Disclosure: This post is sponsored by Armed Forces Insurance (AFI).
The end of the year brings a whirlwind of activity. For some, preparing for and celebrating the holidays takes a lot of time and attention. For others, it’s a time for reflection of the year’s events, both good and bad. While spending time with loved ones and reflecting on the ups and downs are important, the end of the year is also a perfect time to review your financial standing.
An end of year audit allows you to view the whole picture of your financial activity over the past year. It provides you with an in-depth look at where you succeeded and where you may have stumbled. Life is not stagnant and neither should be your financial well-being. It’s a great time to make minor adjustments or big changes overall.
Track the Ins and Outs
Hopefully you have been following a budget all year, but if you haven’t, now is the perfect time to set one up. There are a myriad ways to keep track of your income and expenses, from Excel sheets to mobile apps. Find a method that works best for you and input your information. Analyze how much income you earn over a month and a year, and do the same for the amount of money you output for expenses. Take the amount of money from debts that you have paid off during the year and roll it into savings or towards paying off another debt.
Set Your Goals
Who said a New Year’s resolution needs to be about going to the gym? The start of a new year is the perfect time to get financially fit and set financial goals. Starting a vacation or holiday savings account is an easy way to start. By setting up automatic deposits, this will be an easy goal to meet.
Are you expecting PCS orders sometime in the upcoming year? Setting aside some cash for the out-of-pocket expenses involved in a move can help reduce stress until you receive reimbursement. Reducing your debts is another goal to focus on once the clock strikes midnight on January 1. Looking at your budget will help you see where you can redirect funds.
Protect What Is Yours
Your insurance policies may not renew on January 1, but the end of the year is a perfect time to review what each policy covers, including your Valuable Items Policy. If you received any jewelry, electronics, collectibles or antiques, you should add them on to your policy or create a new one.
Insurance policies are not your only means of protection. Each adult in your family should have a will, a medical power of attorney (also called a medical proxy) and a general power of attorney. If you don’t have these, now is the perfect time to have an attorney draft them. If you’re near a military installation, chances are a JAG officer will be able to write these documents for you at no cost.
You don’t need to be a CPA or hold a degree in Financial Advisement to audit yourself at the end of the year. Taking a little bit of time at the end of the year to review, adjust and plan will go a long way in ensuring that you have a happy and healthy New Year.
Sponsored: Since 1887, AFI has been providing insurance policies for America’s military service members and their families. To learn more about AFI’s insurance products, click HERE.