bills.
•  30% goes towards your wants, such as entertainment and dining out.
•  20% goes towards your savings goals, such as a retirement plan, a downpayment on a home, emergency fund, or investments.

Improving Your Net Cash Flow

If your net cash flow is not where you want it or, worse, dipping into negative territory, a budget can help bring these numbers into balance.

The key is to look closely at each one of your spending categories and see if you can find some ways to trim back.

The easiest way to change your spending habits is to trim some of your nonessential expenditures. If you’re paying for cable but mostly watch streaming services, for example, you could score some real savings by getting rid of that cable bill.

Not taking as many trips to the mall or cooking (instead of getting takeout) more often could start adding up to a big difference.

Living on a budget may also require looking at the bigger picture and finding places for more significant savings.

For example, maybe rent eats up 50% of your income and it’d be better to move to a less costly apartment. Or, you might want to consider trading in an expensive car lease for a less pricey or pre-owned model.

There may also be opportunities to lower some of your recurring expenses by finding a better deal or negotiating with your service providers.

You may also want to look into any ways you might be able to change the other side of the equation–the inflow.

Some options might include asking for a raise, or finding an additional income stream through some sort of side hustle.

The Takeaway

One of the most important steps towards achieving financial wellness is cash flow management–i.e., making sure that your cash outflow is not exceeding your cash inflow.

Creating a simple cash flow statement for yourself can be an extremely useful tool.

For one reason, it can show you exactly where you stand. For another, a personal cash flow statement can help you create a budget that can bring the inflow and outflow of money into a healthier balance.

Creating–and sticking with–a budget that creates a positive net cash flow, and also allows for monthly saving (for retirement, a future purchase, or a rainy day) can help you build financial security and future wealth.

If you need help with tracking your spending, a SoFi Money® cash management account may be a good option for you.

With SoFi Money, you can see your weekly spending on your dashboard, which can help you stay on top of your spending and make sure you are on track with your budget.

Check out everything a SoFi Money cash management account has to offer today!

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External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Third Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third party trademarks referenced herein are property of their respective owners.
SoFi Money®
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC . Neither SoFi nor its affiliates is a bank. SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
SoFi Invest®
The information provided is not meant to provide investment or financial advice. Investment decisions should be based on an individual’s specific financial needs, goals and risk profile. SoFi can’t guarantee future financial performance. Advisory services offered through SoFi Wealth, LLC. SoFi Securities, LLC, member FINRA / SIPC . The umbrella term “SoFi Invest” refers to the three investment and trading platforms operated by Social Finance, Inc. and its affiliates (described below). Individual customer accounts may be subject to the terms applicable to one or more of the platforms below.

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You’ve probably heard that you should be saving money each month. It’s one of those things that’s just supposed to be good for you, like eating broccoli or flossing before you go to bed.

But why is it important to save money?

And, if you’re already stretched covering your current expenses, and possibly also paying back debt (such as student loans), you may wonder, why even bother to try saving?

The answer is that everyone has to start somewhere, and even just putting aside a little bit every month is well worthwhile.

That’s because having savings can decrease worry (since you have back-up should a sudden expense come up), help you reach your goals (such as making a large purchase or downpayment on home), and also help you earn money without doing anything at all (yes, money can do that).

Understanding why saving is important—and learning how to make it happen—might be the fuel you need to get started.

Reasons Why Saving Money is Important

It can be hard to get motivated to save money just because it’s the “responsible” thing to do. But you may see the appeal once you understand the huge advantages that saving offers. Here are a few.

Peace of Mind

If money is tight, you may find yourself worrying how you will pay the rent or other critical bills if an extra unexpected expense were to suddenly come up, as they often do.

Financial experts generally recommend building up an emergency fund of at least three months worth of living expenses to prepare for any financial surprises.

Having this contingency fund in your back pocket can provide the sense of security that comes with knowing you can get through a rough spot without hardship.

