Well, you have likely noticed that it is time for resolutions according to the plethora of fitness equipment and organizational plastic bins on sale in every flyer you open. It seems fitting that we take a 4 step approach to positioning yourself for financial fitness in 2017 as well.
So first of all, I am going to go ahead and assume you are human. Yes? If so then please know that you are not slacker! Almost every person I have met has something in their financial world they have been meaning to get to but have not so forget the past and let’s move onward and upwards!
Step 1 – Write down your goals. Study after study proves that actually writing out what it is you want causes the synapses in your brain to reconnect to work towards the goal even when you are not thinking about it.
Step 2 – Just do it! Seems I heard that somewhere before but anyways. It is now time to actually get everything in place.
* Will – Call around and get some quotes on having your will prepared with all the necessary paperwork by a reputable lawyer.
* Financial/Insurance Planner – People who work with a qualified financial planner do much better overall than those who wing it. Meet with a few of them and learn what you need to know so that your pennies turn into a comfortable future
* Accountant – The onslaught of cheap software makes it very easy to think you can do it all yourself when it comes to your taxes but a qualified accountant is essential in my opinion. They can literally save you thousands on your tax bill. That’s your money so you should keep it.
* Mortgage Professional – Your home is your largest asset and your largest debt obligation. Have your mortgage reviewed by a Greg Viger Associate to make sure you are in the best mortgage product for your situation now and to meet your goals later.
You will have noticed a theme here. You don’t need to know about the law or investments or insurance or taxes or mortgages. All you have to do is find yourself a TEAM to protect your interests.
Step 3 – Time to automate-
Set up to meet your goals automatically. A regular withdrawal for your savings and other expenses is far less painful and way more likely to actually occur than if you have to sit down each month and choose to transfer the funds. If your goal is to pay down your mortgage, why not choose to increase your payments slightly rather than worrying about a lump sum later on. Bite sized is far easier.
If you are trying to keep a budget, there is an amazing app called mint.com. It is from the makers of Turbo Tax – you input all your credit/debit card info, your goals as far as savings or debt reduction, and a budget for each part of your life. Each purchase you make is automatically inputted into the correct category. You can see where you are spending and exactly how much and you will even get text notifications when you are close to your budget in a particular area.
Step 4 – Annual Review Day
So you have done the work and so now all you have to do is take 1 day a year off to review. Meet with all of your team to ensure you are where you need to be. Can you increase your mortgage? Is your will reflecting your new spouse or baby? Do you have enough insurance to protect yourself against disability or critical illness? Spoiler alert! We are all going to need life insurance, disability is the number one case of foreclosure and even out solid health care system does not cover all expenses so critical illness insurance can save your savings.
And there you have it, financial fitness in 4 steps! Your future self will thank you. As they say, the best time to plant a tree was 20 years ago, the second best is today.
Contributed by our Associate, Pam Pikkert of DLC Regional Mortgage Group