By Christine Opheim, President, Financial Advisor
ROC Financial Services, Inc.
rocfs.com
Even if you recently took a look at your finances in preparation for tax season there may still be some items that could use attention. The following list touches on some areas to include as part of a sound financial plan, which should include much more than just your investment portfolio.
Credit cards
Recent legislation caused credit card companies to make changes to their terms and conditions resulting in some increases in interest rates and decreases in credit limits on consumer credit cards. In addition, some card companies have begun to charge additional transaction fees and service charges. These changes can add up to real money, so you should be aware and review your credit statements regularly.
If you discover that you’re not happy with the terms of your credit cards, be wary of hastily closing accounts as this could impact your credit score. In some instances, you may be able to negotiate better terms. Check with your provider to find out your options.
Bank fees and services
Banks have new rules limiting what they can charge for certain services (e.g., overdraft protection and transaction fees). As a result, many have instituted new charges or increased others. Similar to credit card companies, you must be notified of changes prior to enactment, but if you are like many people, these notices can be overlooked. Review every account, even if they all reside with the same bank. The terms can vary from institution to institution and from account to account within the same institution.
In addition, many people do not balance their checkbook on a regular basis, or even record their daily transactions. It is highly recommended that you review and reconcile your accounts at least monthly to stay on track with expenses, minimize costly errors, and potentially eliminate fraud, which is becoming more and more prevalent.
Credit report and score
Building and maintaining a good credit rating can impact your finances in many ways. For example, your credit score can affect the interest rate you pay for loans and credit cards, your insurance rates, and even evaluation for new employment or renting a home. As a result, it is recommended to check your credit report at least annually for accuracy and fraud. Fortunately, this is easy, and you are entitled to one free annual report from each of the three major credit reporting agencies—Equifax, Transunion, and Experian.
Emergency fund
If you don’t have one already, starting an emergency fund, or savings account, should be first on your to-do list. Recommendations vary, but ultimately the amount to keep in your savings is personal and depends on factors such as family size, current debt, and insurance coverage. For further guidance, discuss the amount and how to invest your savings with your financial professional.
Investments
Finally, the cornerstone to a sound financial plan is to review your investment accounts regularly. This includes reviewing your insurance policies, annuity contracts, retirement plans, and educational savings accounts. Are you on track to achieve your goals? Discuss your investment allocation, risk tolerance, and objectives, including all accounts and assets, with your financial professional.
Accomplishing the tasks on this list may take some time initially, but going through the process will be a great start to a sound financial foundation, and could save you some real green! You’ll feel relieved knowing that you’ve taken some important steps to secure your economic future.
Christine Opheim is a Financial Advisor practicing at 8180 N. Scottsdale Road., Suite D203, Scottsdale, AZ 85258. She offers Securities and Advisory Services as a Registered Representative and an Investment Advisor Representative of Commonwealth Financial Network®, a member firm of FINRA/SIPC and a Registered Investment Adviser. She can be reached at 480.283.9544 or copheim@rocfs.com. © 2011 Commonwealth Financial Network®
