WERE YOU NAUGHTY OR NICE WITH YOUR FINANCES THIS YEAR?
Eleanor Blayney, CFP, Consumer Advocate for Certified Financial Planner Board of Standards, Inc.
Everyone knows how the Christmas Carol goes, “he’s making a list he’s checking it twice…” While you may not be certain with which list you’ll end up on, the Certified Financial Planner Board of Standards has put together the Santa Claus Audit to help you figure it out. After going through this checklist you’ll know if you got a little too naughty with your expenses or kept your finances nice and orderly.
So take a moment to reflect back on the year to think about which category you may fall in. If you dipped into your emergency reserves for a non-emergency expenditure or your outstanding credit card balances have increased, you just may find yourself on Santa’s naughty list. You’ll definitely be on that list if you let another year go by without creating a will or an estate plan. And add a few lumps of coal to your stocking if you’re guilty of:
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Financial infidelity, for instance you have assets, debts, or expenses that you don’t want; your partner to find out about;
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Going without medical insurance; or
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Borrowing from your retirement plan.
Meanwhile, those that will end up on the nice list made financial provisions for uncontrollable events like a natural disaster, job loss or premature death. They probably set aside money from their paycheck to save toward their short-term and long-term financial goals too. Some may find some extra goodies in their stocking if they continued saving for retirement with a qualified retirement plan. Others that made it on the nice list:
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Know their FICO score, net worth, marginal tax rate and asset allocation;
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Reviewed their beneficiary designations on insurance policies and annuities; and
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Talked to their adult children and parents about their own financial circumstances.
Even if you do find yourself on Santa’s naughty list, keep in mind that 2013 is right around the corner. This could be the year you achieve your financial goals and with a little planning, you could insure you end up on Santa’s nice list.