Move Toward Better Financial Health With a Yearly Fiscal Checkup

No one looks forward to it, but an annual medical checkup is necessary for good health and to catch any potential threats. After all the tests, diagnoses and prescriptions, most people leave the the doctor's office better off than when they entered.

Millions of Americans are due for a fiscal checkup. Rising debt levels, high credit card usage and a lukewarm economy has left families searching for answers around the kitchen table. A 2012 survey from the National Foundation for Credit Counseling revealed that 56 percent of Americans don't have a personal budget. If so many Americans lack this basic financial discipline, it stands to reason that many haven't taken a close look at their financial health in years. It's time for your annual fiscal check-up — and a plan for better financial health.

Medical Doctor Using Stethoscope During Checkup

I'm Going to Check Your Credit Rate

Whether you want to take a out a mortgage or sign up for cable, your credit score is an important component of your financial identity. Annualcreditreport.com provides a free report once every 12 months from each of the three major consumer credit reporting companies (Experian, Equifax and Transunion). Experian explains that most credit scores fall between 600 and 750. Anything above 700 is considered a strong score. These scores will give you an idea of much credit capital you've built, and how you can take steps for better financial health. To boost your score, use credit cards responsibly and pay them off on time.

You Should Quit Spending

It seemed like new and grim personal debt statistics came out every week. The latest returns are more encouraging, however. The rate of late credit card payments fell 19 percent in the first quarter of 2013, according to Cbsnews.com. Still, while millions of Americans are climbing out of debt, millions more are digging the hole deeper. Not all debt is harmful, but without a repayment plan, borrowers will remain cash-strapped.

You don't have to take on debt on your own. Banks and lenders can help you consolidate debt, whether by lowering your interest rate or raising the amount of time you have to repay a loan. Explore all your options and factor debt relief into your monthly budget. Paying down debt is one of the best ways to move toward better financial health.

A Prescription for Security

Even financially stable citizens can benefit from a fiscal checkup. The growing threat of identity theft is causing average Americans to keep closer tabs on their finances. According to a study conducted by Javelin Strategy & Research, 12.6 million Americans were victims of identity theft in 2012, roughly 1 million more than in 2011.

Precautionary measures can reduce your risk of identity theft. Credit monitoring services will alert you to any unusual activity and offer identity theft insurance up to $1 million. Most reputable providers charge $10-$15 per month, a small price to pay for peace of mind and financial security.

The Vitals are Most Important

Financial stability usually comes down to healthy habits. As you review your financial situation, take a step back and consider whether your income supports your lifestyle. If you're not saving, you're probably losing. Make a detailed budget by subjecting all expenses from your monthly income. You'll be surprised how much a visual representation of your money influences your decision making. Join the minority of Americans who track their spending, and you'll have the relief that comes with financial freedom.

6 thoughts on “Move Toward Better Financial Health With a Yearly Fiscal Checkup”

  1. Jen @ The Happy Homeowner

    Great post! I’m a huge fan of the mid-year check-up; I just wrote about my own mid-year review of my goals. It’s amazing how much can change in even half a year–knowing what’s going on is key to be able to keep moving forward.

    1. Miranda Marquit

      It’s good to take stock of where you’re at. And I agree that a lot can change in a relatively short period of time. It’s important to remain flexible and on top of things.

  2. David S. @PBC

    Fiscal checkups are as important as health checkups. Our goal is to attain some form of financial stability. Debt consolidation, reduction in spending and use of credit cards are just some of the major factors we need to consider to maintain our financial health.

  3. Michael | The Student Loan Sherpa

    I’m amazed that over half of people don’t budget. With modern software it has gotten so easy! Lets hope it doesn’t take dire financial circumstances for people to see the light.

  4. Tushar @ Everything Finance

    I do a yearly check up. I would like to do it more often but I forget to make it a priority. This is a good reminder, though.

  5. Nice article. I appreciate mid-year check-up. It is always good to know what is going on and what is your current state. It makes easy to decide what to do next. If you want to be a strong competitor, fiscal check-up is great.
    Thank you Miranda.

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