How to Overcome Common Financial Pitfalls When You Have ADHD

But there are simple ways you can surmount these potential pitfalls. Here, Sarkis and Sandy Maynard, MS, an ADHD coach who operates Catalytic Coaching, share their advice for financial success.

Ditching Disorganization & Paying the Bills — on Time

“One way to keep financial records organized is to know when to keep (and when to shred) them,” Sarkis said. Reduce your paper piles and you’ll “reduce your stress.”

To figure out what stays and what goes, ask a financial professional. You may need to keep some documents anywhere from several years to even a lifetime, while others you can shred right away. (Use a crosscut shredder to reduce your risk of identity theft, Sarkis said.)

Another great way to cut down on paper clutter and actually find what you need is having online statements, Maynard said. (Have a safe place for keeping passwords.) Plus, you can set up automatic payments for most bills. If you still receive paper bills, create labels for your folders by cutting out the company’s logo like this, Maynard said.

Also, consider if you can find the printed information elsewhere, such as a website or library. When Maynard helps clients organize their offices, she often observes that they have copies of everything, even though there’s a resource center that has these materials.

Maynard also suggests her clients perform a spring and fall cleaning of their paperwork (computer files and closets, too).

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Getting a Handle on Impulsive Spending

Since impulsivity is a symptom of ADHD, it’s not surprising that it extends to spending. But halting hasty spending cold turkey doesn’t work. According to Sarkis, it can actually backfire. “If you are severely restricting yourself from spending, you may find that one day you just can’t take it anymore and you go on an impulse buy-a-thon.”

The key, Sarkis said, is to “curb your spending” and practice what she calls “rational spending.” “Take things one step at a time. Little things like checking your shopping cart and removing impulse purchases before you go through the checkout line can add up to some big savings.”

Importantly, identify where your impulsive spending tends to happen, Maynard said. For one of Maynard’s clients, Brooks Brothers became a money pit. His closet and another room were already stuffed with clothes but he couldn’t resist buying something on sale. What helped him was talking to Maynard on the phone whenever he’d pass the store. He’d tell her everything he would’ve purchased if they weren’t talking and she’d ask questions like “Do you need it just because it’s a bargain?” After he’d leave the store empty-handed, they’d discuss how much money he saved. (Often it was upwards of several hundred dollars!)

“If you feel safe doing it, walk into a store and add up what you would’ve spent money on,” Maynard said. If you see something you want to buy, leave and “tell yourself, ‘I’ll sleep on the decision.’” Also helpful is to observe “how you’re rationalizing your purchases and have a mantra to tell yourself differently,” she said.

Is the grocery store your money pit? Make a shopping list, and stick to it, Maynard said. Try an online delivery service, which reduces the temptation to walk down the aisles and get items off your list. The smell of fresh baked bread and the look of a nice piece of meat may tempt you right out of your money. Keep it simple, too, by shopping at a supermarket “that meets most of your needs,” she said. And avoid shopping when you’re hungry.

Want to make a big purchase? First talk it over with your family or someone else you trust, Maynard said.

Creating a Simple Budget

The symptoms of ADHD don’t lend themselves easily to budget-creating either. But you don’t need to keep intricate records or make complex calculations. Think of your budget “as just a way of finding out where your money is going,” Sarkis said.

In fact, people with ADHD often don’t know where their money goes, Maynard said. As a solution, she suggested picking a time every day to sit down and record that day’s purchases. Some of Maynard’s clients are surprised to find they’re spending a lot of money on little things, such Starbucks or iTunes.

When creating a budget, first figure out your “needs” — think shelter and food — and your “wants” — cable — Sarkis said. List your fixed expenses, “the things you must pay every month – items that are not negotiable,” such as rent or a mortgage. Then list flexible expenses, or the “things that you are able to change the amount of money you spend on them.” In other words, if you’re spending $200 on going out every month, take a look at how you can shrink that number, she said.

No worries about being nitty-gritty with your numbers. “We are just looking for estimates – no need to get into detailed dollars and cents,” she said.

Practicing Long-Term Planning

Not planning for the long haul “can lead to a lack of retirement savings,” Sarkis said. She recommended taking “advantage of an employer’s retirement savings program. Have money directly transferred from your paycheck to your retirement account so you aren’t tempted to spend that money instead.”

Also, consult a financial planner, especially if you’re self-employed. They can help you figure out “what percentage you should be putting away according to what you make,” Maynard said. Then once you know that percentage, have it automatically deducted, as well.

Tackling Taxes

Tax time is when you need to be organized, on time and meticulous, and ADHD symptoms can make the process tough. Fortunately, tax season has passed, but it’s still best to keep organized year-round, so you aren’t freaking out come April. Learn to simplify your tax prep here and here.