We’ll only be hours into the New Year, and most of us will already be steeling ourselves for the annual guilt trip about abandoned resolutions! It never fails. We start out with the best intentions, but as the world cranks back into gear after the holidays, we find ourselves slipping back into old habits and making old excuses.
Don’t feel too bad. You’re definitely not alone.
The trouble with most New Year resolutions is that keeping them requires consistent effort over the long term. It can be exhausting just thinking about it.
But what if you chose resolutions you could keep by just doing one thing?
To help inspire you, we’ve put together a list of 5 financial resolutions that don’t require a year’s worth of commitment and labor. These are resolutions you can cross off your list early in the year and be done until next December 31st.
Check and Update Your Beneficiaries
Did you experience any life-changing events last year? Did you get married or divorced? Did you add any children or grandchildren to your family? These and other milestones can trigger changes in how you assign beneficiaries for your retirement, life insurance, and other accounts. The start of a new year is a great time to make sure all your beneficiary designations are up to date, and brush up on how to choose beneficiaries wisely.
Get Your Passwords Under Control and Protect Your Identity
We’ve all heard identity theft horror stories. Even a minor incident can expose you to major financial risk and hours of time lost to rectifying the issue. One of the most commonly exploited vulnerabilities is online passwords. All a hacker needs is one chink in the armor, and they can access everything from your bank accounts and social media to credit cards and government documents.
There are many free and low-cost password manager apps that can help you wrangle all your logins while also protecting your identity and your assets. Some of the most popular are LastPass, 1password, and Keeper and Bitwarden. Each of these offers features that make it easy to manage all your passwords in one place more securely and easily than the pile of sticky notes most of us use. As a bonus, many also make it easier to fill out online forms, monitor for suspicious activity around your personal data, and even provide an additional level of security by doubling as a VPN (virtual private network) to ensure your anonymity while browsing on the internet.
Consolidate Your Retirement Accounts
It’s easier to manage your savings when they’re all in one place. Instead of juggling multiple 401(k)s from various jobs, make your life simpler by rolling them all into a single 401(k) or IRA. Pulling everything together makes it easier for you and for your heirs. You won’t have to do so much legwork to keep track of your required minimum distributions (RMDs); and—when you are gone—your heirs won’t have to chase down multiple accounts. You may also be able to save some money in the short term by reducing your administrative and other fees. And, if you choose to roll everything into an IRA, you may have access to different investing options that can save you additional money.
Set Up an Online Social Security Account
It’s never too early to take advantage of the handy tools available at www.ssa.gov/myaccount. You can audit for gaps in your earnings history that could reduce your benefits, get personalized retirement benefit estimates, opt out of mailed notices, and manage many administrative tasks quickly and easily. Claiming your unique online Social Security account also helps protect against thieves trying to set one up in your name to gain access to your benefits.
Inventory Your Belongings for Insurance Purposes
No one wants to contemplate the unthinkable, but it’s better to be prepared for disaster. Creating an inventory list of your personal belongings can help a great deal if you suffer catastrophic property loss. Many insurance companies actually offer apps that make it easy—dare we say almost fun?—to inventory your belongings and store the information safely in the cloud.
Even if your insurer doesn’t offer an app, it’s pretty easy to use your smartphone to video or photograph your belongings. Your videos and images should then be categorized in a way that makes sense to you (by room, type of item, value, etc.) and annotated with key information including descriptions, value, date of purchase or acquisition, etc. It’s also helpful to include digital images of receipts, certificates of authenticity, and other relevant documentation.
Some of these resolutions will take you mere minutes to complete. Others might take a little longer, but they still fall into the “once-and-done” category rather than the “hanging-over-your-head-all-year” category! Check a few of these off your list, and you can start the year off with your head high knowing that you knocked at least a few resolutions out of the park.
Beneficiary Designations: Don’t Wait Any Longer
Include Access to Your On-Line Accounts in Your Estate Plan