Last Updated: January 1, 2008
If you've made a New Year's resolution to keep better track of your finances in 2008, here's a list of important planning and execution tasks that should be on your financial calendar for the year:
- Set your credit report dates: You are entitled to one free credit report a year from each of the three credit reporting agencies: Transamerica, Experian and Equifax. Each year, you should check each of your credit reports from AnnualCreditReport.com. It's wise to stagger the dates you check each report because irregularities might surface at different times of the year and you'll catch them faster.
- Think about college aid: On January 1, kids and parents are free to start working on the Free Application for Federal Student Aid (FAFSA) for the upcoming school year (2008/09). To meet deadlines in most states, you should submit your FAFSA no later than March 1, with February 15 being the optimal date.
- Start or review your emergency fund: Experts believe you should have three to six months worth of living expenses set aside. Set a fixed amount you'll save each month toward that goal.
- Check your investment accounts on your brokerage firm's or mutual fund companies' Web sites and print off the December 31 statements for the previous year. Review the earnings paid out to your account from interest, dividends, and both short-term and long-term capital gains. Review the capital gains and/or losses you realized from the sale of mutual funds, stocks and/or bonds. Use this information to begin planning for your 2007 taxes.
- Review your checking account statements and credit card statements for the previous year and tallying your spending/expenses into categories. Compare your cash outflow to your cash inflow for each month of the previous year and set target goals for spending in each category for the New Year based on your financial goals and values.
- If possible, fund your IRA contributions as soon as possible in the New Year. You'll maximize your returns over the longest time possible.
- If you have a health savings account or a flexible spending plan through your employer, total the amount of expenses filed during the previous year and compare them to the total amount you contributed. Make sure you aren't contributing more than you are being reimbursed, especially if you lose any excess contributions.
- Start pulling your tax information together: Your W2s and 1099s should be arriving — get your records ready to start your return.
- Get ready to fund your IRAs: April 15 will be 2008's tax deadline, and that's the last date to make a tax-deductible contribution to your IRA. Plan to make the biggest affordable contribution you're allowed.
- Deadline to apply for spring 2008 Stafford and PLUS Federal Direct Loans: March 1.
- Tax deadline: Midnight, April 15 is the deadline for federal and state taxes.
- Education account contribution deadline: Don't forget that contributions to Coverdell accounts for the previous year are due on tax day.
- Check your insurance coverage: If you have sufficient emergency funds, check to see if a higher deductible on home and auto insurance makes sense in terms of premiums savings and fewer potential claims.
- Deadline to apply for summer 2008 Stafford and PLUS Federal Direct Loans: April 16 is the deadline.
- Talk to your parents: If you've never discussed estate, health and long-term care planning with your parents, do it now.
- Do an energy checkup: Have your furnace and air conditioners checked to make sure they're working properly during the heating and cooling season.
- Do a mid-year financial checkup: Take the time to do a review of your tax planning, retirement savings, home, health and life insurance needs and do a mid-year check of your spending and emergency fund levels.
- Pell Grant Application deadline for 2007-08: June 30.
- Do a beneficiary check: Is the beneficiary information on all your investments, insurance policies and bank accounts up to date?
- Check your will: If you haven't checked your will in five years, see if your instructions are current. Make sure your powers of attorney reflect your intentions.
- Go over money issues with your college student: Whether they're freshmen or seniors, take some time to go over financial details with your student.
- Order your last credit report: Get your third and final credit report of the year.
- Be ready for open enrollment: Many companies set open enrollment for their benefits plans in September and October. Make sure you've done some thinking about your benefit choices for the coming year.
- Tax extension deadline: If you had to file for an extension on your federal taxes this year, your final deadline to file is October 15.
- Total your potential tax losses: Confer with your tax adviser to see if it makes sense to sell stocks before the end of the year to balance out capital gains or losses in your portfolio or to carry forward losses for future use. Plan mutual fund sales before dividend distributions for less tax impact.
- Spend out your flexible savings account money: Check your employer's rules, but you should spend out the amount you put in your flexible spending account by December 31 or the end of the plan year. Schedule any procedures or medical expenses you'll have by then.
- Give: Make the charitable deductions you want to give for the end of the tax year. Also, remember you can make financial gifts of up to $12,000.
- Pay deducible expenses early: To lessen your tax impact for the current year, pay mortgage interest or property tax installments early if your tax situation would benefit from it. See if alternating using standard deduction one year and itemizing the next — called "doubling up" — works for you.
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