Avoiding Debt

Saving is beneficial for non-emergencies too. Say you are hoping to be able to afford a major expense in the future, such as a wedding, vacation, home renovation, or sending a kid to college.

You could finance these big-ticket items with debt, whether through high-interest credit cards, loans, or a home equity line of credit.

However, borrowing generally means that you’ll be paying more than you borrowed thanks to interest that accrues.

If you save up for your dream in advance, you can side-step debt, which can help save a significant amount of cash in the long run.

Expanding Your Options

Generally, the more money you have saved, the more control you can have over your life.

If you’re unhappy with where you live, for instance, having some savings can open up the possibility of moving to a more desirable location, or putting a downpayment on a new home.

If you dislike your job, having a cushion of savings might afford you the option of leaving that job even before you have another one lined up.

Money certainly does not solve all problems, but having savings can give you a little bit of breathing room and allow you to take positive steps in your life.

Getting Your Money to Work For You

Another big incentive to save is the power of compound interest.

Compound interest means you earn a return not just on the amount you originally put away, but also on the interest that accumulates.

Over time, that means you can end up with much more than you started with. And the earlier you start saving, the more your money grows, since compound interest is able to work its magic over a longer time horizon.

For example, a person who starts putting $100 per month towards retirement at age 25 will wind up putting $12,000 more of their money into their retirement fund by age 65 than the person who started saving $100 per month at age 35.

But because of compound interest (and assuming a 7% annual rate of return), the person who started at 25 will wind up with over $120,000 more at age 65 (way more than the extra $12,000 they invested). Please note that this is a hypothetical scenario and does not represent an actual investment. All investing involves risk.

How to Get Started with Saving

If you’re convinced that saving is the right move, how do you actually do it? The key is to make a budget and make sticking to it easy.

This doesn’t have to be intimidating. The key is to get familiar with what you spend, what you earn, and what your goals are.

Here are some steps you could take to help get started.

Figuring Out What You’re Saving For

Is it a long-term goal, like retirement or your kids’ college tuition? A short-term goal, like an emergency fund? Or a medium-term goal, like a wedding or home renovation? It can help to get a sense of how much you need to stash away and by when.

The point of this is twofold: First, you can divide the amount you need by the months left until your deadline to get a clear picture of how much you’ll need to save each month.

Second, you will know where to put your money. If your goal is less than a couple of years away, you may want to keep your savings in a high-yield savings account, cash management account, online savings account, or money market account.

These options can help you earn more interest than a standard savings account but still allow you to access your money when you need it.

If your goal is in the distant future, you might want to invest the money in a retirement account, 529 college savings plan, or brokerage account so that it has the chance to grow over time.

Sticking to a Budget

You don’t really know where your money is going unless you track it. That’s why for a month or two, you may want to take note of all your daily and monthly expenses.

Next, you’ll want to tally up your net monthly income, meaning what goes into your account after taxes and deductions.

The difference between your monthly income and your expenses is what you have left over to save. If there’s not enough left over, you can work on finding ways to cut spending or increase your income.

Putting Savings on Autopilot

If you’re manually putting cash away every month, it can be easy to fall behind.

For one thing, you may forget to move money into savings regularly amid your busy schedule. And, unless you protect the money in advance by transferring it to a different account, you may accidentally spend it.

One way to avoid this is to set up automated savings through your bank account or retirement plan.

If you’re putting away the amount you identified you need for your goal, you may get there without even thinking about it.

The Takeaway

Saving money is highly important–it can provide peace of mind, open up options that improve your quality of life, increase your wealth due to compound interest, and may even allow you to retire early.

Many people earn wealth through a combination of working and savvy saving.

Looking to save for a future goal (like buying a car or making downpayment on a home?) Consider signing up for a SoFi Money® cash management account.

With SoFi Money Vaults, you can separate your spending from your savings while still earning competitive interest on all your money.

