Day 26 of the January Money Diet – Give Your Finances a Tune-Up

Grow your finances | Happy Simple Living blog

This final week of the January Money Diet is the perfect time to review some important details related to our finances. These are some suggestions:

Lock Everything Down

Literally and figuratively, do all you can to protect yourself from theft and fraud. Do you have super-duper tough, unique passwords for each and every one of your financial accounts? A password program can help you choose and store complex passwords; I use the free version of LastPass.

In the physical realm, if you keep important documents in a file cabinet, is it locked? Do you have copies of your important papers and financial account numbers scanned and securely stored?

Review Your Credit Report

Check your credit report and make sure there are no errors. The Fair Credit Reporting Act requires each of the nationwide credit reporting companies — Equifax, Experian, and TransUnion — to provide you with a free copy of your credit report, at your request, once every 12 months. You can order one at annualcreditreport.com.

Set Up an Automatic Savings Plan

If you do nothing else this year, try to set an automatic savings plan. This is the easiest, most painless way to grow wealth and I promise you’ll be glad you did it. If you can start now and gradually increase the amount as your income increases, you’ll be amazed at how much you can save.

If you missed yesterday’s post, it makes a case for setting up an “inconvenient” savings account; you can read it here.

Rebalance the Investment Mix in Your Retirement Accounts

Most financial experts suggest checking your targets at the beginning of every year, and rebalancing your investments when your balances veer more than five percentage points from the targets.

Consider Hiring a Financial Advisor

Do you feel confident in your own abilities to manage your money, or could you benefit from professional advice? I recommend working with a fee-only advisor who doesn’t get compensated for investing your money. You can find one through the National Association of Personal Financial Advisors.

If you have an advisor, do you feel confident that this person is carefully monitoring your investments and has your best interests at heart? If not, it’s time to have a conversation about your goals and expectations. Or perhaps it’s time to make a change and find just the right person to help you achieve your objectives.

Make Sure You’re Adequately Insured

When our roof was damaged in a hail storm, I discovered my policy covered the actual value of the roof, not the replacement value. The result was that I had to pay nearly $4000 out of pocket toward the roof.

Review your policies with your insurance agent and make sure that you understand exactly what is covered and what isn’t. You don’t want to pay for coverage you don’t need, but you also don’t want to be under-insured.

Another lesson I learned the hard way:  if you have a 16-year-old driver hitting the roads this year, purchase an auto insurance policy with the lowest deductible amount you can get. Higher deductibles make sense for more mature drivers with a history of safety. Trust me on this.

Review Your End-of-Life Plans

Have you created a will? If not, put this on your 2016 ‘To Do’ list.

If so, review your will and make sure it still reflects your wishes. Have you designated the right people to be executor of your will and to hold power of attorney, in case you become incapacitated? Also, review the beneficiaries of your retirement plans and life insurance policies to make sure this information is up-to-date.

How About You?

Are there things on this list you can tackle this week? If you have other financial tasks to add to this list, we’d love to hear your thoughts on the Comments section of this page.

The January Money Diet will officially end on Sunday, and I can’t believe how quickly the month has passed. Are you ready to end the diet, or do you plan to continue following some of the ideas we’ve tried this month?

Hugs and happy Tuesday,

The signature for Eliza Cross

About Eliza Cross

Eliza Cross is a full-time writer and the author of a dozen books about food and home design. She has been blogging about simplicity and sustainable living since 2006.

3 comments to Day 26 of the January Money Diet – Give Your Finances a Tune-Up

  • Kimberly

    I got my free credit sheet but they don’t give you your number unless you pay now

  • Colette

    I, for one, plan to continue the money diet as I phase into early retirement. I am doing well selling off my lifelong hoard of vintage and other items, and have much to move along…over $200 earned this month alone on Facebook groups. As the year marches on, I will consider every purchase, and vow to get rid of an item for every yard sale treasure that I acquire this season. I have heard of credit scores in the States, but I don’t think that we have them in Canada. Our socialized medicine is a real blessing. We don’t ave to worry about being sick, getting cancer, etc., and I certainly don’t take it for granted!

  • Lynn Louise

    I get my credit score free through my credit card company. I love my credit card and use it for all my purchases. Due to the recent economy “drop”, I called and changed some of my investments. I need to keep an eye on these better and take more of an interest in them. It is my money after all. I should know where it is and what it’s doing.

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