4 items for your mid-year money checklist |  Personal finances

Lauren Schwahn

A lot can happen in six months. That’s why, as we close out the first half of the year, it makes sense to look at your financial life.

“With inflation, I think people are getting heavier this year than they probably have been in many years up to this point,” says Jason Dall’Acqua, a certified financial planner and founder of Crest Wealth Advisors in Annapolis, Maryland. “So this is a good time to see how things went … as well as to plan for what lies ahead for the rest of the year.”

So where do you start? Add these four items to your mid-year money checklist.

1. Review your income, expenses and goals

You do not have to pick up every penny you have made and spent in the last six months. But taking a few minutes to check out a banking or budget program can help you better understand your finances and be course-correct if necessary.

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“At the moment with inflation, even if you had a budget in January, it is probably not the same as today. There are a few things that are going to need to be changed. So it’s just real to step back and find out where you stand today versus where you thought you were going to stand today, ”says Kayla Welte, a CFP with District Capital Management who lives in Denver.

Look for opportunities to scale back if you spent more than you expected. For example, you can eat less or cancel subscription services that you rarely use. “Any excess spending you’ve made may have to be cut to account for these higher costs of things you absolutely have to buy,” says Welte.

If you set money decisions or other financial goals earlier this year, look at them as well. Have you saved as much for retirement or an emergency fund as you planned? Are you on track to pay off debt?

2. Deal with debt

Debt is becoming more expensive to bear due to rising interest rates. Pay off debt faster, especially those with variable interest rates, to save money. This debt can include credit cards, personal loans or adjustable rate mortgages.

Concentrate first on reducing your highest rate debt, then move on to the next highest. Dall’Acqua also proposes to switch from variable to fixed rate options through refinancing, if possible. “If you can include the fixed rate now, you’ll probably save yourself significantly in interest costs over time,” he says.

Be aware of end dates for loans in tolerance. For example, federal student loan payments will resume on September 1, except for another extension.

“At this point, they’re on break for almost two years,” Dall’Acqua says. “So if that money got lost inside [people’s] overall spending, it’s going to be a big shock when they have to pay again. ”

Setting aside money now in a separate savings fund can help mitigate the blow.

3. Plan holiday shopping

Inflation could make holiday gifts a little more expensive this year. Create a shopping list and think about how much you can afford to spend. “Find out what it will take for you to start saving on a weekly or monthly basis and start setting that money aside now,” says Dall’Acqua.

Starting shopping early can also help you manage costs without building up debt. Many retailers offer great sales opportunities in the summer, so you will get discounts shortly before Black Friday. Amazon’s Prime Day comes in July. So is the Nordstrom birthday sale.

4. Examine your taxes and benefits

Welte recommends using an online tax calculator to see if you are holding back too much or too little. It can help you avoid being hit unexpectedly with a large tax bill or missing out on extra cash you may need right now.

“If you’re doing the calculations and you’re going to get a $ 6,000 tax refund, it’s a good time to change your W-4s, now get more money in your pocket to pay for these excess costs associated with inflation. come forward rather than wait until next April to get that refund, ”says Welte.

If you need to make adjustments, fill out a new Form W-4 (you can find it on the IRS website) and submit it to your employer.

While you are busy, evaluate your employee benefit choices. These benefits can include health insurance, life insurance, health savings accounts and flexible spending accounts, plus fringe benefits like gym membership.

If you review your choices in the summer, you may be overwhelmed in October and November, when open listings start for most companies, says Joe Bautista, a CFP in Lake Oswego, Oregon.

The goal is to ensure that you choose the most cost-effective options that suit your needs. For example, “A PPO has higher premiums, but a lower cost if you tend to use health care, lower deductibles and co-payments typically. But if someone does not use that health care, they can overspend,” says Bautista.

Do not worry about getting everything perfect now. As Bautista says, “financial planning is dynamic, it’s not static.” Check your money plans regularly and work up as needed.

This article was written by NerdWallet and was originally published by The Associated Press.

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