Vaults also allow you to track your savings progress and set up recurring monthly deposits (which could help you reach your savings goal faster). Plus, there are no account or minimum balance fees.

Check out everything a SoFi Money cash management account has to offer today!

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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
SoFi Money®
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC . Neither SoFi nor its affiliates is a bank. SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.

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Financial therapy is a relatively new field that combines the emotional support of a psychologist with the money mindset of a financial planner.

Seeing a financial therapist can allow clients to begin to process their underlying feelings about money, while working out plans for retirement, savings, investments and other goals.

Financial therapists (sometimes referred to as financial psychologists) also work to lessen that stress that often comes with money concerns, and try to help their clients develop a more sustainable and healthy relationship to money.

Financial therapists can also help couples overcome differences in their approach to saving and spending, which can help mitigate money fights, and enable them to work together more as a team.

Read on to learn if you might benefit from this type of professional counseling, and, if so, how to find a financial therapist that is the right fit for you.

How Financial Therapy Works

According to the Financial Therapy Association (FTA) , financial therapy is a process informed by both therapeutic and financial expertise that helps people think, feel, and behave differently with money to improve overall well-being.

The profession sprang out of increasing evidence that money can be intrinsically tied to our hopes, frustrations, and fears, and also have a significant impact on our mental health.

According to a recent survey by the American Psychological Association , 72 percent of Americans reported feeling stressed about money at least some time in the prior month.

Money can also have a major impact on our relationships.

Indeed, research has shown that fighting about money is one of the top causes of conflict among couples, and one of the main reasons married couples land in divorce court.

And, while it might seem like bad habits and money arguments are things you can simply resolve on your own, the reality is that it’s often not that simple.

Many financial roadblocks, such as chronic overspending or constantly worrying about money, often aren’t exclusively financial. In many cases, psychological, relational and behavioral issues are also at play.

Financial therapy can help patients recognize problematic behaviors, and how various relationships and experiences may have led them to develop those behaviors as coping mechanisms or to form unrealistic or unhealthy beliefs.

Along with offering practical financial advice, a financial therapist can reduce the feelings of shame, anxiety, and fear related to money.

The reasons why financial therapy can help are the same as why traditional psychological therapy can help: It can lead people to understand that they can do something to improve their situation. That, in turn, can instigate changes and healthier behaviors.

Like conventional therapy, the number of sessions needed will vary, depending on the situation. A financial therapy relationship can last from a few months to longer.

Generally, a financial therapist’s work is “done” when you feel your finances are orderly and you have the skills to keep them that way in the future.

Financial Therapists vs. Financial Advisors

Financial advisors are professionals who help manage your money.

They are typically well-informed about their clients’ specific situations and can help with any number of money-related tasks, such as managing investments, brokering the purchase of stocks and funds, or creating a tax plan.

However, psychological therapy is not a financial advisor’s area of expertise, and if a person requires real emotional support or needs help breaking bad money habits, a licensed mental health professional, such as a financial therapist, should likely be involved.

A certified financial therapist (someone trained by the FTA) can work with you specifically on the emotional aspects of your relationship with money and provide support that gets to the root of deeper issues.

Due to the interdisciplinary nature of financial therapy, professionals that enroll in FTA education and certification include: psychologists, marriage and family therapists, social workers, financial planners, accountants, counselors, coaches, students and academics.

Do You Need a Financial Therapist?

If you’re considering whether a financial therapist could help you, you may want to think about your general relationship to money.

If you feel you have anxiety about money, or unhealthy behaviors and feelings when it comes to spending, budgeting, saving, or investing, you might benefit from exploring financial therapy.

Some red flags that you might benefit from a financial therapist include:

•  Chronically paying bills late.
•  Holding unhealthy spending habits (such as gambling or compulsive shopping).
•  Overworking oneself to hoard money.
•  Completely avoiding financial issues that need to be addressed.
•  Hiding finances from a partner.

