FIREWORKS AND FINANCES: TIME FOR YOUR MID-YEAR MONEY CHECK-IN
July – a time for barbecues, beach days, and fireworks – lots of fireworks. But while you’re dodging mosquitos and perfecting your potato salad recipe, there’s one more thing that deserves a mid-summer spark: your finances.
Yes, we’re halfway through the year, and it’s the perfect time to ask, “How are my finances really doing?” If the answer is “I have no idea,” don’t worry. You’re not alone – and you’re not too late.
Review Your Goals: Are They Still On Track?
Remember those goals you set back in January? You know, the ones made with hopeful enthusiasm for the new you in the new year? Now is the time to dust them off. If you planned to save $12,000 this year and have only saved $2,000 – you’re a bit behind. But the good news? You’ve got six months to course-correct. Adjust your savings strategy, reassess your goals if needed, and, most importantly, forgive yourself for that spontaneous new TV that you just had to buy because your team made it to the Super Bowl.
Tax Planning: It’s Not Just For Accountants
No one wants to talk taxes in the summer – except your future self, who will thank you for planning ahead. Mid-year is a great time to do the following: Review your withholdings; estimate your potential tax liability; and look at opportunities for tax advantaged savings like IRAs and/or HSAs.
If you had major life changes – got married, had a baby, changed jobs, or started a side hustle – you may want to update your tax strategy now, not scramble in April.
Investment Portfolio: Rebalance Like A Pro Not A Panic-Seller
Markets move, and so does your asset allocation – sometimes without you realizing it. If your original plan called for a 60/40 stock-to-bond ratio and it’s now looking more like 75/25, it’s time to rebalance.
Rebalancing isn’t about timing the market. It’s about maintaining your plan and managing risk. It’s the financial equivalent of getting a haircut before things get too wild.
Bonus tip: Use this time to harvest any losses for tax purposes or to reassess your risk tolerance if the past few months have made you queasy.
Emergency Fund: Your Financial Airbag
If you dipped into your emergency fund this year, it’s time to replenish. If you haven’t started one yet, let this be your nudge. A good rule of thumb? Aim for three to six months’ worth of living expenses. And remember: A true emergency fund is not a vacation fund in disguise.
Final Thoughts: Your Financial Freedom Isn’t On Autopilot
A solid financial plan is like a GPS – it helps you get where you’re going, but only if you check it once in a while. And, as always, working with a CERTIFIED FINANCIAL PLANNER® will only enhance your plan and make it far easier to achieve your goals. July is a great time to make sure you’re still headed in the right direction, not driving in circles with the “Check Engine” light on. So, before you dive back into your summer fun, take a few minutes to check in on your money. Your future self will thank you.
