Get Ready for Your Mid-Year Money Check-Up

  • July 18, 2022
  • By: Greenpath Financial Wellness

Plans made six months ago might not make much sense today, given inflation, uncertain market conditions, financial stress, or any major life events that have taken place.

A mid-year money checkup is a time to look at your financial health and check in with your progress toward goals set at the start of the year. It may seem like time is speeding up and slipping away at the same time – where did January go? On the other hand, it may be a good time to look forward and make plans for the last half of the year.

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Is your money still aligned with the life you want at this point in the year? If not, make adjustments and move forward into the next six months more confidently.

Like the family car, without regular checkups, your financial plans can break down and leave you in a tough spot. Have your circumstances changed? Births, changes in relationship status, deaths, or other life events can affect your household finances and need to be reviewed, accounted for, and considered for end-of-year planning and possible tax implications. We all have financial plans for our families. Keeping a close eye on your money with a financial checkup throughout the year helps reduce financial stress, gives you more confidence, and gets you ready for a future set on a firm foundation. Getting ready for the second half of the year also includes closing any learning gaps in your understanding and getting help when you need it. Do you need to know more about credit or get reliable debt management advice? Now is the time to take a look and address any adjustments required.

A financial check-up is a good money tool and a perfect time to reflect and adapt as needed. As world and life circumstances change, consider running through this checklist of items to review where you are at the midyear mark.

5 Part Money Check-Up

  • Check-in with your financial plans
  • Review your budget
  • Review your savings
  • Take stock of your debt
  • Look at your credit report

If you have questions, contact a GreenPath financial expert for answers.

If you have questions, contact a GreenPath financial expert for answers.

Check-in with Your Financial Plans

Financially, are you where you thought you would be at this point in the year? How do you feel about your money management skills? A good indicator of your progress is comparing your mid-year status with your initial goals. A lot has taken place globally over the last couple of years. As things begin to move toward a new normal, many people are setting more ambitious financial goals, including aggressively paying down debt, looking at a new home, or a long-awaited family vacation. Of course, there’s nothing wrong with adjusting your plans from the beginning of the year. But, of course, if you haven’t made a financial plan yet, it’s challenging to know where you stand or where you are going. Your mid-year financial checkup keeps you on track with your goals and dreams for the future.

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Review Your Budget

An excellent place to start your check-up is looking at your family budget. If you don’t have one already, this is the perfect time to put one together. If you have created a budget, review where you are now versus where you thought you would be at the beginning of the year. Are you under budget in some areas? Did an unexpected expense come along, causing you to dip into savings or take on additional debt? Did you receive a windfall of unexpected income? Your financial success depends on you regularly taking a realistic look at external and internal factors affecting your financial health.

Budgeting allows you to create a spending plan for your money. Once it is created and followed, it ensures you will have enough money for what you need and the things important to you. Following a budget or spending plan will also put you in a position where you can manage your current debt or give you a road map to work your way out of a situation causing you financial stress.

As you review your budget, you may uncover unnecessary expenses, like excessive shopping, streaming services, phone applications, unused or unnecessary subscriptions, or other recurring hidden fees. To finish the year strong, this is an opportunity to cut the fat out of the year’s budget. During your financial checkup, now is the time to make tough choices about what to keep and what to eliminate at this mid-year point.

A solid budget also includes creating or maintaining an emergency fund. At a time when many have faced sudden job loss and work routine disruptions, it is even more important to have money set aside to handle any financial uncertainties.

Review Your Savings

The other side of reviewing your budget is looking at how much you have saved for current and future expenses. For example, do you know what your expenses are for the next six months? Do you know how much you need in savings? Looking at your standard expenses will give you a good idea of what you typically spend on your priority bills like your rent or mortgage, utilities, food, and basic expenses. Once you know your essential bills for the month, you can put your savings plan in place.

Do you have a clear goal in mind? What are you saving for – a vacation, a new car, or a house? Whatever it is, the more you can save, the better. Make sure your budget and financial plan are in order.

