Spring is a great time to check in on any financial goals you set for 2016 and fine tune your efforts. Whether you’ve gotten off track with budgeting or are just ready for a refresh, here are six ways you can spring clean your financial goals and set yourself up for success for the rest of the year!
1. Check in on debt.
If one of your objectives this year was to pay down debt, check in on how that process is going—think about what is working well or could be improved. If you haven’t done as well as you’d planned, try not to focus on the lack of progress and simply reset your goal, starting now. Most importantly, take a look at what got in your way. Did you overshoot what you’d be able to tackle this year? Did an unexpected expense sneak up on you? Identifying why you fell off track on debt reduction can also point to other areas that you want to refresh in your financial picture.
If you’re looking for a place to start to tackle debt you might consider taking on a card or account with the lowest balance, similar to the “snowball” method. Yet you might be tempted to pick a balance with the highest rate, and there are plenty of good reasons for doing so. But you will gain momentum and traction by feeling like you can complete your debt pay goal before year’s end, so keep that in mind.
2. Revamp your budget.
Take a look at how your spending habits are progressing. Are your expenses lining up as expected or did you have an unplanned change in income? If you’ve gotten a bit off track with budgeting, you may consider trying a different budget methodology.
If you were lucky enough to get an unexpected raise this year (nice work, girl!) ensure you’re putting that money to use wisely. See if you can painlessly bump up your retirement contribution by a percentage or two, or increase automatic payments toward paying down debt. Shortly after an annual increase can be one of the best times to revamp your budget because that money can be redistributed toward your financial goals—without you even missing it!
3. Prioritize savings.
Likewise, savings plans go hand in hand with making sure your budget is on track. If you haven’t established an emergency fund with a few months of living expenses, that’s something to move to the front of the priority list. Now is also a great time to start thinking about setting up a spending plan for the holidays or any special events happening toward the end of the year. Sketching out a budget now for big purchases (like holiday gifts) is a great thing to do well in advance—you’re less likely to make impulse purchases and be more realistic with spending when removed from the holiday hustle and bustle!
4. Review financial documents.
Now that you’ve filed your taxes and we’re well into 2016, be sure you’re only hanging onto the financial records you need. Digital or otherwise, it’s a good idea to keep tax documents for seven years. It’s also valuable to do a quick clean up of any electronic statements. If you keep them in email or on a hard drive, take a few minutes to separate them into folders or delete copies you no longer need. If you still have stacks of paper documents, digitize them and place into the electronic financial folders you created. Clear out the clutter of unnecessary financial documents!
Also, check in on your credit statements. Reviewing them thoroughly is a good idea (at least once per year) so you understand your credit score and overall debt. It’s also important to review your credit report to be sure there are no errors—it can be one of the first indicators that you may have been victim of identity theft.
5. Brush up on your money know how.
If one of your 2016 goals was to become more financially savvy, consider recommitting to a weekly financial podcast or reading strategy to up your game in the personal finance department. If you’re feeling really committed, consider swapping out a next Netflix marathon with a free online course (like Khan Academy or Coursera) that makes financial and economic concepts easy to understand. Lastly, consider poking around your favorite news sources or the Wall Street Journal and Financial Times. It’s also fairly easy find a few finance experts to follow on social media for a daily dose of new financial ideas.
6. Tweak your taxes.
While getting a big tax return can feel like a fun surprise “bonus,” it actually means you gave Uncle Sam an interest free loan last year! Instead of waiting until next year to get that money back, take a few minutes to tweak your deductions and withholdings to ensure you’re coming out at the end of the year as balanced as possible. Always be sure you’re including a tax professional in these conversations to understand how to make tax time easier, as everyone’s personal tax situations vary.
If you’re a gal who is set on staying in “refund” territory, consider having a detailed action plan for that money as soon as you get it back—whether it’s applying the funds directly to student loan debt or immediately putting it into emergency savings. Having a goal in mind now will help you avoid fettering it away on smaller purchases or impulse buys down the line.
Do you tidy up your money habits this time of year? What finance spring cleaning tips did we miss?
This article was originally published April 13, 2016.