How To Prepare For a Mid-Year Financial Check-Up

Written by Marc Adrian

Reviewing your financial situation for the past six months is an important task that’s often overlooked. What people don’t realize is that doing a mid-year financial check-up can help you achieve your money goals before the end of the year, as well as ensure that you are financially on track so you can avoid any unpleasant surprises. Here are some things that should be on your checklist.

Reorganize your financial goals

It’s time to check whether the goal you set in January to save at least ₱30,000 for emergencies can still be achieved, or you have to change it to something more realistic and achievable. If you are spending more money than expected, you can exert more effort to spend less and save more for the rest of the year. If you’re spending less, you can put more money to your savings and find other profitable ways you can invest all that extra money.

Review your investment portfolio

This is also the perfect time to check on your investments. Check on the mix of investments in your portfolio, and study the effects of the performance of the financial markets on them. They may have changed significantly over the past few months without your knowledge. If so, ask yourself if your current mix is still applicable for the amount of risk that you’re willing to take, your financial and personal circumstances, and your plans for the future. More importantly, check whether the investment returns are still able to meet your financial goals.

Cut down on unnecessary expenses

As you perform an audit of your expenses for the last six months, you will see all the things that you spent your money on that you now wish you didn’t. You’ll find that you spent almost ₱3,000 on a movie streaming site which you didn’t even use because you were too busy with work. You’ll also see that you spent too much money on takeout and clothes since January. If they’re things that you can live without, you can trim down your expenses further by cancelling your subscriptions to services you don’t use a lot or cutting down on shopping when you still have a closet full of good clothes.

Plan for future holiday and vacation spending

If you plan to go overseas or out of town at the end of the year, or if you have a ton of people you want to give Christmas presents to, now is the best time to start planning ahead and save extra money for the holidays. This way, you can have enough money for your Christmas shopping and still keep your Christmas bonus intact. You can also avoid incurring too much credit card debt that usually accompany the holiday season.

Increase your emergency funds

This is also the best time to check whether your emergency fund is adequate. This is to prevent you from touching your savings or charging everything to your credit cards online when something unexpected happens.  Your emergency fund should be enough to cover your regular expenses for a few months, and then some. Make sure that you have enough savings that will keep you and your family afloat and cover both minor and major expenses.