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5 things for your year-end financial checklist

While it may be easier to put off your financial planning until next year when you make your New Year’s resolutions, there are 5 simple steps you can take now to lay a solid financial foundation for the new year and beyond.

Here are 5 steps to get you started.

1. Check your credit reports

Think of it as a score card for your how well you manage credit. Your score can affect everything from the amount you can borrow and how much interest you’ll pay. It’s important to check your report for any errors. You have the right to review your reports from each of the three major credit bureaus for free once every 12 months. To get your free reports, visit

Tip: Set a calendar reminder to check from one bureau every three months.

2. Check (or create) your emergency fund

As the holidays approach, creating an emergency fund probably isn’t at the top of your to-do list. But it can be a crucial if something unexpected happens ─ from car repairs to job loss. At a minimum, experts say you should have three months of living expenses in your emergency fund. So if you need $3,000 a month to cover your basic needs like your mortgage or rent, utilities, gas, and food, then you need at least $9,000 in your emergency fund.

Tip: Feeling overwhelmed? If you don’t have an emergency fund, just start saving with small steps and set up an automatic deposit into your savings account.

3. Check your budget and spending

One of the best gifts you can give yourself this season is more control over your finances. A good place to start is to compare your budget to your spending. Think about your goals for the new year and see what items you can increase (like saving) or which ones you can eliminate. (Entertainment). If you haven’t created budget, it’s the perfect time to start.

Tip: Impose a 24 to 48 hour waiting period for new purchases. A budget only works if you stick to it.

4. Check your investments portfolio

You probably used good reasoning when you created your investment portfolio, but due to normal market fluctuations, chances are your investments no longer have the same allocation they did when you began.  If you still believe in your portfolio decisions, take time to bring them back into balance by selling off securities that are over-invested and adding to ones that are short.

Tip: A good rule to keep in mind is that whenever any of your investments fluctuates by more than 5%, it's time to rebalance. For example, if your stock allocation used to be 60%, but it now makes up 67% of your portfolio, you could trim 7% off and reallocate that money to other investments. Consult with your financial advisor to help you identify potential securities to buy or sell.

5. Rev up your life insurance

Life doesn't stand still and your life insurance shouldn't either. Did you have a child this past year? Get married or divorced? Lose a loved one? Any time a major change occurs, you should reevaluate your life insurance and make sure it's keeping up with your life. You might need to increase the amount of your coverage, change beneficiaries, or even drop your coverage.

Tip: Set up an appointment with your financial advisor or insurance agent to review your options.

Finally, congratulate yourself. You’ve taken the first steps to gaining better control over next year’s finances.

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