Often, unhealthy saving, spending, or working habits are a symptom of other bad habits related to mental or physical health.

Keep in mind that it’s possible to have an unhealthy relationship with money even if your finances are good on paper.

Finding a Financial Therapist

Like choosing any therapist, you often need to shop around a bit to find the right fit—someone you feel you can relate to, trust, and you also feel understands you.

For those who may not have access to a financial therapy professional in their backyard, many offer services via video conferencing.

You can start your search with the Find A Financial Therapist tool on the FTA website, which features members and lists their credentials and specialties.

Your accountant or financial counselor might also be a good source of referrals.

As with choosing any other financial expert or mental health professional, it’s a good idea to speak with a few potential candidates.

In your initial conversations with candidates, you may want to discuss the therapist’s training and expertise, as well as your needs and situation.

Financial therapists have a wide variety of backgrounds, so it is important for consumers to learn as much as they can about that individual’s practice, expertise, and ability.

You may even want to ask them how they define financial therapy themselves because approaches and definitions vary from one professional to another.

It can also be a good idea to ask how long they have been providing financial therapy services, what their fees are, as well as if some or all of the fee may be covered by your medical insurance.

The Takeaway

Financial therapy merges finance with emotional support to help people cope with financial stress, learn to make better financial decisions, and develop better money habits.

If you frequently feel stressed and/or overwhelmed when you think about money–or you simply avoid thinking about money as much as possible–you might be able to benefit from at least a few sessions of financial therapy.

While it might seem like hiring a financial therapist is another expense that could complicate an already difficult financial situation, it might be better to view it as investment in your emotional and financial wellness, one that could help you build financial stability and wealth in the future.

Another way to get–and stay–on top of your finances (that you do on your own) is to open a SoFi Money® cash management account.

SoFi Money can help simplify your financial life by allowing you to earn competitive interest, spend and save–all in one account.

And SoFi Money makes it easy to track your weekly spending and saving in your dashboard within the app.

Check out everything a SoFi Money cash management account has to offer today!

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SoFi Money®
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC . Neither SoFi nor its affiliates is a bank. SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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Your credit report contains a detailed record of your past use of credit, and can have a big influence on your life.

Whenever you apply for a loan, lenders will typically look at your credit report (either a hard or soft credit inquiry) to decide whether or not to lend to you, as well as how much interest to charge.

Potential employers may also check your credit. And, your credit report may be pulled when you are trying to rent a home, connect utilities, or get a cell phone.

Since credit reports are so important to so many aspects of your life, it’s essential they’re accurate.

Unfortunately, they have more errors than many people may realize. According to the Consumer Financial Protection Bureau (CFPB), one in five people have an error on at least one of their credit reports.

While a misspelled name or incorrect bank balance might not seem like much, it could be impacting your credit score, and hurting your ability to get new lines of credit, or making the terms of the credit more expensive. Ultimately, these errors could be costing you money.

That’s why it’s important to periodically check and monitor your credit reports.

This can help you ensure that the information being used to calculate your credit scores is accurate and up to date. It can also alert you to fraud or identity theft.

In addition, when you’re working on building credit, it can be helpful to see what potential creditors see when they check your credit.

Getting a hold of, and checking, your credit reports from the three major bureaus–Equifax , TransUnion and Experian –is relatively easy, and also free.

Here’s how to do it, and key things to look for when reading your reports.

Getting a Credit Report

Like going in for a check-up once a year can benefit your physical health, regular credit report check-ups can benefit your financial health.

Everyone is entitled to see their credit reports for free once a year at the government-mandated AnnualCreditReport.com site.

It’s a good idea to take full advantage of this service, and to look over your reports from the three major bureaus annually.

Checking your credit report regularly can also make it easier to notice when the numbers look off or if something’s amiss.

Scanning a Credit Report

The best way to find an error in a credit report is to read through it thoroughly.

