Financial Checklist for the New Year: 7 Essential To-Dos

by Cristy Lynch | January 03, 2019

New year, new you, new resolutions — it’s that time of year when we get to hit the reset button and start fresh.

Whether you choose to sign up for a gym membership (again) or pick up a new hobby, there’s one thing that even the savviest personal finance aficionado should not neglect: your wallet.

Not sure where to start? Our financial checklist for the new year will help get your financial priorities back in order for 2020.

1. Set financial goals.

People who set explicit resolutions are 10 times more likely to achieve their goals than others who don’t.

Are you trying to eliminate student loan debt? Are you saving for your first home? What’s the timeline? Three months? Three years?

Create specific short-term and long-term goals and determine what you need to do now to accomplish them. Think SMART (specific, measurable, achievable, results-focused, and time- bound).

Don’t just say you want to save money. Pick a specific goal, like $1,200 in six months. That means you’ll need to save at least $200 per month. When you reach that goal, you’ll feel a greater sense of accomplishment.

2. Track your spending.

Do you know where every dollar of your paycheck goes? If you’re like most Americans, you probably don’t. In fact, only 41 percent of Americans budget at all.

Try one of the free budgeting apps like Mint, Wally, or PocketGuard to get started. If you need something more hands on, you might prefer You Need a Budget (YNAB) or Tiller. Both offer free trials.

3. Review your retirement savings.

Create (or reevaluate) your retirement investment plan. Determine the age you want to retire and how much you’ll need to live on for the rest of your life. If you’re at square one, a fee-only financial planner (aka no-commission financial advisor) can help you navigate retirement planning. Or you could use Personal Capital to help you get started, they offer budgeting and retirement planning as well as financial advisors to help you if needed.

Do you have a 401k? Does your employer offer a match? If so, make sure you’re contributing enough to receive your employer’s contribution. It’s free money you’re leaving on the table!

You may even want to increase your contributions by a percent just to be more aggressive about saving for retirement.

Don’t forget to rebalance your portfolio. Once a year, the weight of each asset class needs to be set to its original allocation, or updated in case your goals have changed. This includes buying and selling portions of your portfolio, as well as making adjustments based on risk tolerance or strategy.

In some cases, rebalancing is as easy as a click of a mouse. Other times, it may require some more TLC. (This is where your financial planner can assist.)

4. Boost your emergency fund.

Financial experts recommend saving anywhere from three to nine months of expenses. But most Americans don’t even have $500 in savings. Yikes!

For those with zero dollars in savings, aiming for months’ worth of expenses may seem daunting. Don’t be discouraged. Start with baby steps. Set a (short-term) goal of just $1,000 in emergency savings. From there, aim higher and higher until you reach one month’s expenses, then two, and so forth.

5. Check your credit report.

Probably the most infamous target of all data breaches is Equifax. An estimated 143 million consumers had their personal information, including social security numbers, compromised.

The good thing is that you can monitor your credit report for free. Both Credit Karma and Credit Sesame offer free credit report and credit score monitoring.

You can also get your free, annual credit reports from all three credit agencies at (Pro tip: Spread out your free credit reports by accessing only one credit report every four months. That way you can keep an eye on your credit throughout the whole year.)

Dispute any errors or inaccurate information with the credit bureaus. While you’re at it, consider freezing your credit, too. It’s the only surefire way to guarantee no one can open lines of credit under your name, not even you, unless you thaw it first.

6. Write your will.

Do you need a will? Most likely yes.

Do you have property? Do you have a business? A will outlines exactly how you would like to distribute your assets when you pass away. Do you have children? You get to choose their legal guardian. If you don’t have a will, your state will determine who gets what – including custody of your children.

To write a will, you don’t necessarily need a lawyer. Websites like LegalZoom, Nolo, and Rocket Lawyer are low-cost options for the DIY-minded. However, if you have a more complicated estate, or have an ex-spouse, it’s probably best to consult an estate attorney.

7. Evaluate your insurance coverage.

Sure, you can save a whopping percent in x amount of minutes, but here’s the real question: Do you have enough coverage?

Auto insurance is required by law (in most states). Your homeowners policy is required by your mortgage lender, and if you’re renting, your landlord may very well require you to have insurance, too. So, you’ll at least have some form of coverage if you ever need to file a claim.

But what about life insurance?

Life insurance is a tax-free cash benefit for your beneficiaries in the event of your death. Your policy helps pay for funeral costs, expenses, and more. The reason a lot of people don’t purchase it is because it’s often a huge pain – sales reps, in-person interviews, and medical exams – who wants to deal with that? However, this is absolutely a must-have if you have a spouse, dependents, assets, or debt.

(Fortunately, Bestow offers low-cost term life insurance policies without the hassle. Get a quote now.)

Resolve to get your finances in tip-top shape. Our guide will help you start 2020 with more bang for your buck.