Everybody talks about Spring Cleaning…but what about Fall Cleaning? Nobody talks about Fall Cleaning.
Well, when it comes to your finances, I think fall is the best time to dive in and clean things up. Why? Because in the Fall you can check-in on your plan since you last were forced to look at your money (i.e. tax time) and you can see how you’re setting yourself up for the end of the year. It’s also a great time to course correct things if you need to, and for many people, September and October are usually slower times in life in general.
So, if you’re going to organize your finances for fall, what do you need to check? Take a look at our list below to setup a fall cleaning for your finances.
The first step in cleaning up your finances is checking in on your financial organization. I follow our guide to completely organize your financial life. However, I still fall off when it comes to filing and organization. That’s why it’s great to setup breaks during the year to make sure you get caught up on filing and ensuring that everything you need to keep has a place.
It’s also a great time to look at all your accounts and make sure there are no surprises. I recommend that no matter what, you spend a few minutes and review your banking and investment accounts – make sure everything is what it should be, and you are comfortable with where you stand.
Given that there are still three months left in the year, it’s also a great time to look at your retirement contributions and make sure that you’re still on track to make your goals. If you’re trying to max out your 401k, you can look at how many paychecks you have remaining and make sure that you will be contributing enough. Given that you can only contribute percentages of your paycheck, it makes it nearly impossible to get the exact amount into your 401k. You sometimes have to tinker with your paycheck deductions to make sure you’re contributing enough, but not too much.
Remember, if you contribute too much, too early, you might not get the most of your employer’s matching contribution.
Finally, the fall is a great time to re-evaluate your insurance for two reasons – first, September is Life Insurance Awareness Month, and second, the timing works well for many families. Timing is huge – by this point in the year, most major life changes that are planned for have happened or you know they will occur. These include marriages, babies, new jobs, and more. It’s also just ahead of the time that most people start making decisions for open enrollment and can decide their benefits at their employer.
Given that the majority of American’s who have life insurance get it from their employer, it’s a great time to decide on whether the amount your employer provides is enough to cover your family’s needs. Many financial planners advocate having 20x your annual salary in life insurance, yet most employers typically only offer 1x to 5x your annual salary. That leaves a gap in potential coverage should anything happen.
Plus, according to a recent survey by John Hancock, 47% of Gen Xers can pinpoint the family benefits of having enough life insurance to cover their family’s needs.
If you’re coming up short in what your employer provides, you can look to private insurance companies for a policy that can cover that difference. Companies like John Hancock offer competitive plans for young adults and families, especially those that live healthy lifestyles. For example, John Hancock has their Vitality product, which rewards participants with perks such as savings on their premiums by engaging in healthy activities.
Finally, along the same lines as life insurance and open enrollment, it’s also important to look at your health insurance for open enrollment. With the rise of Health Spending Accounts, high-deductible insurance, and big changes to employer plans, you need to spend a little bit of time really analyzing your health spending, and see if you have the potential opportunity to save, or even if you need to make an extra doctor’s appointment before the end of the year.
First, if you currently have a Flex Spending Account, make sure that you’re on track to spend everything you need to by year end. If you need to make an extra appointment, now’s the time to do so. Make sure that you don’t let any of that money go to waste.
Second, it’s also a good time to review your spending and look at your potential spending for next year. Open enrollment is typically when you have to decide on how much to contribute to your accounts, so analyze your spending and plan accordingly.
What other areas do you need to look at for fall cleaning for your finances?
I received compensation in exchange for writing this review. Although this post is sponsored, all opinions are my own.
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page, or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.