As the last days of the calendar are nearing, and we are all preparing our resolutions on how to live a better, healthier year next year, do not neglect your financial well-being!
Here are five ways to give your financial goals a year-end boost!
- Review Your Finances – The first step is to do a run-through of your current finances and get an idea of how you’re doing so far. Here are a few essential questions to ask yourself:
- Are you on track to meeting your financial goals by the end of 2020?
- Were there any changes this year in important financial factors such as your income, bills, expenses, insurance, investments, debt and savings?
- What areas need more focus and improvement?
- What will your year-end returns be? Are you satisfied with them?
- Are you prepared for tax season?
- Are you saving enough for retirement?
- Pay Yourself – Many financial experts agree that one of the best tips they can give is to not forget to “pay yourself.” This can mean different things to different people, but, most importantly, it is a reminder to invest in yourself. The most valuable asset a young worker has is the ability to work. When the experts say “invest in yourself,” they mean to educate yourself when possible, keep yourself healthy, get quality health insurance, and consider having the appropriate amount of life insurance for yourself and your family. By investing in yourself early on, you are investing in your financial future.
- Check Your Credit – Mismanaged credit can get anyone into financial trouble, and it is oh so tempting to just whip out those cards especially around the Holidays. Do yourself a favor with a little credit checkup. You can request a free credit report online, Get one and review it carefully. For the most part, check for errors that need to be addressed immediately. A few of the most common mistakes include:
- Incorrect first and last names
- Addresses you never lived at
- Employers you never worked for
- Accounts you don’t recognize
- Accounts listed as open even though you already closed them
- Incorrect balances
Check your credit score, too. Lenders take credit scores seriously when deciding whether someone qualifies for a loan or good interest rate. If you have a low credit score, but plan to take out a mortgage or some other big loan in the near future, figure out what you need to do to improve it before applying.
- Set a Budget for 2020 – Personal financial advisors cannot stress enough the importance of setting a budget. Despite that, many people just do not do so. Setting a budget can help you visualize your financial goals and prioritize how you will spend your money. The discipline of setting a budget and sticking to it can not only get you on track financially for 2020, but also well into the future because it will instill a positive financial behavior into your life.
- Be Charitable – Of course remember, the Holidays are a time for giving, so this is the best time to be magnanimous, but also to plan your charitable giving to have the greatest positive tax implications. Keep your receipts and contribution forms organized in a folder so you’ll have an easier time filing your taxes. If you have kids or grandkids that are college bound, consider funding a 529 plan. In 2019, an individual can gift up to $15,000 under the annual exclusion amount to any individual and the gift will not be treated as a taxable gift.
And finally, even if you think you are on track to meeting or exceeding all of your financial goals, and annually do everything listed above and more – there is always room for improvement!
Surveys have found that more than a quarter of Americans have skewed perceptions of their true financial health. So while you are planning that first doctor’s visit for a baseline physical in January, why not also think about getting a “checkup” for your finances, and seek the opinion of a financial planner.
What do you think of these year-end financial strategies? Are there any that you use we may have left out? Please reply in the comments below.