The New Year 2017 is here. Amidst excitedly planning what all you want to do this year to make it more awesome than the year gone by, you must have spared a thought for your finances as well and wondered where all your money went last year. But instead of pondering over what’s already done, New Year is the time to quickly complete some financial duties and take steps to make sure that you plan your finances better this year. Here are certain steps you can take to manage your finances more prudently in 2017.
- Review insurance- The changes that happen to your life over a year might affect your insurance needs as well. There might be a new and more beneficial policy in the market or you might feel the need to increase your insurance cover. Therefore, it is advisable to review your insurance at the start of the year, whether life, health, home or car, and make changes in your insurance portfolio as needed. Didn't make a Health Insurance claim this year? Worry not, you haven't lost your money!
- Meet your financial advisor- Start of the year is also the start of the last quarter of the financial year. Therefore, you must meet your financial advisor for planning your taxes, be it your personal accountant or anybody else from whom you take financial advice. Start investing now, as per his or her advice, so that you don’t end up investing hastily in mid-March. Financial planning for dummies: a 7 step guide
- Review portfolio- The share market goes through a lot of ups and downs during the year and it goes without saying that it affects the returns on your investments too. Therefore, you must evaluate your investments across all categories- whether individual shares, mutual funds, etc. to make sure all your assets are in sync with your financial goals and none is getting you losses. Investment options- thinking beyond the obvious
- Be philanthropic- It is the start of a new year. It’s time to not just work towards your new dreams, but also help others who are not in a position to fulfil their needs. Therefore, donate some money to a charity. Also, donations are tax deductible under section 80 G of the income tax act.
- Establish/ review emergency funds- Start of the year is the right time to do something very important- establishing an Emergency Fund for you and your family. Financial experts usually recommend to set up an emergency fund that can cover between three to six months of your expenses. Keep this money liquid so that it is easily available whenever you need it. If you already have a fund, then review it and add more if required.
- Change passwords- You need to change your passwords, like your net banking passwords, your e-filling password etc., regularly. So, if you haven’t done that in a long time, it is better you do it at the beginning of the year. This step is very crucial to maintain security of your transactions online and keep your money safe from the various cyber thefts that take place these days.
- Clear clutter- There are a lot of things that you might not need anymore. These could be books, old clothes, old furniture or any other thing that is of no more use to you. It is time to clear that clutter from your home and workplace. It will not just make your place look neater but will also get you extra money for some shopping. Also, list down all the paid services you have subscribed to and discontinue the ones you no longer use.
- Identify your financial requirements- You will have a broad idea of your major intended purchases, like car, television etc. Also, if you have any other major events coming up, like a child’s school admission or buying a new house, you will know beforehand. Identifying these financial requirements is imperative because you will need to figure out how you will fund these expenses.
- Set a budget- To be able to meet your financial requirements for the year, you must set a budget for 2017. This budget should include all your monthly needs and also your goals for the year, be it going on a holiday or buying any electronic device. While you set your annual budget, make sure to include any debts that you need to pay off. 10 hacks that can save money in day to day life
- Examine your expenses from 2016- Before you start making a budget for 2017, you must go through your credit card and bank statement from the previous year and examine your expenses. You must analyse where did you overspend and cut them down in your budget for 2017.
In order to work towards making your 2017 amazing, you need to make sure that you have finished all your financial obligations of the year 2016. The ten To Do’s mentioned above not just help your review your finances from 2016, but also let you manage your finances better this year.