Invest Financial Planning

10 Steps For A Successful Mid-Year Financial Checkup

Pam Krueger  |  July 23, 2020

Checking in on your finances a couple of times per year is always necessary, but it's especially important right now when financial situations are in flux.

It’s been such a tumultuous year so far – with the coronavirus health crisis and subsequent business shutdowns, the stock market’s big drop in March (and then almost immediate rebound), and millions of people are still out of work. If your finances are in a totally different place than they were just a few months ago, you’re not alone. If there’s ever been a need for a mid-year financial check-up, this year is it. Here are some key steps to take to make sure your finances stay on track.

Review your monthly spending.

The COVID-19 safer-at-home orders made it easier for everyone to see where your money goes. You may be spending a lot less on eating out, entertainment and travel, but your regular subscriptions through autopay start to really stand out and add up. Look through your bills for apps, subscriptions, other services you may not use much to find ways to cut back. The costs can sneak up on you – even if you just pay $9 per month for a music service and $15 for a streaming video service, that adds up to $288 per year – and that’s much less than the cost of cable TV or satellite services, which could provide even more opportunities to cut back. And as you start to do more outside of your house, it’s a good time to reassess which expenses are worthwhile. If you lost your job, you might consider getting much more aggressive with cutting back until you have more income coming in.

Assess your debt.

If you have limited money coming in, you can’t afford to spend a lot of it on high interest charges. Itemize all of your debt and the interest rates, including credit card debt, student loans, car loans, mortgage and other debt. If you’re having a hard time paying your bills – especially if you lost your job – talk with your lender before you miss any payments. Look into income-based repayment plans for student loans. If you have some extra money to devote toward debt, on the other hand, prioritize which loans to pay down first. Start with high-interest credit card debt. Also see if you can save by refinancing your car loan or mortgage – but make sure you’re saving enough money that it’s worthwhile to pay the refinancing fees.

Replenish your emergency fund.

The past few months have illustrated how important it is to keep some money in a safe account so you can pay unexpected expenses or cover your bills if your income stops. It’s a good idea to work towards a goal of keeping at least six months’ worth of living expenses in a money-market account or other safe and accessible account so you know the money is right there if you need it, which can help you avoid landing in expensive debt to cover emergency expenses. If you’ve had to tap your emergency fund, make it a goal to start replenishing the account as soon as you can afford to do so.

Save money on insurance.

You may be able to save money on your car and home insurance, especially if your habits have changed because of the pandemic. For example, if you’re working at home or driving less, you could qualify for a low-mileage discount. Or you may be able to save even more money – sometimes as much as 40% – if you sign up for a data-tracking service from your car insurer and maintain low mileage and have safe driving habits. Also ask your auto insurer if you qualify for other discounts, such as a break for certain occupations or if you take a defensive-driving course, or if your high school or college student has good grades. Your home insurer may give you a break for making storm-resistant home improvements. You may also be able to save a significant amount on your auto and home insurance premiums by raising your deductibles – but be sure to keep enough money in your emergency fund to cover the costs in case you do have a claim.

Check your credit record.

It’s great to know your credit score, but actually reading your credit reports will tell you where you may be deficient. You can usually get a free copy of your credit reports from each of the three bureaus (Experian, Equifax and TransUnion) once every 12 months at But because of COVID-19, you can now get a free copy as often as every week through April 2021. Check your report for errors or suspicious activity that could be clues to identity theft. Also look for ways to improve your record – such as paying your bills on time and keeping your balances low – which can help improve your credit score, too. Having a good credit score can help you qualify for lower rates on a mortgage, car loan, credit cards and other debt, and can affect your car and home insurance premiums in many states, as well as your ability to get a cell phone, rent an apartment, or sign up for utilities.

Set short-term and medium-term savings goals.

Do you want to save for a down payment on a house or car, or start saving for a vacation or even holiday gifts? If you plan in advance, it’s much less painful to start setting aside a little money every month, rather than landing in expensive credit-card debt afterwards. Determine how much you’d like to save and the timeframe, and then figure out how much to set aside every month to reach your goal.

Take advantage of every tax-advantaged opportunity to save.

If your employer offers a 401(k) or other retirement-savings plan, you can set aside pre-tax money that grows tax-deferred for the future. Your employer may even match your contributions, which is free money. Whether or not you have a 401(k) at work, you can also contribute to a traditional or a Roth IRA. If your modified adjusted gross income in 2020 is less than $139,000 if single or $206,000 if married filing jointly, you can contribute to a Roth IRA, which isn’t tax-deductible now but you can withdraw the earnings tax-free in retirement (and you can withdraw your contributions without taxes or penalties at any time). And if you have a health insurance policy with a deductible of at least $1,400 for self-only coverage or $2,800 for family coverage, you can contribute to a health savings account, which provides a triple tax break: Your contributions are tax-deductible (or pre-tax if through your employer), the money grows tax-deferred in the account, and you can use it tax-free for eligible medical expenses at any time – there’s no deadline for using the money. Your employer may also contribute to the HSA.

Check your beneficiary designations.

Your beneficiary designations on your retirement plans and life insurance supersede anything you’ve specified in your will. Make sure your beneficiary designations are still up to date so the people you want will inherit your accounts, especially if you’ve gotten married, divorced or had other major life changes.

Make sure your retirement-savings investments match your timeframe and risk tolerance.

After so much volatility in the stock market – and maybe some jitters yourself – it’s a good time to check on your asset allocation of your 401(k), IRA or other retirement-savings plan. Don’t let your emotions lead to investing decisions that could hurt your savings over the long run – such as selling for a loss when stocks go down, then missing the gains when the market rebounds. If you don’t plan to retire for more than 10 years, you can generally afford to keep most of your investments in stock funds, but then gradually shift to more conservative investments as your retirement date gets closer. If you have money in a target-date fund, investment professionals automatically make these moves for you.

Get help when you need it.

Working with a financial advisor can help you take the emotion out of your investing decisions and focus on your long-term goals – which can be especially important when the stock market is volatile and your income may be down. Your advisor can help you stay on track and assess your progress – and let you know about decisions to make if you’re falling short. It’s important to work with a fiduciary advisor who puts your interests first and isn’t just trying to sell you a product. A good financial advisor should be a fiduciary and charge a reasonable, transparent fee. A qualified advisor or planner is there for you to collaborate and help you make smart decisions, and will be accessible when you have questions and adjust your plans as your needs change.


Need a financial advisor but aren’t sure where to start? Fill out this brief questionnaire we created in partnership with Wealthramp. You’ll be matched with a fee-only fiduciary advisor who specializes in your area of need. Don’t worry about unsolicited calls during dinner — it’s up to you to reach out when you’re ready to tackle your “to do” list!

Find your advisor


SUBSCRIBE: Own your money, own your life. Subscribe to HerMoney to get the latest money news and tips!

Editor’s note: We maintain a strict editorial policy and a judgment-free zone for our community, and we also strive to remain transparent in everything we do. Posts may contain references and links to products from our partners. Learn more about how we make money.

Next Article: