5 things to top off your year-end financial checklist

5 things to top off your year-end financial checklist for a merry 2022

Year ends are stressful. Use this handy guide to evaluate your current financial position and get set for a happier new year!

1. Do a 60-minute end-of-the-year review

Take time to look back at the past 12 months. Did you stay on budget, or spend more than you had planned? Did you save more or less than what you hoped to? Were you able to pay off debt, or did unexpected expenses set you back?

Be honest as you write down your answers. Even if there are some areas that need improvement, whatever your situation, you can gain control over your money by committing to making those changes.

2. Go over your insurance policies

Life has been full of uncertainties recently which means ensuring that you’re protected is more important than ever. Review any existing policies you or your family have, especially life insurance, homeowner’s or renter’s insurance, car insurance, and health insurance, and ask yourself a few questions:

Does the original reason you needed coverage still exist or should you look at other insurance products?
Do you need more or less insurance in the coming year?
Do your deductibles need to be adjusted?
How do your insurance policies fit into your budget for the year? What changes might you need to make?

Going through each of your policies one by one will help you get a better sense of where your money’s going and help you feel a bit more prepared, just in case.

3. Plan for large expenses coming up in the next 6-12 months

Are you expecting any major life events within the next year, such as a wedding, divorce, birth, or starting college or a small business? Is there a big medical procedure on the horizon? Maybe your home needs repairs, or you need a more reliable car.

Whatever your financial situation, when it comes to paying for large expenses, you have options: saving up the cash, taking out a personal loan, using a credit card, refinancing your existing loans, and more. Just be sure you do it without hurting your finances. Take on new debt only if you can fit the monthly payments into your budget. And do your research to find the best terms and lowest rates possible.

And if the past couple of years has taught us anything, it’s to expect the unexpected, so remember to factor in an emergency savings plan for unforeseen costs that may come up.

4. Review your portfolio — diversify if need be

Take a close look at your investments.

We saw how quickly the world changed when the pandemic began. So, too, can your life situation. Make sure your financial plan still fits you. Did you just get a large year-end bonus? Or perhaps your job is less secure than it was last year. As your life changes, your investments and financial portfolio might need another review and alterations.

Your investment portfolio should be appropriate for your age and how well you tolerate risk.

Your portfolio should reflect investment objectives that are appropriate for your current life stage. Your age, risk tolerance, tax status, and time horizon, among other factors, are all important.

5. Make a financial New Year’s resolution

Every new year presents a fresh, new beginning. What are your financial goals? Will you finally pay down your debt, or improve your credit score? How much would you like to see in your emergency fund in 6 or 12 months from today? Maybe you’d like to get some retirement planning started or consider a home loan. Or maybe you want to diversify your existing portfolio or start investing for the first time (even if it’s just a small amount). Whatever your financial goals, write them down, create some milestones, and think positively.