We know that as you enjoy the summer months, the last thing you want to do is think about your finances. However, this is the perfect time to check in with your financial self and make sure you’re hitting the goals you established at the beginning of the year.
Here are 10 things you can do now that your future self (the one who has to look at financial stuff during the holidays) will thank you for:
1. Review Your Budget/Cash Flow
Take a close look at your money flowing in and money flowing out. Compare your actual spending to your planned budget and identify any variances. Are you spending more than you planned in certain categories? Adjust your cash flow to reflect any changes in your financial situation.
2. Evaluate Your Savings Goals
Check on the progress of your savings goals. Whether you are saving for an emergency fund, a vacation, or retirement, ensure you are on track. If you’ve fallen behind, consider ways to cut expenses or increase your savings rate. Think about your long-term goals and evaluate whether some of your current expenses are necessary.
3. Update Your Financial Goals
Your financial goals may have changed since the beginning of the year; take some time to reassess and adjust as necessary. This might include setting new short-term goals or modifying long-term objectives based on recent changes in your life or financial situation. Bottom line: How bad do you want it? Think about your goals, evaluate what matters to you, and prioritize.
4. Check Your Credit Report
Order a free copy of your credit report from one of the major credit bureaus and review it for accuracy. Look for any errors or suspicious activity that could indicate identity theft. Correct any mistakes by disputing them with the credit bureau.
5. Pay Down Debt
Evaluate your progress in paying down debt. Consider implementing strategies to accelerate debt repayment, such as the snowball or avalanche method. If you’ve paid off a debt, allocate the freed-up funds towards other financial goals.
6. Reassess Insurance Coverage
Many insurance companies have raised rates! If your auto and homeowners has not increased, it probably will very soon! Invest some time in reviewing your policies and assure you are covered properly for you and your family. There may be discounts you can qualify for. Also, there may be details on your policies which don’t apply to you any longer. Take the time to review this soon.
Review your insurance policies to ensure you have adequate coverage. This includes health, auto, home, and life insurance. Adjust your coverage if your circumstances have changed, such as getting married, having a child, or buying a new home.
7. Evaluate Investments
Look at the performance of your investment portfolio. Ensure your asset allocation aligns with your risk tolerance and financial goals. Consider rebalancing your portfolio if certain investments have significantly outperformed or underperformed.
8. Plan for Taxes
Take a mid-year look at your taxes. Consider any life changes that could affect your tax situation, such as a new job, a raise, or major purchases. Adjust your withholding if necessary and explore tax-saving strategies that can be implemented before the year ends. Check-in with your CPA for a tax-planning meeting. Planning ahead for taxes can help you greatly. Take the time!
9. Review Subscriptions and Memberships
Go through your bank and credit card statements to identify any recurring subscriptions or memberships. Cancel any services you no longer use or need. This can free up money that can be redirected toward your financial goals.
10. Set Up Financial Safety Nets
Ensure you have the right safety nets in place. This includes having an emergency fund with at least three to six months of living expenses, as well as making sure you have updated wills, power of attorney, and other critical estate planning documents.
Don’t feel like you must take all of this on by yourself! Part of our job as financial planners is to help keep you accountable and answer your questions about your portfolio. Never hesitate to reach out even with small questions.