12 Actionable Steps to Improve Your Financial Outlook, Ep #127

As we come upon a new year it is a good time to reflect on your finances and set goals.

In this episode, we discuss 12 steps you can take action on to improve your financial outlook. If you’re looking to get off on the right foot in 2021, print out this checklist and run through it to find improvements you can make now.


12 easy steps you can take to improve your finances

  1. Record your financial goals and positive habits. Writing things down is a great way to hold yourself accountable and see how far you have come. When you write down your goals you can refer back to them later. Our clients have the added benefit of using our Global Dashboard to help them keep track of their financial goals and habits.
  2. Check your estate documents. This is something that we all push off until later. Do your heirs a favor and review your estate documents now. Are they up to date? This can save your family a lot of headaches.
  3. Set up an income and expense tracking tool. You need to have an understanding of how much money is coming in and going out each month. When you start tracking your income and expenses you may discover a lot about yourself. It’s also a good idea to compare your cashflow this year with years past. What has changed?
  4. Make sure you have emergency savings. The general recommendation is to have 3-6 months in an emergency fund, however, this can be specific to you and your situation. You may need more. If Covid-19 has taught us anything, it’s that the world can throw you some unexpected situations and it is important to be ready. Where is your emergency savings fund?
  5. Match and max your 401K. Are you taking advantage of the company match in your 401K? Can you amp up your 401K? It is important to remember that the company match amount is not the maximum that you can save. $19,500 is the IRS maximum per year. Are you maxing out your 401K this year? Did you have to make any adjustments to your savings?
  6. Review your investment strategy. There have been so many changes this year in the stock market this year. Your stock allocation may have grown so it is a good time to check whether your allocation is in line with your investment strategy. Remember that investment behavior is much more important than individual stock picks.
  7. Make sure you are maximizing tax efficiency. Are your assets the most tax-efficient? All accounts are taxed differently. Think about what assets are best to hold across which accounts.
  8. Pay down high-interest debt. Many times we tend to ignore our high-interest debt, but it is important to understand how often you use debt. Focus on the interest rate and balance of your debts. What is your overall debt? Is it good debt or bad debt? Listen in to hear what we think of different types of debt. Our thoughts may surprise you.
  9. Order your free credit report. Every year around the holidays there is an increase in fraud. Try using Credit Karma to keep track of your credit score.
  10. Review your insurance policies. Do you still need life insurance, disability, or an umbrella policy? You may be carrying too much insurance.
  11. Show me the money! Understand where your accounts are and how they are structured. Keep an inventory of where your accounts are and consolidate them if needed. Its easier to make decisions when you are organized
  12. Communicate with your spouse. Are you both on the same page financially? Has your financial situation changed this year?

After listening to this episode feel free to download this sheet and print it off to use it as a checklist.

Outline of This Episode

  • [1:50] Record your financial goals
  • [4:33] check your estate documents
  • [6:30] Implement an expense tracking tool
  • [8:41] Make sure you have emergency savings
  • [11:42] Review your investment strategy
  • [14:38] Make sure you are maximizing tax efficiency
  • [17:23] Pay down expensive debt
  • [19:30] Order your free credit report
  • [25:25] Communicate with your spouse

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