Financial Calendar: Establish Routines to Manage Your Finances and Meet Your Goals

If you want to improve your finances, meet your savings goals, improve your credit, and monitor your financial health, it is highly recommended to utilize a financial calendar. This is a self-developed tool that you utilize to remind yourself to complete key financial tasks at recurring intervals. It operates the same way as a traditional calendar. Simply make event entries for the actions you need to complete and hold yourself accountable to complete the tasks on time. The frequency at which you complete these tasks may vary based on your goals, risk aversion, and personal circumstances, but the below financial calendar can be altered to meet your needs.

Monthly

• Review bank statements.
• Review credit card statements.
• Evaluate spending in each budget category.

At the end of every month, you will want to review your bank and credit card statements. When doing so, keep an eye out for any transactions you did not authorize. If all the charges are valid, the next step is to ensure each charge is captured in your budget. Once all the charges are accurately tracked and categorized in your budget, you need to evaluate your spending. What categories did you exceed your spending limits? By examining these categories, you can determine whether you need to reduce your spending or potentially reallocate funds from another category. To accurately forecast your budget, you first need to monitor your spending. You can follow these steps to “establish a budget.” An easy way to track expenses and keep your budget on track is to utilize a budgeting application and input transactions at the time of purchase.

Quarterly

• Evaluate saving progress.

In addition to your monthly tasks, you will also want to evaluate your savings quarterly. Whether you are saving for a down payment on a home, a car, a wedding, or home furniture, the best way to do so is to establish a separate high-yield savings account and utilize this account only for that goal. Doing so will prevent the money from being utilized for other purposes. Based on when you expect to make the purchase for which you are saving will determine how much you need to save each month. If, during your quarterly evaluation, you recognize that you are below the savings benchmark that you should have reached, then you need to recalculate the monthly savings required and adjust your contributions in future months to make up for the deficiency.

Semi-Annually

• Pull your credit report.
• Check your credit score.

Pulling your credit report and evaluating your credit score will help you recognize and prevent identity theft, as well as determine what actions you should take to increase your credit score. One of the best tools to check your credit health is the credit report. Lenders will review your credit score and credit report to determine your creditworthiness. You can pull your credit report at no cost from each of the three major credit bureaus (TransUnion, Equifax, and Experian) once per year. If you can only pull the report once per year, then why is this a semi-annual calendar event? While you are entitled to a free credit report each year, this is one free report per credit bureau. Therefore, you could pull one from TransUnion in January, one from Equifax in May, and one from Experian in September. Unless you have cause for concern after pulling the first report, we recommend you space out the other reports to receive multiple snapshots throughout the year, rather than pulling reports from all credit bureaus at the same point. To access your no-cost credit reports go to https://www.annualcreditreport.com/. This is the official source provided by the Federal Trade Commission. Do not be enticed by other free offers to pull your credit report, as you may fall prey to identity theft by providing your information to an illegitimate source. When you pull your credit report, you can check your credit score at the same time. The credit bureaus offer individualized credit scores that will differ slightly based on the factors each one uses in their algorithms when calculating the score. However, the official score is the FICO score. You likely will not be able to obtain the FICO score from the credit bureaus without paying a fee, but your credit card provider may include the FICO score as a free perk. There is no reason to pay for your FICO score semi-annually. The free scores from the credit bureaus are sufficient to informally assess your credit health.

Annually

• Calculate net worth.
• Evaluate insurance coverage annually (life, vehicle, renter’s, home).
• Review and adjust your budget.
• Evaluate and reallocate (if necessary) investments.
• Make end-of-year contributions and donations.

On an annual basis, you should calculate your net worth. Doing so will allow you to gauge your financial health and ensure that your growth in net worth is sufficient based on your long-term goals and projected age of retirement. Check out our “net worth” article to learn how to calculate your net worth.

Additionally, review your annual budget. This task goes hand in hand with the net worth assessment because, if your anticipated growth in net worth falls short of your goals, then you will need to reassess your budget priorities. This may include reducing expenses in several categories to increase your savings and investments or to pay off existing debt.

After calculating your net worth and evaluating your annual budget, take a look at your investment portfolio. Evaluate the performance of each account. What rate of return did you earn? When evaluating return, you need to consider the factors throughout the year that may have impacted return. For example, was inflation high or did the country experience a recession? These items can have short-term impacts on performance, but they do not necessarily mandate a reallocation of investments. If you are content with the level of risk and the quality of your investments, then no adjustments are required.

Finally, before the end of the year, you need to make charitable contributions and pay expenses you plan to include in your tax deductions. This is important for those who choose to itemize their taxes rather than utilize the standard deduction. Additionally, you should take this opportunity to make end-of-year contributions to your retirement accounts. Keep in mind the contribution limits associated with your 401(k) or individual retirement account (IRA).

Conclusion

Rather than letting your financial health and goals be left to fate, establishing a financial calendar will ensure you take the necessary actions to achieve financial independence. Utilize your favorite planner or calendar application. If you use a calendar app, you can add recurring calendar events and never need to copy the events over to the next year. None of the tasks contained in the financial calendar are overly burdensome if you stay up to date and are consistent in completing them. The challenge arises when you procrastinate or skip previous tasks. All of these tasks are important, but you can adjust the frequency of some tasks depending on your situation.