By Charlestien Harris, Retired Financial Coach at Southern Bancorp
I can hardly believe it, but half the year is almost gone! So many events have impacted everyone’s finances. Think about it: you may have started out in January feeling excited about changes you planned to make to your finances at the beginning of the year. Now that half the year has passed, it’s time to do a quick check on the progress you have – or have not – made.
Procrastination is a common factor that keeps many people from reaching the financial goals they set at the start of the new year. Review the suggestions below to see where you are in your efforts to improve your finances for the rest of the year.
1. Perform a mid-year review of your finances to be sure you’re on track.
Double-check your year-to-date income and expenses against your records to see how closely they align with the budget you created at the beginning of the year.
2. Check to see if you are on track with your retirement contributions and other savings.
When the budget gets tight, we tend to become lax when it comes to saving money. Saving can become stressful if it is not planned and executed in a timely manner. Having an emergency fund and contributing to your retirement account are important priorities, and they should remain high on your financial review list.
3. Check to see if your income tax withholding is accurate.
Be sure you are not paying too much or too little income tax (either through withholding or quarterly payments). Because it is June, you still have time to adjust your withholding status. If you are an employee, visit your human resources department. If you are a business owner, make sure you are withholding enough for self-employment taxes to cover the current tax year. If applicable, second-quarter estimated income tax payments are due by June 15.
4. Start thinking about your holiday budget.
Begin planning early for the holidays. Having a financial plan in place will help you avoid overspending during that time of year. You can plan your purchases in advance and take advantage of early sales and special promotions to save money. Summer sales are a great opportunity to get ahead on gift buying at lower prices.
5. Check to see if you need to make changes to your benefits package.
As open enrollment approaches at work, take time to review your health insurance coverage and other employer benefits. If you have experienced any major life events – such as marriage, death, or the birth of a child – you should make those updates as soon as possible. Keeping your beneficiary information current is essential in case you are unable to manage your own financial affairs.
6. Review your charitable giving records.
Consider making tax-deductible gifts to charity or qualified charitable distributions to reduce your taxable income before the end of the year. This can help maximize your tax benefits and keep you on track with your financial plan.
7. Review all of your insurance policies.
Check your insurance policies (property and casualty, liability, health, disability, and life) to ensure you are not paying too much for the wrong type of coverage. If adjustments are needed, you still have time to make changes before the end of the year or before your policy expires. Keeping your policies up to date helps ensure a smoother claims process.
8. Check your credit report.
You are entitled to a free copy of your credit report every 12 months from each of the three nationwide credit reporting agencies. Additionally, credit bureaus now allow you to check your reports from all three agencies weekly for free. You can request your reports at www.AnnualCreditReport.com.
Performing a mid-year financial review can be beneficial in many ways. The suggestions above are just a few steps you can take to stay on track. If you need additional assistance, consider seeking help from a licensed financial counselor or financial advisor.
For more information on this and other financial topics, you can email me at [email protected] or write to me at P.O. Box 1825, Clarksdale, MS 38614.
Until next week – stay financially fit!
