When the ball dropped marking the beginning of 2014, many resolutions were made. Some pledged to exercise more or eat healthier and others to grow their businesses, get out of debt or add to their savings to help secure a comfortable future for themselves and their families.
The key to resolutions of all sorts is follow-through. In the case of achieving life, business and financial goals, it begins with planning and taking those first crucial steps in the right direction.
People who say they’re going to get to the gym more know a good path to success is getting a trainer to keep them honest, and this strategy holds true for finances as well. Your financial representative is your go-to person to help keep you on track. He or she can help you assess your current financial situation and help you make any adjustments needed based on your current situation and goals, as they may change year to year.
Perhaps you are at a point where your children are ready to go to college, or you are nearing your retirement and want to be sure you have a game plan in place to help make good choices for the future. A financial representative can go through options to help you make informed choices.
A good way to get started is to collect all your financial data, including all your income, assets and expenses. It can be as simple as drawing up a few lists, or you can begin entering them into a more formal budget tool. You can use online calculators or the federal government’s MyMoney.gov website, which has budget templates and other tools to get you organized. But if you aren’t a technology wizard, don’t let that stall you—a simple list is all you really need to get started. The important thing is to try to be as comprehensive as possible so you can get a full picture of where you are financially.
When listing expenses, include your monthly obligations and discretionary spending as well as financial commitments like insurance payments, gym membership and professional expenses. Add in payments for any credit card debts or loans. Don’t forget things like hobbies, holiday spending, travel expenses or tax obligations.
When listing your income and assets, remember to include those other than what you earn from your work income: Are you collecting interest or dividends in certain accounts? Do you have IRAs, CDs, stocks or bonds, or old 401(k)s from previous jobs? Traditional savings accounts? Healthcare savings accounts? Emergency savings? Do you have any inheritance income? Income from property rentals? What kind of insurance plans do you have? Do you have savings or additional income of other kinds to be considered?
Gather the most current statements for all your accounts: banking, savings, retirement, credit cards, loans, insurance plans and mortgages. You can go online and download your most recent statements, or call the institutions to get updated statements sent to you. Also get a copy of your most recent tax return.
While you are doing this, take an extra few minutes to be sure your personal information is up to date with each of your financial vendors. Check that your current address, phone number, passwords and email are on file. You should also double-check that your beneficiaries are up to date, and ask if there are any new online services that would be more convenient for you to access your accounts.
The next step is part of the bonus of doing all this work—you get to think about your future and your goals. The whole purpose of this is to get you where you want to go, so take some time and write out your short-term life and financial needs, as well as your long-term goals. Do you want to pay off debts? Are you ready to have a family? Thinking about going back to school? Preparing to retire? Want to invest in property?
Once you’ve laid out your goals, a financial representative can work with you to determine how you can get there. Getting to that end goal requires taking the first few steps but is a resolution you’ll be glad you kept.