While keeping tabs on your personal financial health should never be neglected, the end of the year is the perfect time to review your budget, investment portfolio and any recent financial decisions to ensure you’re on track to meet goals and to determine if adjustments are needed. Such a review needs to be thorough if you’re to spot any weaknesses and build on strengths.
From checking your spending to reviewing your credit report, it’s important to ensure you’ve covered every base when carrying out an annual personal finance review. Below, 14 Forbes Finance Council experts share important financial factors everyone should review at the end of the year.
Members pictured from left to right.
Photos courtesy of the individual members.
1. Analyze Where Your Money Went
Every consumer should check where they spent their money during the year—was there a savings goal, and was it met? Understanding the inflow and outflow of cash will help you to review lessons learned. Not reviewing your cash flow is not being honest with yourself, and you won’t be able to see if you can do better next year—you may be able to save more, and you may see that some of your spending in the last year was unnecessary. – Nike Ajao, Spitfire Strategies
2. See If You Spent More Than You Made
Start by getting real with your finances. One question you can ask yourself is: Did I spend more money than I made this year? If the answer is “yes,” there may be a potential debt problem on hand. Don’t worry though, there are many simple fixes if you start the next year on track! Use a spreadsheet to make sense of your numbers so you can break down and tweak your expenses versus your salary. – Will Murphy, Everlasting Capital
Forbes Finance Council is an invitation-only organization for executives in successful accounting, financial planning and wealth management firms. Do I qualify?
3. Review Your Budget Versus Spending
First, whether it’s for professional or personal reasons, checking your budget spending is crucial to sustainability. It is important to understand if you are overspending or underspending, as that will help you with cash and savings management for the upcoming year. Second, when monitoring one’s debt and savings levels, ask yourself if they are manageable and within reasonable ratios. – Bilal Surahyo, Sleep Country
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