The 12-Step Financial Check-up

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Living the lifestyle you want requires regular money checkups and occasional strategy sessions with a financial adviser. A new calendar year is the perfect opportunity to review your financial big-picture and make adjustments that will set you up for success in the future. Here are 12 ways to get started:

GET ORGANIZED

Can you easily pull out of your files any financial document you need? If not, it’s time to gather and organize all your important financial documents and records. This may include papers associated with your income and expenses, wills, insurance policies and power of attorney.

REVISIT YOUR FINANCIAL GOALS

Did you make progress on your financial goals in 2017? Do you have a major purchase on the horizon, like a car or kitchen renovation or second home? Identify your goals and use them to steer your financial decisions.

EVALUATE CHANGES IN YOUR SITUATION

Major life changes, like buying a house, getting a divorce or gaining a grandchild, can impact your finances. Since your last financial checkup, have there been any changes in your personal situation? Do you anticipate any changes in the near future? Take these into consideration and make adjustments accordingly. 

TRACK YOUR REAL SPENDING

Many people guess how much they spend, but they don’t always guess right. Tracking everyday purchases like gas, Starbuck’s and groceries, as well as bills and other regular expenses, illuminates a more accurate big picture. You can then use this information to make decisions about budgeting, saving, spending, and meeting your financial goals.

EVALUATE YOUR INVESTMENT PERFORMANCE

Talk to your financial adviser about whether your stocks, bonds, or mutual funds are performing compared to the rest of the market. And look for ways to improve your portfolio’s performance.

CHECK YOUR CREDIT REPORT

Review your credit report regularly to check for inaccuracies — these may indicate identity errors or fraudulent activity. The Fair and Accurate Credit Transactions Act gives you the right to receive a free credit report every year from Experian, Transunion and Equifax.

PROTECT YOUR ASSETS

Review your homeowner’s, health, auto, life, and disability insurance policies. Do you have adequate coverage? Are any policies about to lapse? Taking action on any issues now will keep your assets protected.

EVALUATE YOUR DEBTS

Compare the interest rate on your mortgage to the current market. Should you consider refinancing? And how successfully are you controlling and paying down debt? Managing your debts will help you pay them off as fast as possible.

PROTECT YOUR IDENTITY

Spam e-mails, old financial documents, bank hacks, and even skimmers on card processors can give criminals access to your personal information. Check your credit report regularly and be aware of current scams and security breaches and how they happen. Shred old documents before your throw them away and consider signing up for a credit monitoring service.

LOOK FOR WAYS TO REDUCE YOUR INCOME TAXES

While conducting your financial checkup, start planning for next year’s taxes by looking for deductions. Review the list of available deductions and figure out what you need to take advantage of them.

PREPARE FOR THE UNEXPECTED

Review your will and estate plan. Have changes in your life warranted any updates?

REVIEW YOUR RETIREMENT PLANS

If retirement is on your horizon, look at your funds. Can you contribute more to your retirement plans? Where do you need to make changes so you reach your goals when you’re ready to stop working?

When you use these tips and conduct a full financial check-up, you can ensure 2018 is your best money year yet.