Solutions to Make Better Decisions with Your Taxes and Money

7 Steps to Complete a Mid-Year Financial Check-Up

7 Steps to Complete a Mid-Year Financial Check-Up - TaxAct Blog

Annual wellness check-ups are a great way to keep tabs on your health and ensure you’re making the right choices for your mind and body.

But, when it comes to your personal well-being, are annual check-ups only for your physical health? What about your financial well-being?

Just like scheduling dentist appointments and yearly visits with your primary care doctor are important, finding time on your calendar to check-in on your finances is essential too. With half of 2017 behind us, now is a great time to do a mid-year check-up on your financial health.

Here are seven tasks to complete during your check-up.

 1. Double check all subscriptions.

Let’s start off your mid-year financial check-up with an easy assignment. Use your monthly credit card bills and bank statements to evaluate all your subscriptions. This includes magazines, newspapers, product boxes, food prep services – and yes, even your monthly wine delivery.

Ask yourself if you still want to pay for all those services. It’s often easy to sign up for a free, week-long trial and forget to opt out before you begin paying $8.99 (or more) a month for the service. It’s also common to pay for newspaper or magazine subscriptions that you never actually read.

Take the first step toward cleaning up your expenses by unsubscribing from anything that unnecessarily drains your wallet.

 2. Negotiate your cable and internet bills.

Brush up on your negotiating skills and save yourself some money by reaching out to your cable and/or internet provider to inquire about lowering your monthly bill.

While it might sound like a waste of time, you’ll likely be surprised what the company will do to keep your business. That’s especially true if a competitor is in town.

And if you can’t agree on a price, you can always switch providers entirely to get a lower rate. Or, maybe it’s time to cut the cord and get rid of your cable or internet all together. Taking the time to review your finances can quickly help you realize where your priorities lie when it comes to your budget.

 3. Bump up your savings rate.

Use a mid-year financial check-up to evaluate your retirement and general savings funds. Is it time to step-up your savings game? Bump up your 401(k) contribution by at least one percent, and do the same to your general savings too.

For an added challenge, try increasing your savings rate by one percent every two months until December.

 4. Shop around for insurance.

When did you last shop around for better rates on your auto, homeowner’s or renter’s insurance? Or, do you know if you’re getting the most out of your health insurance? Unfortunately, just like our cable and internet bills, many of us forget we don’t have to stick with the same company and can always shop around for a better price.

It is typically easier to switch auto and homeowner’s insurance mid-year than health insurance providers, however. That’s why it’s important to  make sure you’re at least taking advantage of all your annual= primary doctor visits that are 100 percent covered by your provider. You should also keep up with contributions to any FSA or HSA options you may have through your employer.

If you decide to switch auto or homeowner’s insurance policies, always double check the fine print to see if there are cancellation fees mid-policy.

 5. Consider adjusting your tax withholdings.

If you’re a traditional employee, have you checked in on your tax withholdings since you last filled out your Form W-4? Now is a great time to take a few minutes to review your withholdings and make any changes.

If you had a major life event, such as getting married or having a baby, you might want to update your withholdings to match your new tax situation..

Additionally, you may want to adjust your withholdings based on your previous tax return. For example, instead of receiving a big refund during tax season, you could keep more of that money in your own pocket during the year by adjusting your withholdings appropriately.

When it comes to your tax refund, your goal should be to not receive a refund, which means you are all paid up on the taxes you owe and didn’t  over pay the government during the year resulting in a refund.

Not sure how to do that? Use the TaxAct Paycheck Plus calculator to walk through a step-by-step guide.

6. Take a second look at your debt repayment plan.

For the average American household, constantly working to pay down debt is reality. But, not everyone gets aggressive about debt repayment by creating a plan.

If you’ve already created one, take a few moments to check in on how you’re doing. Are you on task to be where you wanted by December 31, or is it time to recommit yourself to slaying the debt dragon?

Do you not have a plan? No problem! Take some time to put one together. Start by researching popular debt repayment methods, such as Dave Ramsey’s “debt snowball” or “debt avalanche”.

Also, check to see if a balance transfer would work in your situation. And always pay more than the minimum due!

7. Create overall financial goals.

Mid-year is the perfect time to check in on your financial goals, but it’s also the perfect time to set some if you haven’t already.

It’s best to have short, medium and long-term financial goals for yourself as well as your partner and/or household. However, setting the goals alone isn’t enough.

It’s best to complete semi-regular financial check-ups (more than once or twice a year). Use the pre-determined deadlines to do a little backwards planning on how to achieve your goals.

About Erin Lowry

Erin is a millennial personal finance expert and the founder of BrokeMillennial.com. She's also the author of Broke Millennial: Stop Scraping By and Get Your Financial Life Together. Lowry and her work have been featured on CBS Sunday morning, CNBC, Fox & Friends, USA Today, The Wall Street Journal, Cosmopolitan and NBC News. Connect with Erin on Twitter, Facebook and Google+.

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