Summer is a natural halfway point between New Year's financial resolutions and year-end tax planning; it's also a convenient time to contact financial experts, tax planners, human resources representatives and other advisors—who are less busy during their “off-season.” Here’s what to look for:
Taxes. By summer, you should have a decent idea of what's going on with your tax situation so it's time to finalized this year's planning. Are there any major life changes since last year to include in your tax strategy? This will mean a transition in your tax situation. If you earned a nice tax refund in April or paid a large tax bill, you should ask for a W-4 from your employer and adjust your withholding. Time to make sure you're maxing out workplace tax benefits—like your flexible spending accounts and retirement contributions.
Insurance. Use the summer to determine if your insurance plans are meeting your needs. Many employers have an open enrollment for health insurance and other benefits in late fall, so now’s the time to think about this.
Estate Planning. If you don't yet have an estate plan in place, speak with an experienced estate planning attorney. Don’t be one of the 64% of Americans that don't have an estate plan in place. Get the basics prepared, especially a durable power of attorney and advance medical directives.
Emergency Fund. Check on your emergency fund and see if it was depleted by a summer vacation or another event like a change of jobs. You should keep three to six months' worth of living expenses readily available. Build your rainy day fund by putting a percentage of your paycheck into savings every month. If you don't see that money available in your checking account, you won't miss it.
The Long Term. Summer vacation is also a great time to look ahead and consider where you'd like to see yourself in the future. Get started with financial strategies that will help you reach those goals.
Reference: US News (July 28, 2016) “Keep Your Money Goals on Track with a Midyear Financial Checkup”