Doing these things can help you start the new year off right.
the main points
- The beginning of the year is a great time for a quick financial review.
- This can help you detect minor issues before they become major problems.
- Pay special attention to your insurance policies and emergency fund because this protection is essential when unexpected costs arise.
A pledge to improve your finances is one of the most popular New Year’s resolutions, but it’s not always easy to know where to start. Fortunately, it doesn’t always take huge changes, like saving a quarter of every paycheck.
There are so many simple things you can do that will continue to reward you all year long. Here are three finance optimization tasks that will only take about five minutes.
1. Update life insurance beneficiaries
those who have life insurance An annual review should be scheduled, to ensure that they have adequate coverage and to keep beneficiaries up to date. Beneficiaries are those who receive a death benefit after the policyholder has passed, and lapsed beneficiaries can cause all kinds of problems for the family members left behind.
A person who is recently divorced or widowed may need to choose new beneficiaries, and those who have welcomed another child into their family may wish to update the list of beneficiaries to include the new addition.
Policyholders who are not sure how to make this change should contact their life insurance company to find out more. If they have access to an online account, they may be able to make the change themselves. Or they may have to contact an agent for assistance.
2. Review your emergency fund
With the high inflation we faced in 2022, it is possible that you might have emergency fund It just doesn’t fit anymore even if you haven’t spent any in the past year. This fund is supposed to contain at least three months of living expenses to help you cover unexpected costs that arise. But now that most living expenses have gone up, you may need to increase your emergency savings to avoid a crisis.
You may also need a larger emergency fund if your family’s finances change dramatically. Getting a new job or welcoming a new family member can increase the amount you need to put into your emergency fund. Conversely, if family members move out or your average monthly expenses drop, you may be able to save less money.
3. Cancel unused subscriptions
Canceling subscriptions you no longer use is a simple way to add a little extra money to your bank account each month. It is very easy for most people to review their monthly subscriptions because they get billed frequently. But not all subscriptions bill you often. Some may charge you every few months or annually, and it can be difficult to track down.
It is a good idea to look back through your bank and Credit card 2022 data to make sure you don’t forget any paid subscriptions. These could be things like physical gym memberships or subscriptions to online services, such as streaming platforms.
Taking the above three steps is far from a comprehensive financial review, but it can give you a good head start. If you have retirement account or a monthly budget that you stick to, keep reviewing these things as well to make sure you’re on track to achieve your long-term goals. It doesn’t have to take a lot of time and can help you identify small issues before they turn into big problems.
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