It’s officially 2010 which means you’re starting off with a clean slate. To get this year off right, there are a few financial tasks you must do. (Best to get a start on them today as we know you’re contemplative, hungover and watching “Jersey Shore” reruns on MTV.)
Make this day count:
Commit to Great New Year Financial Resolutions
Instead of trying to shed an extra 12 pounds, plan to put $50 from every paycheck into your savings account. The new year is one of the best times to think about—and reevaluate—the state of your emergency fund. Are you in debt? Make a resolution to get out of debt in 2010 and to generally kick butt this year financially by signing up now for our FREE month-long LV Bootcamp, which starts January 4.
Set Up a System
In the first quarter of the new year, you’ll probably be receiving various year-end account statements and tax documents. Set up a filing system (manila folders, notebooks, computer systems, anything) so that you’re prepared. Make sure that your loved ones know where you keep your files, too, just in case something happens to you.
Calculate Your Net Worth
Grab a paper and pen (or open up Excel). List your financial assets, including a conservative estimate on your home and vehicle, checking and savings accounts, CDs, retirement accounts, everything. Add together for your total assets. Now list liabilities such as mortgages, car loans, student loans, and other debts. Add together for your total liabilities. Subtract liabilities from total assets for your net worth. Whether it’s big, small, or negative, this number will let you know how you’re doing. Resolve to track it monthly.
Make a Mean Budget
If you’re less than thrilled with your net worth (or would simply like to see it higher), the way to manage your spending is by making a budget. This sounds un-fun, we know, but you can do it with thousands of other members of the community if you join our free LearnVest Financial Bootcamp.
Max Out Your IRA
If you contribute the full amount to your IRA ($5,000) at the beginning of the year, you’ll have a tax advantage. That’s because you’ll pay taxes when your money is only worth face value, and you won’t pay taxes on any interest it will accrue during the year. If you can’t contribute the full limit to your IRA all at once, then make a resolution to contribute a set amount every month (and schedule an automatic payment).
Check Your Credit Score
You should be doing this a bare minimum of once per year. For a checklist to guide you through the process of checking your credit report and score, click here.