With winter finally behind us, many are taking part in their annual “spring cleaning” rituals. Maybe you are cleaning out your garage, freshening up your garden, planting new flowers or even holding a yard sale to get rid of unwanted items.
And while you are planning on cleaning out your home or wardrobe, why not take a fresh look at your finances too? In this column I’ll be sharing six tips to help you “freshen up” your financial wellbeing.
- Create or update your budget – There is no way you can take control of your finances if you don’t know what it costs to live each month and what each of your expenses are. Creating a budget can seem like an overwhelming task when you start – but you may be surprised how easy and worthwhile it is.
- What can you cut out? – Now that you have created your budget, review each expense to see if there is something you really don’t need. Are there services that you pay for that you don’t use? Could you cut back on your TV subscription or your cell phone package?
- Take control of your debt – The only way to tackle debt is to create and honest and accurate accounting of how much you owe and to who? Make a list of your outstanding balances, the interest rates and lenders and confirm that you have the minimum payment listed for each. Now you can figure if you have the ability to pay extra. Start by making the minimum payment on each debt and any extra put towards the debt with the highest interest rate.
- Review your credit report – On an annual basis you should request your free copy of your credit report form Equifax or TransUnion and review each item and account on it. Many people are surprised to find an account or item that is incorrect – perhaps an account that is closed and still showing open. You don’t want to wait until you’re applying for a mortgage or car loan to discover this error!
- Set your savings to autopilot – Consider automating your savings. Set up your monthly, biweekly or weekly contributions to come out of your bank account automatically. It’s an easy way to ensure your never miss a contribution.
- Make sure you’re protected – An important piece of your financial security is holding adequate insurance. If you have a spouse and children, life insurance may not be enough. If your family relies on you being healthy and able to work, disability and critical illness polices should also be considered.
Spring is a perfect time to sit down with your Certified Financial Planner to review your plan. Make any adjustments that are required and ensure that all your bases are covered.
This column is written by Michelle Weisheit CFP, IG Wealth Management and presents general information only and is not a solicitation to buy or sell any investments. Please contact your own advisor for specific advice about your situation.