Mid-Year Checkup — 8 Steps to Finish 2017 Fiscally Fit

How are you doing on your New Year's resolutions? It's time to measure progress on your savings and other goals, and make adjustments.

We’re at the midpoint of the year: Are you halfway through your financial New Year’s resolutions?

Many of us think we are, but quick checks prove we have some work ahead of us to meet financial goals by next January.

Follow these eight easy steps for a thorough mid year financial checkup:

1. Review your goals

Your money should always be working toward something. If you set a financial goal at the beginning of the year, now is the time to check your progress.

For example, if your goal was adding $1,800 to your savings account this year, you should already be $900 toward your goal. If you’re not there, make a plan to catch up.

If you don’t have a goal yet, it is not too late to make one. Besides adding to savings, other goals might include:

  • Adding to your emergency fund
  • Paying down debt
  • Making a down payment on a house

Once you have a goal, start tracking it. A pencil (with eraser) and paper may do, but online tools are available, too.

For example, PowerWallet is an advanced, easy-to-use tool for organizing and viewing all of your financial accounts in one secure place. There, you can set budgets, monitor spending and achieve your financial goals.

PowerWallet is available through the Money Talks News Solutions Center.

2. Check on your investments

Pull recent statements and check your investments. Do you have a good mix of stocks, bonds and cash savings? What’s up — or down?

The right mix depends on your age, investment goals and risk tolerance. Money Talks News founder Stacy Johnson offers this guidance:

To decide how much to put in loaner investments (the bank) and how much to put in owner investments (stocks or real estate) here’s your rule of thumb: Subtract your age from 100 and that’s the percentage you might want to put in stocks. So if you’re 25 years old, you’d take 25 from 100 and put that amount, 75 percent, of your long-term savings into stocks. If you’re 75 years old, you’d only take that kind of risk with 25 percent of your savings.

If your investment portfolio can use an upgrade, there are plenty of ways to invest, even if you don’t have much money. Mutual funds are one great option. You no longer need $1,000 upfront to get in: Many funds let you invest with an initial $250 and payments as low as $50 a month.

Morningstar has a mutual fund selector to help you find the right fund for you. The Money Talks New Solutions Center can point you to the top online brokerages, many offering low trade fees or introductory free trades.

And don’t forget to check your savings account. Are you getting the best rates available from your bank? You can compare rates in the savings section of our Solutions Center. Also, consider whether a credit union might be right for you.

3. Check on your retirement plan

If you have a company-sponsored 401(k) plan, make sure you’re enrolled and contributing enough to get the full company match. If you’re not, ask the human resources department how to bump up your investment.

If you don’t have a company 401(k) plan, or simply want to save more for retirement, consider an individual retirement account. If you’re younger than 70, you can contribute to a traditional IRA.

The tax rules get a bit complicated, but the IRS has listed all of them in Publication 590-A, Individual Retirement Arrangements. Still confused? Check out our story on IRAs and 401(k) plans.

4. Update your tax profile

If you’ve gotten married or divorced, had a child, changed jobs or experienced a pay cut, your tax withholding might be inaccurate, causing you to pay too much. As my dad always says, “Taking too much out of your paycheck is like giving the government an interest-free loan.”

To calculate a new withholding, use the IRS Withholding Calculator. You’ll need:

  • Your most recent pay stubs
  • Your most recent tax return

If an adjustment appears to be in order, ask your employer for a new W-4 form and fill it out to change the withdrawal amount.

5. Pull your credit history

Visit AnnualCreditReport.com, get a free copy of your credit report and do a mid-year checkup on your credit history. There are a lot of ways to improve your credit score, but it all starts with getting a free credit report and looking it over.

Always check your credit reports for errors. If you find any, dispute them with the credit reporting agencies.

Once you know your score and are sure your credit report is error-free, take additional steps. Pay down your debts. Aim to get your balances below 30 percent of your available credit limit. Better yet, pay them off entirely.

Pay any past-due accounts and keep them current.

6. Check on your FSA

Do a quick review of your flexible spending account. Find out how much you’ve contributed this year and tally up how much you’ve spent so far.

Since we’re six months into the year, you should be halfway through your FSA account balance by now. If you’re not, make a plan to get through that money by Dec. 31. Your grace period or carry-over options are limited. Here are a few things that can help you spend down your FSA balance:

  • Teeth cleaning
  • Annual physical exams
  • Prescription glasses and contact lenses
  • Prescription medicines
  • Over-the-counter medicines
  • Medical equipment such as blood pressure monitors, first-aid kits and braces

7. Track your recent spending

I may be alone in this, but I’m at my financial best in the beginning of the year. After New Year’s Eve, I’ve made my money resolutions and am watching every dime I spend.

A few months into the year, I start to slip. I’ve forgotten all the plans I made — and I’m back to old habits.

To get focused, I track my expenses for 30 days around June or July. I track every dime I spend — including cash purchases — by category. Then, I go through and see where my “money leaks” are.

Last year, I was dining out a lot. I was $130 over my restaurant budget one month. But once I saw it in black and white, I stopped overspending and plugged the leak.

8. Update your budget

If you created a budget at the beginning of the year, it may need some fine-tuning. For example, I realized I overestimated my monthly grocery bills by about $75. Now that I know, I can reallocate that $75 to my savings goals.

After tracking your spending, add up the categories and compare them to your budget. Adjust your budget for any overages and put that money to better use — such as padding your savings or paying down debt.

So how is your money doing? Are you on track to make your financial goals this year? Let us know why by commenting below or on our Facebook page.

Jim Gold contributed to this article.

Angela Colley
Angela Colley @angelancolley
My personal tag line might be, “There is probably a coupon for that.” At a young age, I mistook my parent’s coupon clipping for a game and I wanted to treasure hunt ... More

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