Resolve to tackle finances in 2012
Did you resolve to tackle your finances in 2012? If so, adding financial tasks to your to-do calendar could be helpful.
“Even when I know that something is important to do, it’s easy for me to let it slip by. However, a to-do calendar helps me get tasks accomplished,” said Kathy Sweedler, University of Illinois Extension consumer economics educator.
Research shows that we tend to put only a few hours a year into planning our finances.
Mark out time once a month to tackle your finances. Think about how good you’ll feel in January 2013 when you review your resolutions and can say, “My financial life is in better shape.”
Consider adding these 12 financial tasks to your calendar; many can be done in less than an hour. You can download free work sheets by clicking on financial tools and find links to websites to help you with these tasks at web.extension.illinois.edu/cfiv/ce.html.
Ÿ Write your financial goals. Where do you want to be in a year, five years and 20 years? How can your money help you get there? It’s much easier to manage our day-to-day spending when we are motivated to work toward long-term goals.
Ÿ Save money. Everyone needs savings to deal with unexpected expenses and the bumps in life. If you already have a savings account, consider increasing the amount you save for retirement.
Ÿ Talk with family members about money. Do you have family members who need to plan for long-term needs? The website, “Long-Term Care: Talking, Deciding, Taking Action” at longtermcare.illinois.edu has suggestions on how to start this conversation.
Ÿ Decide whether you are comfortable with the amount of debt you have. If you’re worrying about the amount of debt, that’s one signal that you may owe too much. Comparing your total monthly debt payments to your monthly take-home pay is another way to evaluate your debt load. “Decide How Much Credit is Too Much,” posted at the above website can help you evaluate your debt load.
Ÿ Do an energy audit for your home. An energy audit can pinpoint home energy efficiency improvements that pay back year after year. Contact your local utility company for assistance. Sometimes local funds can help pay for the audit.
Ÿ Rebalance your investments. We need an appropriate mix of types of investments to meet our needs. Does your mix still match your desired portfolio in terms of liquidity, growth and income? If not, you may need to take steps to rebalance these investments. You may find the “Asset Allocation Analyzer” worksheet helpful for this task.
Ÿ Calculate your net worth for a snapshot picture of finances. Add up the market value of all your assets (what you own) and subtract your liabilities (what you owe others); this is your net worth. Do this the same time each year to measure your progress toward saving for retirement.
Ÿ Update the security of your smartphone and/or computer. Many of us conduct financial transactions with our smart phones or computers. Smartphone browsers and financial institutions provide security to minimize the potential of computer hackers accessing your account. However, make sure that your phone or your banking app is password protected. That way if you lose your phone, someone else can’t access your account. For further security measures, your individual banks and/or cellphone carriers should be consulted.
Ÿ Review your insurance plans to see if any adjustments in coverage levels should be made or whether who is covered needs to be updated.
Ÿ Check your credit report for accuracy. One of the best ways to catch identity theft is to check your credit report. You can check your report from the three main credit bureaus for free, once a year, at annualcreditreport.com.
Ÿ Update financial documents such as wills, power of attorney, and health directives to meet your current needs.
Ÿ Increase your financial knowledge. Explore new ways to learn about finances through blogs, Twitter (follow Kathy Sweedler, extension educator, @morethancoupons), and other news sources.