Essential guide to planning your money moves
‘Winging it’ is for best man speeches, not planning your financial future. By categorizing money tasks by time intervals you can take back control over what’s happening next. Below is an outline that would fit into many lifestyles, yet can be customized for more unique scenarios.
DAILY
Review banking / credit card account info
Don’t let this be tedious. You can literally open your banking apps with your face in seconds. Take a minute away from watching those cute puppy videos on TikTok and review your checking, savings and credit card account info. If something is wrong you want to know it right away.
Look at the current balances, pending transactions and recently-posted transactions. Once you get into the habit of checking your accounts daily, you’ll be surprisingly accurate with guessing what balances you can expect to see. You know where you and your family usually spend money so spotting out-of-place transactions is a breeze.
WEEKLY
Contribute to savings account for planned expenses
Review the known expenses that you incurred in the past 12 months. Add these together, add a bit more for Murphy’s law then divide by 52. Set this amount aside in a dedicated savings account and use it as expenses arise.
You can get very close to forecasting your known expenses. Don’t let lack of planning derail your budget and throw you off course. Common expenses that many families can expect to incur every year might include:
- Home / vehicle repairs
- Insurance premiums (home, auto, life, etc.)
- Property taxes
- Medical / dental deductibles & co-payments
- Veterinarian services
Review pay stub for accuracy
This might seem like common sense, but with migration to direct deposit and paperless check stub delivery, a payroll error can easily go unnoticed. However you get paid, ensure that you invest the minute or so to log on to your payroll admin and review the income and deductions for accuracy.
MONTHLY
Update your net worth
Need a little motivation? Track your progress! Not many people like hard work and sweat for no reason. Updating your net worth should not be a chore; it should be a time of reflection. What are you doing right? Did anything go wrong? What was unexpected that needs attention paid to it next month / quarter / year? Seeing progress toward hitting your net worth goals is healthy and well-deserved.
Download and/or print savings account statements
Most banks store statements for well over a year on their websites. If you want to keep more than what they store, or you prefer to ‘own’ the data on your accounts, download or print out the statements regularly.
QUARTERLY
Change passwords (monthly in some circumstances)
Every passing day leads to more and more people doing their financial business online. From banking to investing to peer-to-peer payments servicing, playing defense against potential threats is increasingly critical. Change you passwords early and often.
Download and/or print investment account balances and summaries
Same as above with the banking statements, but since investments portfolios generally recap performance on a quarterly basis, it is not practical to download them monthly. Do it every quarter.
Review investment strategies and performance with financial planner
Obviously this is only going to apply if you have a financial planner. Sure, you might talk to them on a more frequent basis, but if your contribution elections are set the way you want them and you are on ‘autopilot’, it’s a good idea to chat with them every 3 months. Make sure that your strategy is still on track to meet you goals. Ask them their thoughts on the last 90-day and 12-month performance. What do they see happening in the next 90 days? 12 months? Just stay in touch.
Review tax withholding with accountant (business owner/W9 contractor)
Same as above but with your accountant.
ANNUALLY
Review credit history reports
The federal government authorizes one free credit report from each of the three credit reporting agencies every year. Visit annualcreditreport.com to access these reports. Review the reports for accounts that you don’t recognize, accounts with inaccurate information (open and closed accounts) and credit inquiries within the past 12 months.
Review insurance needs and companies
This annual activity could save you money. Keeping insurances companies honest by shopping rates can go a long way. Many policies will auto-renew if you have a valid payment method on file with the company. Like most subscription services, this SCARES me. It opens the door for errors to go unnoticed or services to continue even if you no longer have the need.
Prepare and file income taxes
Online tax software, pen and paper, accountant – it doesn’t matter. Just make sure your taxes are prepared accurately and submitted to the government entity on-time.
Review estate plan
Life changes such as marital status, addition of children, and changes in health can be reason to make amendments to an estate plan. It is important to review legal documents such as wills, trusts, power of attorney elections for accurate information. Some items to review may include:
- Executors
- Guardianship
- Beneficiaries
- Tax consequences
Every Now And Then
Life changes are inevitable. When they do occur, think about how they will impact you finances. Some things will not affect them at all while others will need your attention or the help of a professional. Stay in the know and be proactive to keep on track.