Seven Steps to Financial Health:
- Make sure you have a will and Health Care Power of Attorney.
- Have your investments diversified enough so that you can take out emergency funds without penalties? Do not have all your savings in retirement accounts.
- Have different investment buckets: emergency fund, taxable conservatively managed accounts and retirement accounts.
- Check to see that you are not over-insuring yourself. Do, however; make sure you are adequately covered by your medical, life or long-term care insurance. Consider an umbrella insurance policy to cover liabilities.
- Tax preparation should be handled by experts. Don’t try and save by doing it yourself. You may be missing out on deductions or not managing them in your best financial interest.
- Take a good look at your real estate values. How much debt and equity do you have? How high is your interest rate? Would refinancing benefit you?
- Budget your spending in life so that your income exceeds your living expenses.
By following these simple tasks you can help alleviate unhealthy situations that may arise in the future. We can’t always know what is down the road, but if we plan for those just in case situations we may be able to deal with them in a healthy and holistic style.