Is It Time for Your Financial Check Up?

August 12, 2021

You routinely take care of your health and fitness, now it’s time to put a similar plan in place for your finances so that you know what you are working towards and how it is going. A financial checkup may seem like something that can wait, but frequently keeping tabs on it can set the financial tone for your life and ensure you are on track to reach your goals.

If you have finally caught up on all those delayed healthcare appointments this past year, it is time for your financial checkup. And we have made it easy! Here is your checkup plan in 3 steps to see how financially fit you are and where improvements can be made.

1- Set Goals

Everyone should have 2 sets of goals, short and long-term. Each will have a different impact on your life, such as paying off debt, saving for a home, or retirement. Start by identifying the goals you’d like to achieve then create a plan that leads you to money for both your future needs and wants. Setting the goal is the first step but establishing the steps to achieve them is just as crucial. Most of you may have heard of setting SMART goals in other parts of your life -Specific, Measurable, Achievable, Realistic, and Time. SMART goals are a great way to set your financial plans too. Be sure to reassess and adjust your goals along the way at each financial checkup.

2- Review Your Budget

To determine how you’re going to fund these goals and investment opportunities, it is important to start by reviewing your budget. Being aware of your spending habits and taking the time to review them annually will help you improve future financial decisions. Identify areas where you can cut expenses and consider allocating those funds towards savings goals. Being intentional, going through the steps of reviewing, and maintaining your budget could make all the difference in keeping you on track.

3- Start Investing

The sooner you start investing in your future, the more time there is for your funds to grow for you. If you are just starting out and don’t necessarily have much extra to invest, try putting aside a little from each paycheck into a savings and/or a retirement account. These small deposits won’t even be noticed from your paycheck after some time and will grow without you doing anything. The funds that are currently being saved will turn into a nice emergency fund should you need it. When you receive a pay increase, a good rule of thumb is to immediately increase how much you are putting into savings before you start spending more. Avoiding expense creep is one of the best ways to set yourself up to achieve those longer-term goals.

Keep your big picture needs and wants in mind when saving so you remember you are working towards something much larger in the end. It might help you continue to increase those deposits whenever financially possible.

No matter what financial goals you may have, it’s important to take control of your finances to make purposeful decisions each day for your future. An annual financial checkup keeps you on track and reminds you to evaluate your current spending decisions in light of your longer-term goals. If you haven’t had your check-up recently, now is the time to re-evaluate your circumstances, create a plan, and put that plan into practice to ensure you’re financially fit.

Susie McLane, Vice President
Wealth Advisor