The CFPB recommends making sure that the following information is accurate:

•  Name
•  Social Security Number
•  Current Address
•  Current Phone Number
•  Previous Addresses
•  Status
•  Employment History (names, dates, locations)
•  Current Bank Accounts Open
•  Bank Account Balances
•  Joint Accounts
•  Accounts Closed

If any of the above is incorrect, the report has an error that you may want to dispute.

Common Credit Report Errors

While there are any number of errors that could crop up on a credit report, some are more likely than others. According to the CFPB, these are among the most common:

•  Typos or wrong information. In the personal information section, names could be misspelled, or addresses could just be plain wrong.
•  A similar name is assigned to your report. Instead of a typo, the credit report might be pulling in accounts and information of a person with a similar name to yours.
•  Wrong accounts. If an account is in your name but unfamiliar to you, this could be proof of identity theft.
•  Closed accounts are still open. You may have closed a savings account or credit card recently, but the report shows it as still open.
•  Being labeled “owner” instead of a user on a joint account. If you’re simply an authorized user on a joint account or credit card, your credit report should reflect that.
•  False late payment. A credit report might show a late or delinquent payment when the account was paid on time.
•  Duplicate debts or accounts. Listing an account twice could make it look like more debt is owed, resulting in an incorrect credit report.
•  Incorrect balances. Account balances might show incorrect amounts.
•  Wrong credit limits. Misreported limits on credit card accounts can impact a credit score, even if they’re only off by a few hundred dollars.

How to Report an Error

Errors on credit reports don’t typically fix themselves. Account owners often have to be the ones to bring the error to the credit bureau’s attention.

Here are steps to take if you find an error in one of your reports.

1. Confirming the error is present on other credit reports.
Credit scores may vary across credit reporting bureaus, but all the core information should be the same. That means if there’s an error on one, it’s best to check that it’s on the other two. You can order free reports from all three bureaus–Experian, Equifax, and TransUnion–from the free Annual Report Site , and check each report against the others.
2. Gathering evidence.
To prove an element of the credit report is wrong, there needs to be evidence to the contrary. That means you’ll want to collect supporting documentation that shows the report has an error, whether that’s a recent bank statement, ID, or a loan document. Having this documentation on hand can make the process move faster.

3. Reporting the error to the credit reporting company.
To resolve the error, you’ll want to file a formal dispute with the credit reporting company. That means sending a dispute via snail mail (using this template from the CFPB ) or filling out a form online at the company’s site (listed below).

It’s important to make sure to include all documentation of the error, in addition to proper identification.

Here’s how to contact each credit reporting company:

Equifax

Online Dispute Form
Mail dispute form to:

Equifax Information Services LLC
P.O. Box 740256
Atlanta, GA 30348

Experian

Online Dispute Form
Mail dispute form to:

Experian
P.O. Box 4500
Allen, TX 75013

Transunion

Online Dispute Form
Mail dispute form to:

TransUnion LLC
Consumer Dispute Center
PO Box 2000
Chester, PA 19016

4. Contacting the furnisher (if applicable).
A furnisher is the company that gave the credit reporting bureau information for the report. If the report’s mistake is an error from a bank or credit card company, you can also reach out to the furnisher to amend its mistake. You can contact the company through mail (the address can be found on the credit report), or reach out to customer service by phone or online.

If the furnisher corrects the mistake, it could, in turn, update the credit report. But, to play it safe, reach out to both parties.

5. Reaching out to the FTC to report identity theft (if applicable).
If you notice an error that suggests identity theft (such as unknown accounts or unfamiliar debt), it’s a good idea to sign up with the Federal Trade Commission’s (FTC’s) IdentityTheft.gov site in addition to alerting the credit bureaus. The FTC’s tool can help users create a recovery plan and figure out the next steps.

6. Sitting tight and waiting for a response.
Once someone sends a credit dispute to a bureau or furnisher, they can expect to hear back within 30 days, typically by mail.

