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Monday, Dec. 2, 2019

Time to Take Inventory, Plan


Start reviewing your financial goals

The new year will be here before you know it. How well did you manage your money in 2019, and how can you do even better in 2020? If you haven’t done so already, it’s time to review your financial goals. In fact, having a plan in place before being completely swept up in the holiday shopping frenzy can help ensure that 2020 starts strong.

To know where you are going, it is helpful to know where you have been. Start by assessing where you are now and how you got there. Before diving into 2020’s plans, take time to review your finances for 2019. Did you meet your savings goals? What about retirement? Did anything change in your life this year that you need to plan for in next year’s budget? Now also is a good time to pull together all those receipts you will need come tax time. With a clear and honest picture of this year in front of you, it’s time to tackle next year’s budget.

Remember, a budget is a plan – it’s your plan for your money. And like most plans, your budget will change over time. Now is a great time to review your spending. Remember that gym membership? Well, if the only thing getting lighter is your wallet, then it’s time to cut it loose. Do you have streaming services or other subscriptions you no longer use? If not, then don’t pay for them anymore.

But don’t just think about the things you can cut. Did you adopt a puppy on impulse this year? Build in the expenses for vet visits, food, treats and more into next year’s budget. Planning a dream vacation? Start stashing cash now and avoid a credit card hangover when that vacation’s over. And don’t forget about possible changes to insurance premiums, the mortgage payment and other monthly bills.

We might be on the downhill side of the holiday season, but plenty of seasons lie ahead of us, like Mardi Gras season, baseball season and, most importantly, tax season.

It’s not too soon to be thinking about your taxes. Not only will it get you better organized for when you do sit down with your accountant, but you can get an early snapshot of where you might stand. Are those tax deductions not quite at the level you want them to be? This is a great time of year to make some charitable donations that can make a big impact.

While you have your accountant or financial planner’s attention, now is a good time to review your retirement accounts and other investments. If the workload has you thinking about an early retirement, go ahead and find out now what you need to do to make that happen. If you’re thinking about changing jobs, or maybe starting your own company, make sure you consider the impact that will have on your retirement and other savings.

Don’t forget your credit score, either. If you are planning to buy a car, a house or any other big-ticket item, you will want to know that the information in your credit reports is accurate. At the least, bad information in your credit report can make a difference in the interest you pay on that loan. Even worse, bad information could keep you from being approved.

Don’t stop at just knowing your credit score, either. Dive deeper to ensure the story behind the score is right. Are there accounts listed in your credit report you don’t remember applying for? Are there addresses, phone numbers, email addresses or jobs listed that you never had? Those could be signs that you’ve been a victim of identity theft. That’s a whole different mountain to climb.

If you have made your financial list, and checked it twice, and you discover you’re right on track, then celebrate that success. But remember, there is always room to improve on your financial habits and your dreams. Maybe it’s time to consider stretching your goals – like building your dream home instead of buying an existing one, or vacationing in Paris, France, instead of Paris, Texas.

If you review your finances and feel like you are falling short, don’t beat yourself up. Successful budgeting is like successful exercise – it takes discipline, effort and time. But it all starts with a plan. So set your goals, dream big and make a plan today. And remember, your budget doesn’t come out of a Ronco rotisserie. You can’t just set it and forget it.


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