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  • Writer's pictureBrian Traverso, ChFC, AIF, CPFA, AWMA, EA

Financial Spring Cleaning

We are right in the middle of spring which means spring cleaning might be underway for you. Nothing beats the feeling of clean laundry and cleared countertops in the kitchen and bathroom. Just as you might clean out your closets and purge your kitchen pantry, channel Marie Kondo for your finances too. Addressing the financial elephant in the room could make room for new financial growth and goals as well as strengthen your current plan. Make time to go through all aspects of your financial life and find those pesky items that don’t “spark joy.” Here are a few ideas to help you get started:

1. Clear the Clutter

You might be one of many individuals who have a collection of gift cards from 2005 that need to be used up—dollars just sitting there that need a final resting place. Sadly, there is nothing that can be done with the cards from Blockbuster or Mervyns, but you might consider making a date with friends or family to put those other cards to use.

Alternatively, there are sites like Raise or Cardpool that will buy your unused gift cards for a nominal fee.

Speaking of nominal fees, are you a gym “donor?” Review memberships and subscriptions (namely, online subscriptions) that you aren’t using or that aren’t giving you the same benefits as when you first signed up and consider cancelling. Do you really need cable TV? Maybe one online streaming service (as opposed to several) will suit you better and save you money. The same thing can be done with bank accounts that need consolidation and credit cards you aren’t using. Retail store credit cards are notoriously enticing and after getting 15% off could end up hiding in the back of your financial closet. Look through your monthly statements and identify those charges that have long gone overlooked, then reroute those dollars into a child’s college fund, your retirement account, or some other financial goal.

In an age where there’s an app for everything, consider going paperless with bank, credit card, and brokerage statements and look into paying bills online. Develop a method to organize your filing system to keep from paper piling up in your home office. Generally, shred bank and credit card statements after you’ve checked those for accuracy. Most banks will archive statements online for you. Tax returns and other real estate documents keep for seven years in a secure location.

Fortunately, our clients have access to highly secure digital document storage as part of our platform!

2. Review

After you have cleared the clutter, take a look at other areas that need review. There are three areas that I want to highlight. First, no one will protest to the importance of keeping your car and home secure. However, as we come to rely more on cloud-based computing, protecting personal information online needs to be a priority. If you’ve had the same email password since AOL and the PIN for your debit card is the year you were born, I strongly suggest a change. Create strong passwords that are a combination of letters, numbers, and symbols. Not surprisingly, there are a number of apps you can use for this.

Second, maintaining good credit can make a huge difference when looking to refinance your house or purchase your dream car. Routinely check your credit report to make sure your credit is in good standing and to ensure no errors are present. Each of the three credit reporting agencies (Transunion, Experian, Equifax) is required by law to furnish you with a report every 12 months. This government website will give you access to a free report. ( Be sure to report any inaccuracies immediately.

Third, take a look at those financial accounts where assets don’t pass through your will. These could include bank accounts or insurance policies where named beneficiaries are direct recipients of the assets. Look at each of your financial accounts to make sure the proper beneficiaries are in place. If you have a will or trust, make sure your assets are going where you need them to. Life changes like marriage, divorce, or having children require these types of amendments. Further, let us know if you do not have a trust or will and aren’t sure if you need one. This is an area that is often overlooked and good review can benefit you in the long run.

3. Adjust

Now that we have cleared the clutter and reviewed what is left, the last step is to ensure you are on track for meeting your financial needs both in the short term and long term. As we approach the middle of the year now is a great time to look at your progress with retirement savings. For 2019, the annual contribution limits for a Traditional & Roth IRA is $6,000 if you’re under age 50, and $7,000 if you’re over age 50. If you participate in a retirement plan sponsored by your employer (like a 401(k) or SIMPLE IRA) make sure you’re fully taking advantage of any matching contributions. If you own a business, there are great opportunities when it comes to saving for retirement that are too many to mention here. Make sure you have a plan in place and know that we can help!

While you’re looking at your pay benefits at work, make sure your tax withholdings are set up appropriately. We can help you calculate your withholdings or you can visit the IRS' calculator by clicking here. This could be really helpful when reviewing your taxes for 2019.

Lastly, I should mention insurance coverage. Insurance is simply a tool in the event you were to experience a loss and sadly, these circumstances come without notice.

It might be time to review your life insurance policy and make sure you have sufficient coverage to protect yourself and loved ones.

Again, life events including having children or receiving a significant salary raise could require you to make changes to better align with your current situation.

These starting points will help you clear away financial clutter, review items that maybe you haven’t looked at in a while and remind you to keep your main priorities in focus––to help “spark joy.” As always, BOLT Wealth Management is here to answer questions and guide your decision-making to help meet your financial goals.

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