When a credit bureau receives a dispute, they have one of two choices: agree or disagree. If the bureau agrees, they will correct the error and send a new credit report.

If the bureau disagrees and doesn’t believe there’s an error, they won’t remove it from the report. In some cases, they may not agree there’s an error because there’s a delay in information getting to them.For example, a recently canceled credit card might not show up as canceled in their records yet. Changes like that might take some time.

However, if you’re confident of the error and a credit bureau doesn’t agree, that’s not your last stop.

You can also reach out to the CFPB to file an official complaint . The complaint should include all documentation of the dispute. Once the CFPB receives the complaint, you can keep track of its progress on the organization’s website.

The Takeaway

Checking your credit reports can help you ensure that the information being used to calculate your credit scores is accurate and up to date. It can also tip you off to fraud or identity theft

It’s easy and free to gain access to your credit reports from the three major bureaus once a year. Taking advantage of this service (and reporting any errors you may come across) can be key to maintaining good credit, and good overall financial health.

Another way to maintain good financial health is to pay your bills on time (which can boost your credit score), and to keep track of your spending.

Signing up for SoFi Money® Cash Management Account can help with both.

SoFi Money is a mobile-first account that allows you to track your weekly spending right in the dashboard of the SoFi Money app.

You can also set up all of your bill payments directly from the SoFi app or on your computer to help ensure that payments are never missed or late.

Make it easier to manage your finances with a SoFi Money cash management account.

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SoFi Money®
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC . Neither SoFi nor its affiliates is a bank. SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
Third Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third party trademarks referenced herein are property of their respective owners.
External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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As the world becomes increasingly cashless, you may wonder if there is any point to carrying cash around at all.

The answer depends on your lifestyle and spending habits. Carrying–and paying in–cash, however, can still make sense in many circumstances.

Indeed, some financial experts believe that switching to a cash-only system (and moving away from digital payments) can actually be a wise money move for many consumers.

For one reason, going all-in on cash can help you stick to your budget and put an end to overspending.

The cash-only lifestyle can also help you avoid the expense of overdraft, banking, and interest fees that often come with using check, debit and credit card payments.

Of course, there are also some potential downsides to going exclusively cash.

To figure out whether cash living might make sense for you, read on.

Below are some of the key advantages and disadvantages to living on a cash basis, plus tips for how to make the switch, should you decide to give cash living a go.

Pros of Cash-Only Living

Spending money the old-fashioned way can offer some significant perks. Here are some benefits that come with using cash for all your transactions.

Using Cash Only Can Help You Budget–and Save

When spending is invisible, it can be all too easy for people to forget that real money is actually going out the door–and all too easy to get in over their heads.

Using a cash-only payment system, even if it’s just for a month or two, can be a great way to see exactly how much you’re spending each day and week, and help you learn how to live within your monthly budget.

That’s because with cash accounting you only take out the amount you’ve allotted to spend for a certain period of time. When you’re out of bills, you’re done.

And if you use the envelope system (more on that below), you’ll be able to set aside specific amounts for all of your spending categories, such as rent, food, and entertainment.

You can then only use the cash you’ve withdrawn for those expenses, which can keep you from spending outside of those pre-set limits.

Cash-Only Living Can Help You Maintain Privacy and Security

Every debit or credit card transaction leaves a digital paper trail, and enables companies to know exactly what you buy, when you buy, and precisely how much you spend.

A more troubling concern can be the potential for data leaks of your personal and credit card information, which can result in identity theft.

If someone steals your identity, they could potentially empty your accounts and obtain new credit cards and credit lines in your name.

Using a cash-only payment system reduces the odds of a breach.

Cash-Only Living Can Help You Save on Interest and Fees

Credit cards often come with annual, as well as late payment fees.

And some stores and service providers, especially small and local businesses, may charge an extra fee to take a credit card payment, since they have to pay for the transaction.

