We’ve all heard how you should do a “spring clean” on your finances each year or prep your budget for the summer. But summer is also a great time to give your finances some attention. In fact, a summer financial reboot can get you back on track so you finish the year strong. Here are the steps you’ll want to take.
Tired of working hard just to watch your money disappear into thin air? If so, try taking a look at your spending over the past few months to see where your money is going. Then start tracking your spending going forward.
For each month you track, create categories that fit your life and tally up all the expenses in those categories for the month. Your categories might include things like housing, insurance, groceries, dining out, entertainment and transportation.
Once you’ve seen your spending in black and white, you have some decisions to make. While there are some areas of your life where you believe splurging is worth it, most of us have something we could cut without sacrificing too much.
Are you spending too much at restaurants? Nights out with friends? Activities for the kids? Only you can decide — and only you can do something about it.
Whether you decide to cut your spending or not, it never hurts to give budgeting a try. While many people think of budgets as restrictive, they don’t have to be that way.
Try to think of your budget as a written plan for the money you earn. You can build splurges or whatever you want into your budget, but it’s there to guide your lifestyle and ensure you aren’t overspending in areas you don’t really care about.
The best part about budgeting is that it doesn’t have to be fancy. Here's a really basic (and easy) budget template to help get you started. Feel free to make adjustments to it as you go so it's customized your needs.
If you have debt in your life — especially high-interest, unsecured debt — your finances will improve significantly as you pay it down or even pay it off.
If you cut your spending, try to divert some of those funds toward paying extra on your debt. Have a bundle of credit card debt? Consider getting a balance transfer credit card, which will let you consolidate debt and ditch interest for a period of time so you can focus on really paying down that principal.
When is the last time you checked up on your life insurance policy? How about your auto insurance or homeowners?
The middle of the year is a great time to shop around for insurance to ensure you’re getting the best deal possible. In fact, life insurance rates keep dropping so now is the perfect time to look.
Also consider the types of insurance you should buy but haven’t yet. If you have kids and you don’t have life insurance, for example, shop around for an affordable term policy that provides the coverage you need. Not sure how much you need? This life insurance calculator can help you get started.
Are you saving enough in your work-sponsored retirement account? If not, it’s never too late to visit your company’s Human Resource department and boost the percentage you invest each month.
Do you have a retirement account? If not, inquire with your HR department about setting one up. If you’re self-employed, you can set up a self-employed retirement account like a SEP IRA or Solo 401(k) on your own.
Also consider the fact that you can still open a Roth IRA or traditional IRA and fund it for 2018. You can meet with a financial advisor to get help setting one up, or you can do it yourself with a brokerage, like Vanguard.
Last but not least, you should always take the time to negotiate your bills at least once per year. Doing so is the best way to ensure your cable bill, phone bill and other household bills aren't getting out of hand.
This part is easy. Just call up the merchant or vendor you pay monthly (think cell phone provider, home phone company, cable company, internet provider, etc.) and ask them if there are any new promotions to be aware of. Tell them you would like to pay less over all and see what they can do.
It’s possible you won’t save a dime, but it’s also possible they could switch you to a new promotion or plan that’s a better deal than what you have now. Either way, the worst thing they can say is “no.”
Feel like putting this all off? Don't do it — these are nine times procrastination can cost you big money.
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