Establishing a financial plan is an important step to financial stability and independence—and critical to helping you see where you are today. But, setting the plan is just the first step. As you reach your goals and your life changes, your plan will need to evolve with you. Here are some ways you can check in on your financial plan.
Recalibrate your income and expenses
In the course of a year, it is very common for people to change jobs, make purchases, or experience life events that create new costs. Is your income and expense list from your initial plan still accurate? If you’ve had a baby, bought a house, moved to a new city—or any number of life milestones—it’s likely you’ll need to update your numbers to reflect your new day-to-day.
Can you cover the unexpected?
One of the first goals many people make is to create an emergency savings to help meet unexpected expenses, or cover living costs in the event of a layoff or other income-impacting event. Take some time to scrutinize your finances and test if you could manage a surprise $500 cost. What about $1,000? How well can you cover an emergency?
If you still feel like your savings could use a boost, keep that at the top of your financial plan. If your savings is in a good spot, consider your next financial goals.
Check in on your debts
Some people find that setting automatic payments helps them make and manage debt payments throughout the year. However, try not to become distanced from these accounts, even if you know you are making all the required payments.
Consider logging in to and exploring any balances you have for credit cards, student loans, auto loans and more. How are your interest rates? Is there any opportunity to refinance or consolidate, or is your current plan working? When are your payoff dates? Are there any debts and balances that can be paid down even faster this year? Stay familiar with these loans and debts so you can target them or track them as your life and finances change.
Dig deeper into your paperwork
Stay with me – it’s rare to find a person who enjoys paperwork. But, it’s a necessary part of life and can be easier to manage if you take time each year to sort and sift through it. Some items that can be especially smart to check in on are:
- Tax documents: Make sure you have everything you need for tax filing, from account statements, health savings account information, gains and losses from investments, mortgage and student loan interest paid, etc.
- Estate plans: It may never seem like the right time but focus on how you can take small steps to plan for your future. Whether that’s setting up or updating a will, naming beneficiaries, or reviewing future needs, the fresh start of a new year may be just the time for checking in.
- Credit report: Hopefully, it comes as no surprise that you can check your credit report for free once every 12 months. Visit annualcreditreport.com‡ to access and make a copy of your credit report from one or all three of the major credit reporting agencies.
Set new goals
If a year has passed (or longer!) since you set some financial goals, take time at the start of the year to figure out what you want to achieve next. Is it boosting your savings or paying off a student loan? Is it making a large purchase or starting to invest? Whatever your focus, commit to it and map out how you can reach it.
Cheers to the New Year and to a sparkly, refreshed financial plan.
Are you new to financial planning? Read our detailed whitepaper on understanding and creating a financial plan that works for you. Download the Understanding Your Financial Review whitepaper now.
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