In addition, if you don’t pay your credit card balance in full, you’re likely to end up paying exponentially more thanks to high interest rates–which often exceed 16 percent.

Cons of Using Only Cash

Using cash-only can also come with risks and disadvantages. Here are some of the drawbacks.

Cash Living Can Come With Costs

Some ATMs charge fees for withdrawing cash, which can be troublesome if you find yourself suddenly out of money and need to use an ATM outside of your own bank.

By using credit cards instead of depending on ATMs, you may be able to avoid those costs.

Cash Living Can Have Security Concerns of Its Own

Keeping cash on your person or in your home comes with vulnerability.

You could be a victim of theft, or the cash stashed in your home could be destroyed in a disaster, such as a flood or fire.

With no record behind it, the money that is stolen or ruined is as good as gone.

A lost or stolen credit card, on the other hand, can be reported and you can often successfully dispute any fraudulent charges.

You Fail to Build Up a Credit History

There’s something ironic about the way lenders look at credit history: If you haven’t borrowed much in the past, lenders may be reluctant to lend to you now.

Opening a credit card account is one way you can build up a credit history (other forms of credit, such as student or car loans, count as well).

A strong credit score is based in part on the average age of your account (the older the better), as well as a history of paying your bills on time, and how much debt you have in relation to the amount of credit available to you.

Your credit score is an important factor if you’d like to take out a loan in the future, such as an auto loan or home mortgage.

If you pay for everything exclusively in cash and never use credit (which is often hard to pull off), you may have trouble showing that you have the credit history to qualify.

Tips for Living a Cash-Only or a Cash-Mostly Life

If you decide to switch to an all, or largely, cash life, here are some strategies to help make the shift as seamless as possible.

Choosing Which Categories to Switch to Cash

Certain payments and bills, such as a mortgage or your student loan, need to be paid digitally or by check.

But you may want to switch groceries, entertainment, clothing and eating out to cash-only to keep better tabs on the outflow.

Cutting Back on Debit/Credit Card and Check Use

For your cash-only categories, it’s a good idea to stop using your debit card, credit card, and even your checkbook to pay for anything in those categories.

You may even want to consider leaving them at home.

Setting up a System for Tracking Cash Flow

To keep cash for different categories separate, you might consider using the “envelope system.”

With this system, you set a certain amount of cash to spend in each budget category. These pools of money are kept separate in different envelopes.

To keep track of the flow, you can put receipts in the same envelopes as you spend.

The goal is to make the cash last all month. Once the envelope is empty, you’ll either be done for the month or will need to take cash out of a different envelope, potentially short-changing another category.

Establishing a Time to Take Out Cash

Whether it’s a certain day each week or month, you’ll want to make sure that you go to the ATM on a regular basis to get the full amount of cash that you’ll need until the next ATM trip.

Planning Shopping Trips in Advance

It’s generally better not to carry a load of cash around, so you may want to know ahead of time what errands you’ll be running, and how much you’ll need for each outing.

(As a bonus, this can also curb unplanned–a.k.a. impulse–purchases.)

The Takeaway

If you’re looking to fix or improve your everyday spending habits, nothing works quite like a cash-only lifestyle.

By forcing you to stick to pre-set spending limits (and actually see where your money is going), this approach may be able to help you keep your monthly spending within your budget.

While cash-only living can take away from efforts to build credit and can have some security issues, this method of spending can also help you save on credit card fees and interest.

If you’d like to pay in cash more often, but still want to earn a competitive return on your money, SoFi Money® might be a good option for you.

SoFi Money is a cash management account that allows you to earn, spend and save–all in one account.

Plus, members can enjoy anytime access to their money at 55,000+ fee-free ATMs worldwide.

Check out all the perks a SoFi Money cash management account has to offer today!

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SoFi Money®
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC . Neither SoFi nor its affiliates is a bank. SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
Third Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third party trademarks referenced herein are property of their respective owners.
External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SOMN19088

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