Finance concessionaire

Summer is right around the corner and most of us have our to-do-
lists figured out, mentally, if not written down yet. Bible camp for
the kids, plant a large garden, and a trip to the lake. What about
financial housekeeping, shouldn't that be on your list too?

Early summer is a great time to take a financial breather. The
holidays are a long way off, the taxes have just been paid and we're
spending time eating in the backyard instead of dining out.

If you take even one day out of your summer play/work and organize
your finances, you could cut down on the forest of bills, bank
balancing, and paperwork facing you all year long. Now is even a good
time to take a look at your retirement and investment accounts and
check up on your insurance coverage.

Getting Started

Starting with your bank papers, check out how many savings and
checking accounts you have and minimize them. I like to have two
checking accounts for the house, one is used only for the regular
bills and the other is for household items and irregular spending.
Two savings accounts are enough as well, one for long-term saving and
the other for short-term.

Another time and paper saver is if you set up an automatic deposit
of your paycheck into your checking account, and then set up an
automatic payment from your checking account into your savings,
investment, or IRA accounts. Even if you pay yourself only $10 a
week, it adds up over the year and is a good discipline to learn. You
can even use automatic deposits to save money for Christmas presents,
a vacation or other "special occasions".

If you are technologically savy and comfortable with the idea of
electronic payments, consider using e-payments to pay your regular
bills, such as mortgage, electric, or car loan. Don't let the
companies do electronic with-drawls for you. How do you guarantee
that they took the right amount, and if they made a mistake (which
happens) how do you get the money back? It is a lot simpler and
potentially safer for you to do an electronic bill-pay through your
bank.

Another step

In 2001 the Economic Growth and Tax Relief Reconciliation Act made
it easier for you, the investor, to consolidate your retirement
accounts and still retain the tax-favored treatment of the money.
Prior to this act, advisors frequently told their clients to keep
retirement accounts separate to save on taxes.

Now you can take eligible distributions from tax-qualified plans,
403(b) and 457 pension plans and other types of plans like the IRA,
and roll the money into other tax-qualified plans. The purpose here
is to consolidate your multiple plans into one or two accounts.
This'll make it easier for you to keep an abreast of what your money
is doing. With fewer accounts, you'll have less confusion, hopefully
everything is on one statement and if you have questions or need to
make changes you only have to talk to one representative.

Coverage Checkup

Instead of merely simplifying your financial life, you should also
make sure that you are providing adequate protection. It is a good
idea to have insurance on your home, your health, your car, your
loved ones, and your income. Don't forget, though, you can over do it
and have too much insurance. You need to decide what level of self-
insurance you are comfortable with.

The law requires you to carry automobile liability insurance is
required by law. At the least you should have term life insurance to
replace your income and help your loved ones with debt and living
expenses. Homeowner insurance is important in case your home becomes
unlivable due to fire or other incident.

Again, if you can get your insurance through one provider, your
life will be simpler with fewer agents to visit with. Perhaps you can
even have access to your account through the Internet. The less
effort it takes to understand your coverage and to make changes, the
less stress and the more time you'll save.

Final Items

When was the last time you updated your will? If it was more than a
year ago, you might want to do it again. Assets increase or decrease,
potential inheritors are born, and maybe you've decided that you'd
like to leave a little something to your church. Updating your will
is a good way to make sure your final wishes are carried out.
Putting some of your assets in a trust can save on probate costs.
Also if you become incapacitated the trust can manage funds for
people with special needs - a child who needs extra care, for
example. A trust is also another way distribute your assets to
children or grandchildren at a specific age, such as when they reach
age 25 or have children of their own.

Ultimately, you will have to decide just how much consolidation of
planners, agents and financial management you want to do. Once you've
cleaned house on your finances, spending an afternoon in the hammock
will be a lot more restful. Having a peace of mind about your
financial affairs is truly a good feeling.