The summer season is starting up and whether you’re excited for your next family vacation or just relaxing at the pool/beach/or lake, midyear is just days away. Now is a great time to slow down and take stock of your entire financial picture and how it’s lining up with your year-end goals. Below are a few ways to check in on your financial health this summer.
Check-In #1: Student Loan Payments to Resume
While we are waiting for the Supreme Court to rule on the legality of the Biden Administration's student loan forgiveness plan, Congress went ahead and recently passed a law preventing further extensions of the federal student loan payment pause. Student loan interest will resume starting on Sept. 1, 2023, and payments will be due starting in October. Here are five steps to make sure you’re prepared for student loan payments to resume:
- Update your contact information in your profile on your loan servicer’s website and in your StudentAid.gov profile.
- Get an estimate of your payment amount and due date through your loan servicer. To do so, log in to your loan servicer’s website or contact your loan servicer directly.
- Review your auto-debit enrollment or sign up for the first time.
- Check out Loan Simulator to find a repayment plan that meets your needs and goals or to decide whether to consolidate.
- Consider applying for an income-driven repayment (IDR) plan. An IDR plan can make your payments more affordable, depending on your income and family size.
Check-In #2: Evaluate Your Current Debt
While it's summer now, the holiday season is going to be here before we know it. Holiday retail sales hit a staggering $943 billion last year, meaning our spending won’t be slowing down anytime soon as we head into the holiday season. In fact, people expect to spend around $867 on Christmas presents alone, and that doesn’t include holiday parties, decorations, travel, etc. With your spending likely to increase toward the end of the year, now is a great time to evaluate any current debt you may have accumulated throughout the year.1,2
You may want to write down all debt currently owed, including credit cards, student loans, mortgages, and car payments. Be sure to also keep track of the minimum payment amounts and due dates. Once you have everything laid out and organized in one place, you can begin focusing on how to minimize or eliminate certain debts. For example, if you’ve been making regular payments to your credit card company, you could try negotiating a lower interest rate or look into transferring the debt to another company. Seeing all your debt in one place may sound stressful, but it’s an important first step in taking control and minimizing what you can.
Check-In #3: Check Your Credit Score
Can you remember the last time you checked your credit score? It’s possible (and likely) that your credit score is really thought about only when it’s time to apply for a new credit card, take out a loan, or make any other large purchases. If you haven’t given it a good look in a while, now’s the time. Your credit scores can give you a decent overview of how your financial health is doing. In addition, they can help make you aware of any potential red flags, such as missed payments, identity theft, or unauthorized use of your credit cards.
Check-In #4: Readjust Your Retirement Fund
If you contribute to an employer-sponsored retirement fund, such as a 401(k) or 403(b), take some time to check in on your account. This is especially important if you set automatic deposits a year or two ago and haven’t thought about it since. For 2023, the 401(k) contribution limit is $22,500 for those under 50 or $30,000 for those 50 and older. If you’re heading toward retirement and trying to make the most of your employer-sponsored plan, you now have the opportunity to save even more in your account.3
Check-In #5: Refill Your Savings
With family vacations, weekend trips, and summer concerts, enjoying the warmer weather can cost quite a bit. The temptation to tap into your savings is strong, and, if you did, you’re not alone. But as we gear up for the holidays, now’s the perfect time to work on filling it right back up. If you set a savings goal for the year, do a quick progress report. Have you nearly reached your goal? Then you may want to challenge yourself to save even more. If you’re nowhere near it, focus on adjusting your spending habits to better support your savings goal.
Check-In #6: Rethink Your Goals
Think back on everything that’s happened this year. It’s likely some unexpected events occurred, isn’t it? From unfortunate events, such as divorce, death, or property damage, to exciting celebrations, such as proposals or births, moments large and small can have a significant impact on your financial standing and goals. Revisit the goals you made at the beginning of the year and make sure they are still well aligned with your current standing. If not, take some time to look at your entire financial picture and future needs, and create new goals that better reflect them.
With a bit of time to prepare, you can enter the second half of the year feeling financially confident and on track to meet your goals. As vacations wind down and school starts back up, find some time to yourself to readjust, reevaluate, and rethink as needed to stay on track for the rest of the year.
This content is developed from sources believed to be providing accurate information, and provided by Wrought Advisors. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.