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Be Wise With Money
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12 Months to a More Organized Financial Life
November 4, 2019 | Article adapted from Thrivent magazine
Is getting your financial life in order one of your resolutions for 2020?
It doesn't have to be overwhelming. If you simply take one hour a month – that's 60 minutes out of the 43,200 in a 30-day month – you'll be well on your way to getting your finances in better shape by year's end.
Here's a checklist you can use. The most important to-do? Get started!
JANUARY: Review retirement-savings options.
- If you have multiple retirement accounts (such as 401(k), 403(b), etc.) from previous employers, consider rolling them into an Individual Retirement Account (IRA). This can make retirement savings easier to manage.* Talk with your Thrivent Financial professional to see what works for your goals and specific situation.
- If you're still working, make sure you're taking advantage of any employer retirement plan that's available.
FEBRUARY: Protect the people you love.
- Check the beneficiary information on your insurance contracts, as well as your investment and retirement accounts. And update it if needed. This is especially important if you've had a major change in your life, like marriage, divorce or death. Just call the phone number on your contract to check or make changes.
MARCH: Prepare for a vacation.
- Let your credit card companies that you'll be on vacation, so they don't view out-of-the-ordinary charges as suspicious and put a block on your cards. Not doing this could leave you with declined purchases and feeling frustrated instead of having fun.
APRIL: Make sure your taxes are right.
- Review your tax returns. If you got a refund, use it wisely. Consider putting it into an emergency fund or use it to pay down debt. If you think you need to adjust your W-4 to take out less, work with your tax advisor and then with your human resources department to update the form.
MAY: Keep paperwork safe.
- Confirm your important papers, such as your will, health care directives, passport, life insurance contracts and the like, are in a fireproof box or bank safe-deposit box. Make sure your family knows where to find them if needed.
- Also look for other key documents, like financial statements. Can you find them? If not, think about a new organizing system.
JUNE: Set up automatic bill pay.
- Now that paperwork is in one spot, cut paper bills in half—or more—by signing up for auto-pay. If some don't allow that, create a calendar reminder to pay electronically on the due date. (Bonus: Paying 10 bills electronically a month saves more than $60 annually.)
JULY: Update auto and home insurance.
- Read through contracts to make sure they cover what they should.
- Tell your insurance company about any updates to your home, like a new roof or new wiring, which may lower premiums.
- Save on auto premiums by adjusting your deductible or by dropping collision and comprehensive coverage on older cars. (Just keep liability coverage). Rule of thumb: Drop full coverage if it costs 10% or more of the vehicle's value.
AUGUST: Take stock of big-picture finances.
- Look at how much you have in retirement accounts and college savings.
- Add up how much life insurance you have, along with disability income insurance and long-term care coverage if you're over age 50.
- Make an appointment for next month with your Thrivent Financial professional or target a time to call the Thrivent Financial Guidance Team (TFGT).
SEPTEMBER: Take action on big-picture finances.
- Have the meeting with your financial professional that you set up last month or make the call to the TFGT (888-834-7428) to review financial strategies, share concerns and ask questions.
OCTOBER: Use up your Flexible Spending Account (FSA).
- Submit receipts for reimbursement and plan how to use remaining funds by Dec. 31 or by March 15, 2020 (many plans give additional time to spend FSA money).
- Figure out if you need to change contributions for 2020 during your employer's open- enrollment period.
NOVEMBER: Draft and update your will and other documents.
- If you have a will, power of attorney or health care directive, look to see if they are still what you want. If you don't have those items in place, take time this month to get them started. Ask friends for references to a good estate-planning attorney.
DECEMBER: Make it a month of giving.
- You may give during the year, but if you haven't, finish annual giving before year's end.
- Keep receipts together so you can take the right deductions come tax time.
Check off these to-dos, and you'll have your finances in better shape by year's end.
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*There may be benefits to leaving your account in your employer plan, if allowed. You will continue to benefit from tax deferral, there may be investment options unique to your plan, there is a possibility for loans, and distributions are penalty free if you terminate service at age 55+.
THRIVENT IS THE MARKETING NAME FOR THRIVENT FINANCIAL FOR LUTHERANS. Insurance products issued by Thrivent Financial for Lutherans. Not available in all states. Licensed agent/producer of Thrivent. Thrivent.com/disclosures.