Do a Mid-Year Financial Checkup

Do a Mid-Year Financial Checkup


It’s shocking that the calendar somehow says June. Wasn’t it just January? You made all those resolutions, likely including some about your finances. Mid-year though, where do you stand?

It’s time for a financial checkup.

What’s changed?

A lot can happen in six months. Has there been a birth, a death, wedding, divorce, job loss, new job, illness? Any such event can call for a course adjustment or correction. Maybe you did a budget at the beginning of the year, but given such life changes it’s no longer realistic.

Review your current expenses and spending and see where you need to tweak your budget. Maybe you’ve gotten promoted and you can put more money toward retirement savings, or pay down debt more aggressively. On the other hand, if you’ve lost your job, you will need to get tough on cutting expenses.

If you’re looking for guidelines, Elle Kaplan, CEO and founding partner of Lexion Capital is a fan of the 50-30-20 plan. “Fifty percent of each paycheck goes to needs like housing, utilities and medical expenses, 30% is spendable income for ‘wants’ and 20% goes to your financial priorities – saving, investing and meeting your financial goals.”

Life changes may also precipitate the need to review your beneficiary designations on your will, trusts, and life insurance policies, for example.

Anticipate year-end

Get a jump on year-end expenses. If you haven’t been saving already, start stashing whatever amount works for you, toward holiday costs like gifts, travel, decorations, and entertaining and festivities that might require additions to your wardrobe. “Setting aside money now can save you from getting derailed later,” says Kaplan.

Take on taxes

Perhaps in the serenity of summer taxes seem less taxing. Now is great opportunity to review your tax withholdings and make any estimated take payments, says Jon Gassman, CPA and CEO of The Gassman Financial Group.

Take a look at last year’s tax return and your most recent pay stub (or, if self-employed or have fluctuating income, look at year-to-date revenues and expenses). Review that in light of this year’s finances, along with the IRS withholding calculator to determine how much you might owe in taxes this year and update your withholdings as needed, suggests Andrew Housser, CEO of Freedom Financial Network.

Make some charitable donations now so you don’t have to bunch them at year-end, says Michael David Schulman of Blue Flamingo Wealth Management.

Wake up

For many it was a long, hard winter, that numbed the brain and now there’s the distraction of summer fun. But there’s plenty to pay attention to. “This winter changed the game for the rest of the year and can seriously impact your portfolio all the way down to your asset allocation strategy if you’re not paying attention,” says Nick Ventura, CEO and president of Ventura Wealth Management.

The market went form a general risk-on trading attitude to a risk-off trading attitude, he says, meaning simpler, more reliable stocks are in vogue. Others, based on the bull phase, sense trouble, since they came down a lot in value and people feel unwilling to commit to long-term risk, he adds.

Consider the higher geopolitical risk. “The atmosphere and tensions in Russia exemplify this point. Geopolitical situations may seem small, but they often pose some type of threats to investments. Russia’s situation alone impacts investments – the country supplies about 40% of natural gas in Europe. When reviewing your asset allocation in your portfolio, make sure you review the current market situations too,” says Ventura.

Are you managing your debt?

You undoubtedly vowed to get out of debt. Measure your progress by confirming that your holiday spending is paid off. “If your credit card debt still exceeds what it did on November 1, 2013, get busy. Set that as your new goal. Stop charging and power pay each card until you are at lest back to your pre-holiday debt level,” says Gail Cunningham, a spokesperson for the National Foundation for Credit Counseling.

Check your credit report. Each of the three major credit reporting agencies offers a single free credit report each year.

Check your credit report. Each of the three major credit reporting agencies offers a single free credit report each year. You can get one at Review it for errors and take action if you find any. Repeat the review at the end of the year.

Assess whether you’re being astute with your credit cards. has list of questions you should ask yourself during a mid-year financial review, including — Does my current card still fit my lifestyle? Are there any loyalty programs that I’m not taking full advantage of? Can my score afford a new card?

“People tend to place far less emphasis on managing their debt than they do on their investment strategy. In doing so, they may be missing an important opportunity to improve their financial lives,” points out John Inhouse, III, a managing director at Merrill Lynch.

Assess savings

Most everyone wanted to save more this year. How are you doing? Make sure that your emergency savings fund is on track. While setting aside three months worth of household income is suggested by some, realistically you should aim for six-nine months, says Gassman.

Check in on your savings goals, such as your children’s education, retirement, family vacation and home improvements. If you’re falling short, see where you can make spending adjustments, or assess whether you want to take on a part-time job, or otherwise find ways to generate more income to bridge the gap.

Invest in yourself

The best asset you have in life is yourself. Your financial success is generally tied to the long-term success of your career. “Consider your current position, compensation, and your long-term upward career mobility. What were your accomplishments during the first half of the year? What value can you add in the second half, should you consider other careers?” asks Anthony Criscuolo, a certified financial planner with Palisades Hudson Financial Group.

While he’s not saying jump ship, think about ways to improve your skills and enhance value to your company. “A more successful career can pay huge financial dividends through higher salary, better job security, and ideally higher job satisfaction.”

Move forward

Maybe you’ll find that you’re right where you hoped to be financially, or maybe you’re not even close. Instead of beating yourself up over goals not set or met, give yourself a do-over says Cunningham.

She says to start now with six goals you can accomplish by year-end. For example, “consider doable goals such as socking away money for holiday spending so that you can have a debt-free Christmas this year or getting financially organized so that you can stop paying bills late and incurring late fees and dinging your credit.”

Says Kevan Melchiorre, a private wealth advisor with Busey Wealth Management, “It’s never too late to right the ship.”


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