April 2010 Newsletter

Tip of the Month: Lessons learned while preparing my tax returns

Confession: I finished my tax returns and mailed them off on April 14. This is better than last year, when I sent them off on April 15 — but still, not how I really want to handle my taxes. Here are the organizing-related lessons I learned — or had reinforced — these past couple weeks.

1. It’s amazing what you can do when you focus. For a few days, almost all my spare time went to tax-related tasks; I spent much less time than usual on other activities. (And I delayed writing this newsetter!) While I wouldn’t want to be quite so single-minded every day, I have a new appreciation of the power of focusing on your top priority.

2. On the other hand, procrastination sucks. Through the Institute on Challenging Disorganization, I’ve recently become acquainted with Dr. Timothy Pychyl and his work on this subject. Dr. Phychyl defines procrastination as “a voluntary, needless delay of an intended action that risks undermining our performance and well-being.” He points out that procrastination is just one type of delay, and while some delay may be useful, “procrastination has no benefits.”

I procrastinated in keeping my QuickBooks up to date, and he’s right; all that did was increase my stress.

3. The intimidating tasks we procrasinate about are often not so bad. Many of the items I hadn’t entered into QuickBooks were ones where I had some questions about how to handle the transaction, for a variety of reasons. But when I did the research, I found my answers quickly.

4. Doing related tasks in batches is good — within reason. It might well make sense to update the books once a week, or maybe even once a month. But doing one big batch of assorted transactions from the past 12 months all at once, a week before your tax return is due, is not a good strategy.

5. Breaking a big task into smaller manageable tasks is extremely effective. I know this from my project management days, and it still holds true. I divided my tax-related tasks into six major categories, and did them one at a time. I knew approximately how much time each one would take, from past experience, so I could make sure I kept on schedule. And getting each one done gave me a feeling of accomplishment.

6. Having a reliable filing system is crucial. This is one of the things I did well! I have one place where I put all papers related to business expenses that have NOT been scanned and entered into QuickBooks; once they are entered, they get filed somewhere else. All my other tax-related papers — and my tax-related electronic files — also have a defined home. This meant that nothing got misplaced.

Second Tip of the Month: The importance of having a will

A recent survey indicates that only 35% of adult Americans have a will, and only 18% have a trust. Only 29% have powers of attorney for finance or health care.

Here’s yet one more story of what can happen when you don’t have a will, involving the author of The Girl with the Dragon Tattoo and the two sequels to that book.

“Stieg Larsson spent 32 years of his life with the architect Eva Gabrielsson. However, they never married, maybe due to Stieg’s dangerous work at the Expo-foundation. They did not have any children, and Stieg left no written will, so according to Swedish law, Stieg’s estate was inherited by his father and brother.”

It seems likely that’s not what Larsson would have wanted. Please, if you don’t have your estate planning documents in place, do that as soon as you can.