4 Simple And Incredibly Important Things You Should Do Now

4 simple and important things you can do for your finances now

Now that some of the dust has settled and we are a couple weeks into the new year, here are few items you should check off your list.

As you read through this list you will quickly realize that none of these are URGENT, but don’t be fooled into thinking that the only important things are those that are urgent.

Remember, the best day to replace your roof is when it is sunny.

4 simple and important things you can do for your finances now

1.  Update (or create) your FLOP

A few years ago I created a financial document that I called my Financial Life on One Page (FLOP).  My main motivation was that my wife would have a simple one-stop solution for knowing all of our financial details if I went to be with the Lord a little earlier than expected.

It evolved a bit and now it still serves the same purpose, but it also doubles as a balance sheet helping us track our net worth.

You can read more about it or download our template here (XLS).

2.  Re-evaluate life insurance

Have their been any major changes in your family situation since you last looked at your life insurance?  If so, contact your agent to make the necessary adjustments.

If you don’t have insurance or just want to check rates to make sure you aren’t overpaying you should get a free quote here.

3.  Check your 401k and other investments

If you have a 401k, 403b, or really any retirement savings you should do an annual check on your asset allocation.  For those unfamiliar with this term, it basically means is that you don’t want too many eggs in any one basket.

With the current market, many people will have things out of balance and a check up now would be a good idea.  I use Personal Capital to check mine.  For those who aren’t familiar with it, Personal Capital is a free online tool that connects to all your investments (even IRAs, 401ks, and 403bs) and once your accounts are connected it automatically shows your asset allocation.

Below is a snapshot of what my out of balance account looks like over at Personal Capital.  I will be fixing this soon ;)

Personal Capital Asset Allocation

 

They also have a free Investment Checkup tool that analyzes your investments and gives you feedback about suggested changes you could make.  All-in-all it is a pretty cool tool that I am still surprised is free.

You can find out more in our Personal Capital review (or another one at F&F).

4. Check your credit report

You can get a free credit report from the big 3 agencies at AnnualCreditReport.com.  And you should check this annually.  If you would prefer a set-it-and-forget-it option, CreditKarma offers free credit report monitoring and they will alert you whenever there are changes to your report.

 

So again to remind you – none of this stuff is urgent, just like changing the batteries in your smoke detectors.  But it is very important and those who do the important things before they become urgent find themselves avoiding a lot of urgent situations altogether.  Which group would you rather be in?
















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9 Comments
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  1. Thank you for the valuable information Bob! It is a good reminder that it is smart to be watchful, organized and be prepared. Things do change and we need to keep up with them. Also with all the identity theft happening lately, we must check our credit and our bank accounts on a continuous basis or use the free credit report monitoring services.

  2. What’s with Credit Karma? Signed up but all I get is a loop back to sign uo page. Not some scam I hope!

    • RAC, I have worked with them for years, they are a legit operation – it must be some kind of website bug I guess

  3. Will using CreditKarma affect your credit report, as in will it cause an inquiry on the report affect the score?

    • Rose, this is from their website:

      “Will using Credit Karma lower my credit score?

      No. Credit Karma is making the credit score request on your behalf. Inquires made on your behalf will not be shown to creditors and will not affect your credit score.”

  4. I’ve already updated my life insurance last week. And I’m happy that as of now we don’t have any credit and we are trying to stick on that “hopefully”.

  5. How important are these steps for retired people with a modest saving and income and no debt? I enjoy and follow your articles with great interest but would like to see a few more comments for those with similar circumstances as mine.
    Keep up the good work.

  6. Tracy Kershaw

    I signed up last year and received very valuable information. I utilized several pieces of advice offered including switching my car insurance, the envelope savings and snowball effect. I have a thirty dollar balance on a bill that was over 1500. God is awesome! Both of my teenage children have their first jobs and they are saving already. They will not struggle the way I did
    in the name of Jesus!

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