Plan For Tomorrow | How to prepare your finances for the end of 2021
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How to prepare your finances for the end of 2021

Monday 29 November 2021 | Reading Time: 4 minutes

2022 is just around the corner, which means it's likely a good time to review your finances. From making sure you hit financial deadlines to reviewing your portfolio, there are many items to include on your year-end checklist. Here are a few things you might want to add to your list for review.

Budget for specific goals

Budgeting doesn’t have to be scary. If you have some big purchases in mind for 2022, such as buying a new car or taking a vacation, you should start planning for them as soon as you can. As the old adage goes, “if you fail to plan, you are planning to fail.”

Looking over your finances annually and reflecting on how your expenses compared to the year before can help you establish a baseline for what you might spend in 2022. If anything changed in your life that could affect your finances, be sure to adjust your budget accordingly. Creating a budget for next year’s anticipated expenses can allow you to stay ahead of the game financially.

Organize your financial records

Keeping your financial records organized is essential for your taxes in early 2022, but also important to show proof of legal contracts, insurance claims, residency, and tax returns. Saving and filing your financial documents also makes it easy to locate a record you might need.

Review your finances

With a new year about to start, it may be a good time to take a look at your budget and figure out what your spending habits were in 2021 and what debts you owe, as well as to project how much money you’ll bring in for 2022. You should make adjustments to your budget based on any changes to your finances or life changes.

Review your retirement accounts

Take a look at your retirement plans to understand how they may have changed based on your needs, and decide where you may want to make alterations, such as increasing your contributions or restructuring the plan.

Plan ahead for holiday expenses

It’s the holidays, which means travel, feasting, and gifts. All of which can quickly add up. Start early in preparing for the costs by thinking ahead. If you know you’ll be traveling, make note of how much you’ll need to spend. Get your shopping in order as best you can so you can accurately note the costs of gifts you’ll be giving.

Review your insurance policies

The end of the year is a good time to make sure you have quality life, health, disability, and homeowner's insurance that can protect your family. Review your policies to determine if the coverage you have is sufficient if you need to make changes or possibly find another provider.

Tune-up your emergency fund

If you don’t have an emergency fund, it’s a good idea to think about setting some money aside for a rainy day. Or, if you do have a fund it may be time to review it and especially if you’ve had to use part of your emergency fund over the last year.

Life insurance

It is important to review your life insurance policy periodically to see where it stands. A review will also help you anticipate future changes. This past year could have brought some important changes in your life such as the purchase of a house, a new child, and more. If you have experienced a significant life event, it may mean reviewing your policy is a good idea as you prepare for the end of the year.

Look over your estate plans

Estate planning is an important process to review each year. You may want to review beneficiaries, wills and trusts, power of attorney, and guardianship designations with your attorney or whoever it is that does your estate planning.

Speak with a financial professional

There’s a lot that goes into a financial plan, so you may want some help. A financial professional can help take some of the emotions out of investing and help ensure you have a plan that works for you. To find the right agent who fits your needs, submit your information through our find an agent page.


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