Thursday, November 13, 2008

Year-End Financial Check-Up

Tip #26 - At year end, figure out where you stand with your finances and set your goals and budget for next year. Over at Money Saving Mom they are doing a year-end financial check up to see if they met their goals for 2008. This is a great idea. At least once a year and even better twice, you should check on your finances. See how you are doing. See what the balance is in each of your accounts - both savings and checking. Move things around if you must to get you back on track where you want to be. And at the end of the year, set financial goals for next year. Figure out how much you want to save or how much debt you will pay off. And set your budget so you can do these things. You can't save money if you don't know where you stand. Since it's November, it's a great time to get started for next year. Write out your expenses, prepare a budget, and set your goals for 2009. Time to get started!

In Real Life (IRL) - We have a budget set for each year and I know how much I want to save for the upcoming year. Each year for the past few years, our financial goals have been the same - save $2000 in each of our children's college funds and the maximum amount in our Roth IRAs (this year it is $5000 each). We also save 10% of my husband's income in a 401K. Beyond that nothing gets saved because the rest of my husband's income goes toward our budget - our mortgage, food, utilities, etc. I make a small income at home selling things on ebay. That money generally covers the cost of preschool and dance and piano classes. As my children get older I will probably get a part-time job that will cover higher expenses that we can expect as children get older such as braces and summer camps. We'll see how it goes. We'll sit down and do a formal budget later in the year.

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