2016 is here and we want to help you make it one of your most financially successful years to date. Here are a few simple tasks you can complete while your resolutions are fresh in your mind:
1. Get acquainted with your finances
If you haven’t checked in with your budget, investments, insurance, or retirement strategies in a while, sit down now and get to know your accounts, bills, and spending patterns. Don’t try to make changes yet, just gather all the documents, bills, statements, and online access details you need and go over your finances with your spouse or partner. Here are a few tasks to complete:
- Make a list of all your bank accounts, investment accounts, credit cards, insurance policies, retirement accounts, etc. Keep this in a safe place for future reference.
- Check your account statements for errors.
- Check the beneficiaries on your insurance policies, investment accounts, and retirement accounts and update any other details as necessary.
- Get a handle on how much money you spend each month by totaling up bills and statements.
2. Automate as much as possible
Take the hassle out of your finances by automating as many tasks as possible. One of the most common mistakes people make with their finances is forgetting due dates or forgetting to change default settings (such as with retirement contributions). Check the retirement deferral amounts on your paychecks and consider ramping them up this year.
Automate important bills like insurance premiums, credit card payments, and rent or mortgage checks through your bank or credit union to make sure that you never again miss a payment. Though you’ll need to stay on top of your statements to make sure you’re not being overcharged, you have a bit more leeway to do this when you’re not under a payment deadline.
If you have trouble meeting your savings goals, set up an automatic transfer to move money into your savings and investment accounts. By treating your monthly savings just like a bill, you’re more likely to meet your goals this year.
3. Build your emergency savings
If you don’t currently have 3-6 months of expenses set aside for emergencies, now is the time to start building those savings. Having an easily available source of cash for financial emergencies like home repairs, medical bills, job loss, and other unexpected events can make the difference between weathering the storm and derailing your financial life. If you do have some emergency cash set aside, review the balance against your current spending and needs to determine whether you need to add some more this year.
If you have any questions about how to improve your finances this year, please give us a call or schedule an appointment today! We look forward to serving you in 2016.