It has been a long winter, and the last thing anyone wants to think about is spring cleaning; however, an annual deep clean of your house is a chance to start fresh, get organized and get back on track.
The same is true for your “financial house.” By taking this time once a year to review your financial well-being and creating clean and organized finances, you may be able to gain confidence while freeing up more time to enjoy the warm spring weather just around the corner.
Use the following S-P-R-I-N-G acronym to get motivated as you review components of your “financial house.”
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
S—Shred old financial documents.
Keep your tax returns, canceled checks, and any records that support tax deductions for auditing purposes. But, it may be time to get rid of those old pay stubs, financial records and documents that you’ve been saving for years. The IRS recommends keeping tax documents anywhere from three to seven years depending on your specific tax situation. Visit www.irs.gov to learn more and determine how long you should retain your tax documents. And remember, it’s important to shred, not throw away old financial documents to help protect your identity.
P—Prioritize your expenses.
Review your savings goals and spending habits. If you have never tracked your spending or set a budget, you may be surprised at how much small purchases add up. Consider using online resources to establish a budget and provide personalized financial reminders. These sites also provide expenditure comparisons, such as the average cost of auto insurance, to help identify additional savings opportunities.
R—Review your estate plan.
Creating an estate plan is a way to efficiently pass on assets to your loved ones and to help avoid the stress and cost of probate after you pass away. If you already have an estate plan, do an annual review to make sure designations are all still current. If a major life event has occurred ,— such as marriage, divorce, birth or death — since the last time you updated your estate documents, take action and meet with a qualified attorney to help you make the necessary revisions.
I—Investigate your insurance coverage.
Now is a great time to review all of your current insurance policies to make sure you’re still paying the best rates and have the appropriate amount of coverage. This review includes home, vehicle, health, long-term care, life insurance and more. If you have had a policy in place for a number of years, there may be enhanced benefits or better rates available in the marketplace than in years past. Consider bundling policies and shopping rates to find the best deal for you.
N—Negotiate your rates.
Every year, make it a priority to look at your outstanding debts and the interest rates you’re paying. Compare rates so that you have a realistic expectation of a possible rate reduction. If your rates are on the high side, contact the loan provider or credit card company and start negotiating a lower rate.
G—Go over your retirement plan.
If you already have a retirement savings account, review the plan and consider contributing the maximum amount possible or, at a minimum, taking advantage of any employer-matching programs available to you. If you do not have a retirement savings account through work or want to contribute even more, consider opening an individual IRA or a Roth IRA as a way to save for retirement.
Remember, your finances should be top-of-mind all year long; but take some extra time this spring to review your progress and get your financial house in order. If you are feeling unsure about your retirement, be sure to consult a qualified financial professional.
Steve Post contributed to this article.
-
6 Stunning Waterfront Homes for Sale Around the USFrom private peninsulas to lakes, bayous and beyond, Kiplinger's "Listed" series brings you another selection of dream homes for sale on the waterfront.
-
Six Reasons to Disinherit Someone and How to Do ItWhether you're navigating a second marriage, dealing with an estranged relative or leaving your assets to charity, there are reasons to disinherit someone. Here's how.
-
Should You Still Wait Until 70 to Claim Social Security?Delaying Social Security until age 70 will increase your benefits. But with shortages ahead, and talk of cuts, is there a case for claiming sooner?
-
Retirement Planning for Couples: How to Plan to Be So Happy TogetherPlanning for retirement as a couple is a team sport that takes open communication, thoughtful planning and a solid financial strategy.
-
Market Turmoil: What History Tells Us About Current VolatilityThis up-and-down uncertainty is nerve-racking, but a look back at previous downturns shows that the markets are resilient. Here's how to ride out the turmoil.
-
Ask the Editor: Taxes, April 11, 2025Ask the Editor In our Ask the Editor series, Joy Taylor, The Kiplinger Tax Letter Editor, answers questions related to IRAs and other retirement accounts.
-
Could You Retire at 59½? Five ConsiderationsWhile some people think they should wait until they're 65 or older to retire, retiring at 59½ could be one of the best decisions for your quality of life.
-
Home Insurance: How to Cut Costs Without Losing CoverageNatural disasters are causing home insurance premiums to soar, but don't risk dropping your coverage completely when there are ways to keep costs down.
-
Markets Roller Coaster: Resist the Urge to Make Big ChangesYou could do more harm than good if you react emotionally to volatility. Instead, consider tax-loss harvesting, Roth conversions and how to plan for next time.
-
Why Homeowners Insurance Has Gotten So Very ExpensiveThe home insurance industry is seeing more frequent and bigger claims because of weather, wildfires and other natural disasters.
