5

In order to maintain the health of your finances, do you do any particular activity on an annual basis that you would recommend that might benefit others? Say, a "spring cleaning" of some sort?

7

Not to be a downer...but:

Another thing to consider is an update to your "accounts document". By that I mean, your list of banks, account numbers, insurance policies, access information, etc. I'm told that keeping this information up to date and attached to your will can make a lot of things go far smoother in the event of an untimely passing.

I should probably get on that myself...

4

You should pull your credit report from all the credit reporting agencies annually to make sure only the accounts you know of are being reported.

4

You should also update your Net Worth Statement as well as an inventory of all your assets. Unfortunately these are extremely time consuming, but in the event that you pass away your loved ones will know all of your finances and it will be easier for them in a very difficult time.

The Net Worth Statement compiles just that, your net worth. The net worth is compiled by subtracting your liabilities from you assets. Assets include things such as cash, money in accounts, all estimated value of your household items, any life insurance, bonds, mutual bonds, and retirement money. The liabilities include amounts such as your mortgage, second mortgage, car loans, unsecured loans, credit cards, student loans, and life insurance loans. This statement is a great way to track year to year how you are doing on your finances and if you are where you need to be in order to retire when you would like.

The Inventory is also very important. This is used in the event that you have a fire or some sort of disaster that requires you to give a statement of any items you had in your home. This is a very difficult thing to go through, and having this statement ready to hand over only makes thing easier. There are a couple ways to do this. Some people take pictures of everything they have in their house and make notes of prices and values, some people take a video of the whole house, and some people write down item by item on the computer or on a piece of paper. Whatever way you would like to do it is fine, what works for one person does not necessarily work for the other.

3

Plenty! Following are just a few:

For things like RESP and RRSP which have an "end" date; as you or your children age, you should be migrating to less speculative investments and more secure ones. When children are young, for example, you might be in a "growth" type fund. Later on, you would likely want to switch that to an "income" fund, which is also more conservative and less likely to lose principal.

Are you getting the best benefit from your credit cards? Is there another card with benefits that you would get more "back" from using? Is that fee-based Air miles card worth it? Is cash-back better for you?

If you have regular investment withdrawals, can you increase them? Do you like the plan they are going in to? Similarly look over any other long-term debt repayment. Student loans, car loans, mortgage. What is coming up this year, what is "ending". If, for example, car payment will end, how will you earmark that money, so it just does not disappear into general funds.

While you could go over things like these more often, once a year should be plenty often to keep tabs and not obsess.

Good Luck!

1

Things I do annually:

  • Estimate car depreciation
  • Price shop for car insurance
  • Review credit report for errors and get a general sense of who reports what, and who's looking at it.
  • Taxes (duh!)
  • Re-evaluate my W4
  • Consider moving some extra savings into my Roth IRA.
  • Tweak retirement money allocation to target age appropriate holdings.

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