Spring Clean Your Finances: A Comprehensive Financial Health Checklist for a Prosperous Future

As the flowers bloom and the days grow longer, spring serves as the perfect reminder that it’s time to refresh and rejuvenate. While you’re decluttering your home and tidying up your garden, don’t forget to give your finances a thorough spring cleaning as well. Just like your living space, your financial health requires attention and maintenance.

To help you get started, we’ll guide you through a comprehensive financial health checklist so you can make this year your financially strongest one yet.

Dust off Your Budget:

Start your financial spring cleaning by revisiting your budget. Assess your income, expenses, and savings goals. Update any changes in your financial situation, such as salary adjustments, new expenses, or additional income sources. A well-maintained budget serves as the foundation for a healthy financial future.

Check Your Emergency Fund:

Your emergency fund is your financial safety net. Confirm that it covers three to six months' worth of living expenses. If it falls short, redirect some funds from your budget to fortify this crucial buffer. An adequate emergency fund protects you from unexpected expenses or job loss, providing peace of mind in turbulent times.

Shred Unnecessary Debt:

Consider your outstanding debts and create a plan to tackle them. Prioritize high-interest debts like credit cards and personal loans. Devise a repayment strategy, whether it's the snowball method (paying off smaller debts first) or the avalanche method (tackling high-interest debts first). Reducing debt not only relieves financial stress but also frees up funds for other important goals.

Review and Renew Financial Goals:

Spring is a time for renewal, and your financial goals should be no exception. Review your short-term and long-term objectives. Are they still relevant? Have there been any major life changes that necessitate adjustments? Whether it's saving for a vacation or planning for retirement, make sure your goals reflect your current aspirations.

Get ahead of your taxes:

We know taxes are something you only want to think about once a year, but preparing for tax season is one of the best ways to ensure you’re taking advantage of every tax opportunity. Here are some things to think about:

• Are your tax withholdings right for you?
• Are your retirement plan contributions aligned with your long-term goals?
• Do you have access to a Health Savings Account (HSA)?
• Are your donations to charitable organizations tax efficient?

Optimize Insurance Coverage:

Your insurance needs may change over time due to life events such as marriage, the birth of a child, or a change in employment. The right amount and type of insurance are crucial to adequately protect you and your family. Here are a few areas you should focus on to ensure they still meet your needs:

• Life Insurance – A life insurance policy protects your family’s financial future. A new life event, such as a change in marital status, taking out or paying off a  mortgage, receiving a significant raise, or retiring, can change your life insurance needs.
• Short- and Long-Term Disability – One of your most important assets is your ability to work and earn an income. But what happens if you lose your ability to work? Disability insurance can give you income if you become temporarily or permanently disabled.
• Homeowners Insurance – Newly acquired valuables, renovations, additions, and even new pets can all affect your home insurance needs.
• Employee Benefits – These benefits can be valuable, and it is important to know your options. Take the time to review all your benefits, such as medical, dental, retirement plan contributions, life and disability insurance, stock options, and more.

Review and Rebalance Investments:

Ensure your investment portfolio aligns with your risk tolerance, financial goals, and time horizon. Rebalance, if necessary, to maintain a diversified and well-aligned investment strategy. Consider consulting with your team at Woodward to make informed decisions based on your individual circumstances.

Update Estate Planning Documents:

Estate planning is often overlooked but is a critical aspect of financial health. Review and update your will, power of attorney, and other relevant documents. Ensure that your beneficiaries reflect your current wishes. Your Woodward team is here to help.

Check Credit Reports:

Your credit score plays a crucial role in your financial health. Request a free credit report at here.  Addressing errors promptly can positively impact your credit score and financial standing.

Remember that a well-organized financial life contributes to peace of mind and sets the stage for future success. So, grab your financial broom and dustpan – it's time to sweep away the cobwebs and welcome a season of financial renewal. If you would like to learn more about steps you can take to clean up your finances, please reach out to us to continue the conversation.