Meet our writers

 







Money December 2012

Dollar Sense

Hit the Ground Running in 2013 by Slowing Down: Update!

By Teresa Ambord

Make sure all of your insurance policies are easy to locate if a disaster – such as a flood or fire – occurred. The time you have to file a claim may be limited. Even if you know exactly where your papers are, someone else needs to know in case you cannot be consulted.

Most of us think of the new year as a time for a fresh start. We’re going to get in shape, eat better and clean out the garage. Before you buy the new jogging suit and toss out the Ding Dongs in favor of celery sticks, resolve to be wealthier in 2013. How do you do that? First, slow down. Slow down and take a good, honest look at where your finances are and where they are headed. Here are several areas to take a look at and consider what changes you need to make.

    1. What’s on your calendar for the year? Do you generally owe taxes in April? Planning to travel to your grandson’s graduation in June? Attend a wedding in August? Is it your turn to host the extended family at Thanksgiving? Those things cost money. Create an overall budget that can have you financially ready for each event so you’re not overwhelmed, or tempted to use high-cost financing like credit cards at the last minute. When you pencil in what you think you’ll need to cover those events, don’t forget to plan for cost increases. Also put away something for major expenses that you know are pending, like replacing the roof.

 

    1. What’s not on your calendar? Now that you’ve thought about those expenses you have planned, give some consideration to those inevitable unplanned expenses. The water heater that goes out, your adult child that asks to borrow money for new tires, the doctor bill that wasn’t covered by insurance. You may be thinking that this is why you have credit cards, for times like these. Saving your credit card use for emergencies is a good idea. But if you can manage it, putting aside a few dollars into a cash reserve each month may allow you to avoid the unforgiving high cost of debt financing.

 

    1. Where are your important papers? Make sure all of your insurance policies are easy to locate if a disaster – such as a flood or fire – occurred. The time you have to file a claim may be limited. Even if you know exactly where your papers are, someone else needs to know in case you cannot be consulted.

      Do you have warranties on major items? The majority of extended warranties are never used because the policyholders cannot lay their hands on the papers when they need them.

      If you should lose your wallet or if you find you are the victim of identity theft, can you quickly determine who to contact? Keep a list of contact information for canceling credit cards and notifying your bank if necessary.

 

    1. Are there expenses you can easily cut? It’s a good idea to review your recurring expenses now and then. We tend to make our arrangements – for items like cable TV, phone service, insurance etc. – and then forget about them. It couldn’t hurt to take a look. For example, how much have you really watched the premium movie channels you signed up for last year? If you’re not watching them enough to make them worthwhile, find out if you can save money by eliminating them. On the other hand, you may be able to bundle services and save money. It’s worth a look.

      Phone service providers are in stiff competition. Can you get a better deal than you’ve got now? If you need to cut costs, consider getting a phone that is… just a phone. Or better still, a prepaid phone that makes controlling costs easier.

 

    1. Is what you have too much, too big, too troublesome? If your house is stuffed full of items you don’t use, now is a good time to give away or sell what you don’t need. Why keep items that just need to be dusted? You might even consider downsizing your car and/or your house. Your car may be a gas hog. Your house may be an insurance and utility hog. Not to mention a bigger house requires more cleaning.

 

    1. What’s in your portfolio? Don’t let the onslaught of bad news in the stock market make you bury your head in the sand. The people who do that are the ones at greatest risk, according to financial experts. Are the decisions you made last year still working for this stage in your life? Financial advisers can help, but there is also a lot of free help online.

 

    1. Is your will up to date? Families change due to births, deaths, marriages, divorces. It is very common to forget to adjust your will for those changes, and the results can be harsh. If you haven’t already done so, let family members in on the arrangements you’ve made for yourself in terms of “last wishes,” and plans such as the purchase of a burial plot.

 

  1. Are you giving money to causes close to your heart? The economy has hit charities incredibly hard as donations have fallen off. If you are in the habit of making end-of-year gifts, you might consider switching to a plan of making 12 equal contributions throughout the year.

 

Teresa Ambord is a former accountant and Enrolled Agent with the IRS. Now she writes full time from her home, mostly for business, and about family when the inspiration strikes.

Meet Teresa