Financial wellness checklist

Most of you (hopefully) accept the annual dental check as a mildly unpleasant but necessary part of life. Are you as diligent when it comes your money? An annual financial check-up is a must if you want care about financial wellness - no needles or fillers involved!

Here’s a check-up checklist we’ve put together for you (you’re welcome):

  1. Get organised. Collect all your financial records in one place. Use spreadsheets, iPhone apps or traditional notes - whatever works, as long as you stay organised.
  2. Assess your investments. Calculate the return on each of your stocks, bonds or mutual funds. Are you happy with how they’re performing? If not, it may be time to recalibrate your investment portfolio.
  3. Analyze your budget. Personally, we’re fond of the 50/20/30 budgeting rule. Reassess how you’re keeping to the allocated percentages and take a note of any adjustments you need to make. And remember, don’t confuse “wants” for “must-haves”. You may feel like you need to get a new coat this season, but be honest - do you really?
  4. Optimize your taxes. It’s always a good idea to plan ahead for the year’s taxes. Is there anything you do to minimize them? If you have a partner, you should make the most of joint ownerships. If you are self-employed, remember to claim your allowances. You can also consider tax-efficient investments, like the enterprise investment scheme (EIS).
  5. Review your debts. How are you doing on controlling and paying down debt? Evaluate your debt to income ratio
  6. Evaluate your emergency and retirement funds. Alarmingly, only four in ten adults have less than £500 in savings. As a general rule, you should have 6 months’ worth of salary set aside for an emergency fund. Similarly, you should be aware of how much you’re contributing to your retirement. If these funds look depleted, think of ways you can boost them.
  7. Know your credit score and net worth. Net worth is the difference between what you own and what you owe. Knowing your net worth forces you to understand the reality of where you stand financially. Your credit score is another important ‘reality check’ - the higher your credit score, the better your chances of securing a loan, mortgage or even just a phone contract.
  8. Don’t forget about your life insurance and will. Nobody likes thinking about this gruesome twosome, but it’s crucial you don’t neglect your life insurance and will - especially if you have dependents. Your life’s circumstances may change year to year, which should be reflected in your will and life insurance plan. You can read more about both in our previous newsletters here and here.
  9. Be honest and seek advice. You may remember what we wrote in our previous newsletter about the value of speaking to a financial adviser. If upon completing your annual financial check-up you find yourself feeling disappointed - don’t be afraid to seek professional advice.

Credit: Giphy.