Spring Cleaning Your Financial Life!

On a sunny, beautiful day like today, our thoughts all turn to Spring. It is Spring cleaning and tax prep time here at Lantern Financial! What a better way to get your financial life in order than to plan a "Financial Spring Cleaning Day" for yourself? Which day will you set aside to get organized? What challenges will you tackle? We have some suggestions for you!

TIP #1: Update your filing system. Make sure your organizational system is working for you. It should be something that works well for you and that you will stick with after you set it up. Are you a "filing cabinet" type of person? Would you do better with a shoebox for receipts and papers that you organize once or twice a year? Whichever system you choose, the important thing is to set yourself up for success by getting organized! How do you keep your files under control?

TIP #2: Are your beneficiaries up-to-date on your retirement accounts and life insurance policies? Do you still have your mom listed, or (yikes!) that old girlfriend you were dating when you first started your job? Beneficiary designations trump any desires you might indicate in your will, so even if you think you remember - it's always worth a double-check! Maybe you should call HR over lunch, just to be sure.

TIP #3: How balanced and diversified is your 401(k)? Has it been a while since you considered whether the mutual funds you picked are working well for you? You should review and consider rebalancing your investment portfolio at least once per year to make sure it doesn't drift too far from your intended target.

TIP #4: Who will get your house if something happens to you? Who will take care of your kids? Have you decided? Does anybody know? It's always tough to think about these things, but there is no time like the present to have a will created. It is much preferred to get it done now, rather than leave the confusing decisions (and potential arguments - not necessarily ending with your intended conclusions!) for your loved ones to deal with during such a difficult time.

TIP #5: What big changes have occurred during the past 12 months for you? Chances are (and based upon our Facebook newsfeed!) there has been lots of good news to report - new houses, marriages, babies, job changes, new cars, etc. Congratulations! Whenever new life events are afoot, it is time to consider your various insurance coverages to make sure you are adequately covered. Life, Long-Term Disability, Homeowners, Renters and Auto insurance policies are all worth reviewing. When is the last time you checked?

TIP #6: You wish you could be saving more toward retirement but with all of your "here and now" responsibilities to worry about, it can be stressful to think about your future. One way to do so with less pain is to increase your retirement contribution this month by 1% of your income. You will hardly notice (we promise!) but it will make a big difference later! Commit to increasing again by 1% (or more) next year, and each year after until you reach the government allowed maximum.

TIP #7: How is your credit? Do you know? There are lots of new rules swirling around about credit use these days, and it is more important than ever to know where you stand. If you have not done so in the past 12 months, order your free credit reports today from http://www.annualcreditreport.com. It is a law that you are entitled to one free credit report from each of the three reporting agencies each year (your credit score is available as well for a small fee, but may be worth considering).

TIP #8: What would you do if you found a bunch of money lying around your house? You should think more seriously about that question, because you probably have more "money" hiding in the nooks and crannies than you realize! Are you using all of the employment benefits you are signed up for at work? Often people don't think to do things such as get a new pair of glasses/contacts each year they are eligible, or use every last bit of the money in their flexible spending accounts. Spend some time reviewing the benefits you signed up for, since you might have some great things available to you!

TIP #9: When figuring out how to trim your budget, you might think that you can't do anything about your fixed expenses... but is that actually true? A little research and a conversation or two might save you some serious cash! Have you ever realized that you are probably paying more than you could be for services like cable TV and internet? Look around online and compare. Then give your provider a call - tell them that you would love to continue as their customer, but have been offered a better deal? What can your provider do to keep you? You might be surprised at their willingness to help you out and keep you happy! This tip applies to bigger expenses as well. Have you considered refinancing your mortgage to take advantage of lower interest rates? How about looking for a more affordable apartment when your lease is up? Your fixed expenses may be less fixed than you think!

TIP #10: Have you completed your tax return? The deadline is quickly approaching and you may be annoyed with all the extra time it takes to gather all of your paperwork, forms and receipts. Now is a great time to set up a simple system for next year to gather all of your tax related documentation throughout the year. It could be a filing system or as simple as a dedicated box for all tax related paperwork. You may be pleasantly surprised in 12 months when you find you have more deductions than you might have remembered without keeping careful records!

Which of these 10 tips do you think is most important and why? Either comment here in response to this blog post, or visit us on our Facebook fan page and leave a comment there to let us know. The best answer in our opinion will win a $25 gift card to Bed, Bath & Beyond! We look forward to hearing from you!