Are you making the most of your savings? Think about your goals and consider contributing as much as you can. Even a small increase in the money you set aside can make a big difference.

How much you should save depends on your particular situation. In general, having three to six months of expenses saved is a goal. However, you could decide to start with a little less or save more – it is just a suggestion. Your savings can help provide peace of mind for the future and prepare you for retirement, a large purchase, educational goals, or unexpected situations. You may also want to set a higher savings target to account for optional household expenses, like vacations, special occasions, or other goals. A good idea to make sure you reach your saving targets is to automate your contributions. Set it up with your financial institution so it comes out of your account regularly, without having to think about it.

Make sure you discuss any mid-year changes you make with your financial professional to stay on course with your overall financial goals. Or reach out to a GreenPath counselor for any money questions you may have.

Make sure you discuss any mid-year changes you make with your financial professional to stay on course with your overall financial goals. Or reach out to a GreenPath counselor for any money questions you may have.

Take Stock of Your Debt

How are you using debt? Are your credit cards maxed out? Do you pay them off, carry a balance, or are you behind on some accounts? Review and create a plan to pay off your debt during your midyear money checkup and get debt management advice when you need it. Reducing financial stress is paramount for anyone dealing with the challenges of a career, family, and other things out of our control.

Most people have debt in one form or another. Your money checkup should also look at your debts and how you handle them. This can include your mortgage, credit cards, loans on automobiles, education, and health care expenses. Each one of your debts is an obligation to pay what you owe each and every month. As you go through this financial checkup and look forward to the second half of the year, take stock of your current debts and try to pay them down. Paying down and ultimately paying off your debts will help with your savings, your financial health, and your ability to save for your future.

Effective money management also includes looking at your credit card use and understanding the advantages and disadvantages of using them. If you use credit cards within your means and pay them off in full monthly, they can be a safe and useful substitute for cash. Using credit cards appropriately also helps establish and maintain your credit history. As with any debt, you need to make sure you use solid money management strategies, so your debt doesn’t get out of control. If you find you have questions and need debt management advice, reach out to GreenPath for a free consultation.

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Look at Your Credit Report

Proactively staying on top of your credit report is an important part of your money checkup. Regularly monitoring your credit can give you a heads up on errors, protect you from fraud, and provide you with important information to strengthen your credit score. It is important to review your credit report to check for any unusual activity. You can access your reports from the three major monitoring companies by visiting the website.

Why is it important to check your credit report? It shows vital information like the number of credit cards and loans you have, whether your bills are paid on time, and if any of your debts have been turned over for collections. Creditors, some employers, and other businesses use your credit to decide if they want to do business with you — and what terms they will offer you. Have you ever wondered how your credit score is calculated?

GreenPath has trained, certified counselors who can walk you through a free review of your credit report. They will take the time to explain how credit scoring works, how to read the report and answer any of your questions. Understanding credit is much easier when you have a trained professional available who can help. Normally, you are entitled to receive one free credit report per year from each of the three credit bureaus – Experian, Equifax, and TransUnion.

However, due to the pandemic, through December 2022, the bureaus are offering access to your credit report each week. While the reports are free, there is a small fee charged to see your actual credit score. Keeping up with what is in your credit report helps reduce financial stress because when it comes to your credit, knowledge is power.

You Are Not Alone

The best first step to taking control of your money is knowing where you are now and where you are going.

Remember that on your money journey, you are not alone. Some people are reluctant to look at their finances honestly. Creating and managing your personal finances is an active process, not something you look at only one time a year and hope everything magically works out.

When it comes to money, small steps go a long way and have a lasting impact. The small step of regularly looking at your finances and making adjustments along the way keeps you on track and can relieve financial stress.

As you look at your money at this mid-year point, remember you are not on this financial journey alone. The spending, credit, and debt management advice you need is just a phone call away through GreenPath Financial Services.