Question: What should I do to wrap up my financial year and get a good start on 2014?
Answer: Now that it is December, it's time to start thinking about some adjustments to get the New Year started off right.
First, you should get your financial records in order. Organize your financial information, so you're prepared when tax time rolls around.
If you're considering any charitable giving, do it now in order to claim it on your upcoming tax return. The same goes for any contributions to retirement savings. Make them now to reap the tax-related benefits.
If you have a health savings account through your employer, check to see what the balance is. If necessary, make some allowed purchases to spend down the account so you don't lose the money.
Evaluate your unsecured debt. Is there anything you can pay off or pay more toward before the end of the year? There are no tax benefits associated with paying down debt, but it will improve financial stability in the coming year. If the debt is more than you can handle on your own, consider contacting a nonprofit debt counseling organization, which may be able to provide assistance in managing your debt. Always investigate such agencies through the Better Business Bureau to make sure they are reputable organizations.
Check your credit report. All consumers are entitled to a free credit report from each of the three credit bureaus annually. If you haven't checked yours yet this year, go to www.annualcreditreport.com and request the report from each of the bureaus. Review it to make sure it is accurate. If anything is incorrect, contact the credit bureau in writing to fix the error and have it removed from your credit report.
Next, you want to start thinking about your financial goals for 2014. Think about where you want to be financially in a year. If your goal is to pay down your debt, take an honest look at your budget. Is there any area where you can reduce spending and instead increase your debt payments?
The same information can be applied to increasing your savings. Maybe you cut back on eating out or trips to the mall and put the extra funds toward your savings.
A savings goal for 2014 could be to better prepare for the holidays. Take a look at what you have spent so far this month and keep track for the rest of the month. Total it up and divide by 12. You'll know exactly how much you should be setting aside for the 2014 holiday season.
If you have bigger goals, like buying a house or a car, check your credit report. Is there any information on there that will affect you negatively when you are applying for a mortgage or a loan? Maybe you can pay off some old collection accounts or make an effort to pay your bills on time each month.
Start to figure out what it will take to accomplish your financial goals and put a plan into place, so come January you're ready to get started.
Heather Murray is manager of education and resource development for Advantage Credit Counseling Service (dba Consumer Credit Counseling Service). For more information about the agency's services, visit www.advantageccs.org, or to access the free online budgeting tool go to www.onlinebudgetadvisor.com. Money or credit management questions can be sent to email@example.com. Please provide your name, address and daytime telephone number. Because of the volume of questions, Ms. Murray cannot always respond.