Spring Into A Better Financial Position
Can you believe it's April already? It feels like we just celebrated the New Year. Even though it may feel like that, time is moving fast it is the 2nd quarter of 2018. So maybe you are on target with your financial New Year resolutions, and maybe you are not. No matter where you are, there are a few things that you want to make sure are completed at this time......
Pay off Holiday Debt Once and for All
Carrying credit card debt or personal loan debt for an extended period of time is not good. Three months have passed since the holiday and the interest continues to build. Having a debt payoff or pay down plan can put you in a much better financial position for the rest of the year. When it comes to your financial health, minimum payments on your credit cards are poison. For example a $2,000 credit balance with a 18% annual rate, with a minimum payment of 2% of the balance, or $10, whichever is greater, would take 370 months or just over 30 years to pay off. You can create a debt repayment plan yourself and begin to pay it off, or work with a financial professional to create a plan, hold you accountable, and create a seamless system to get the debt decreased or paid in full.
Manage your risk
When was the last time you reviewed your life insurance, auto insurance, home insurance, renter's insurance, short and/or long-term disability insurance, income replacement insurance, hospitalization indemnity plans, long term care insurance, and your major medical insurance plans?
This is a good time to give yourself an insurance checkup. Many employers are about to begin their open enrollment period and most Americans depend on their employer benefits tremendously, because they have not purchased various insurance plans outside of their jobs. Once open enrollment begins you can update, add, or delete the programs that you have on your current job based on your lifestyle and need.
For the insurance plans you have outside of your employer, pull copies of your policy documents to ensure you have adequate coverage. For instance, you may need to upgrade your life insurance if you've recently had a birth, death, marriage, separation, divorce, received a raise, changes jobs, started a business by yourself or with a partner, or have a term policy near it's end of the term. As well as you may need to upgrade your homeowner's insurance policy as housing construction costs rise to make sure you can rebuild in case of a total loss.
Organize and/or Shred Old Financial Documents
Sort through your statements, pay stubs, bills and other financial records, and keep only the documents that are absolutely necessary. Since the IRS has up to six years to audit you, keep your tax returns, canceled checks and receipts, and any records supporting your tax deduction for at least six years. If you're unsure about whether you should get rid of certain types of receipts, scan them since the IRS does accept scanned documents or make a copy, then go ahead and shred the rest.
Now that we have shreaded the documents we won't accumulate any unneccessary documents by getting on bill pay.....
Set up Automatic Bill Pay
Spring cleaning isn't only about de-cluttering - it's also about making things more efficient. Set up automatic bill pay, and link it to your primary checking account. Automatic bill pay will eliminate the chances of missing a payment and paying any late fees.
Spring is the time of rebirth. Give birth to your new and bright financial future by doing these things and staying on track with your financial goals.