Mid-year is a great time to look over your finances. Staying on track can be tough. Financial professional Brad Allen talks with Milwaukee’s WTMJ-4 on about how to get your finances in order. He has five tips to get you ahead of the financial game before the end of the year!
1. Look at Your Budget – Making a budget isn’t a one-time thing. You need to check in with your budget monthly to make sure you’re not spending more in one area than you should be. Map out necessities over the next six months. Remind yourself that you need to get new school supplies in August, or you need new tires in three months. By getting ahead of the game, you can start saving and adjusting your budget now to be better prepared for those upcoming expenses. And don’t forget to create a holiday shopping budget!
2. Review Your Retirement Accounts – Whether it’s contributing to an employer-sponsored 401(k) or another type of retirement account like an IRA, a good rule of thumb is to be saving 10-15% of your income. If you can’t do that yet, put what you can into a retirement account. A little something is better than nothing. It is also a good time to look at the fees you’re paying.
3. Check Your Emergency Fund – An emergency fund is like a safety net. We recommend our clients have at least 3-6 months’ worth of savings in the bank. A recent survey shows that 69-percent of Americans have less than $1,000 in their savings account and 34-percent of people have no savings account at all. When families don’t have money to face an unexpected expense, like a broken-down car or a medical bill, they may have to borrow to cover the tab – and that can lead to a cycle of debt.
4. Deal with Debt – A survey shows 32% of people with credit card debt only pay the minimum balance due on their debts. Start by looking at your plan from the beginning of year to tackle your debt. There are two popular methods: one focuses on the smallest balance, the other on the highest interest rate.
5. Plan for Taxes – It’s not too early to be thinking about taxes. Now is the time to put yourself in the best position for the end of the year. You may want to increase the amount you put into a tax-deferred account, like a 401(k) or an IRA. This will decrease the income you have to pay taxes on.
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