Give your personal finances a makeover -- in one day
You're familiar with the concept of a "mental health day," right? Whether you scoot off to a neighborhood spa or just stick your toes in the kiddie pool while nursing a cold one, the idea is to recharge and reset your mind to what lies ahead. A fiscal health day is very similar (although we don't recommend mixing either footbaths or brewskis).
First of all, it's crucial to do this on a regular, non-holiday weekday, when help desks and call centers are staffed. The Times' writer offers a list of common financial logjams and details of what he did on his self-imposed fiscal health day.
Be prepared to spend a lot of time on hold, the Times warns. If you're one of those people who starts to twitch the instant the Muzak begins, set up in advance some no-attention-required busy work to do while you're in call-center purgatory. Maybe you can go through that pile of magazines that's been accumulating for the past year, or file those zillions of digital photos you never have time to organize.
First in line: earn more interest. If you have a stash of cash parked in a checking account, move it someplace where it's going to work harder for you. Maybe a CD is the answer if you can live without that money for a while (or, look into one of the no-risk CDs if you don't want to lock up your moolah). Another option is an online savings account, which typically pays out higher interest than your average brick-and-mortar equivalent. Be sure to read the fine print to find out a) the minimum balance and b) if a certain number of deposits are required. This way, you won't be socked with those onerous "maintenance fees" that can vacuum up all that interest you're earning.
While you're at it, take a look at what kind of rate you're paying on your credit cards and what kind of perks you're getting (miles, cash back, etc.) for being a customer. How does that compare to what else is out there? If you keep a particular card for the rewards but carry a balance on it, figure out if those airline miles or gas-pump rebates are worth what you're paying in interest every month.
Next up: telecommunications. How much are you paying for your TV service? Internet? Phone? Is that the best you can do? That last question is one you should be asking your current providers -- and their competitors. If you have cable TV, call a satellite provider for a quote, then call your current provider and ask if they'll match it. Currently have satellite service? Do the reverse. Do the same for your Internet connection, landline and mobile phone account or accounts. Many service providers -- especially in this economy -- are willing to offer current customers discounts to keep them, since it costs less to keep an existing customer than to hook a new one. While you've got those bills open, make sure your current plans still work for you: Should you get a texting plan for that teen that runs up your mobile bill every month? Should you scrap the premium kids' channel if they never watch it anymore?
Third: Insurance. Take a look at your home, life, auto and any other policies you have. Do the deductibles and maximums still work for your lifestyle and your family? Do any of your policies need updating? (Did you install a pool? Adopt a pit bull? Take up skydiving? Acquire or inherit pricey jewelry, silver or other items?) After you've updated, your next question should be whether you can get the same coverage from another provider for less.
Since medical insurance is so complex and headache-inducing (how ironic!), we're breaking that out into a separate category. Call your pharmaceutical provider to find out if any pricey drugs can be bought in larger quantities or mail-ordered for a lower cost. Tally up how much you've spent toward annual maximums for ancillary coverage like dental or vision. Think you'll need a tooth capped or a new contact lens prescription? Take care of that now; if you wait until the end of the year, you'll find yourself fighting for appointments with everyone else who waited until the clock ran down to use up their annual maximum. Beat the rush.
If you've already popped an aspirin after dealing with your health insurer, we might as well move along to the next item: taxes. How much are you withholding? Would you be better off with a little more in your paycheck, with the understanding that you'll have to pay more come next April? Do you need to adjust the number of dependents now that Junior's finally taken his futon and moved out? Take a look at your home's assessed value, which determines your property tax rate. Are homes in your neighborhood plummeting in value? Call the assessor's office and plead your case. Do you use a babysitter or a nanny? You might have to pay a "nanny tax" for him or her, and it's better if you figure this out on your own than being informed of your obligation by the IRS.
Outstanding "to dos:" Don't have a will? Get thee to a phone with an estate lawyer's number in hand, stat. Have a 401(k) or related investment from a previous job that's languishing in no-man's land? Find it a new home. Have a tchotcke-of-the-month club or magazine subscription you've been meaning to cancel? Do it.
Finally, here's the cookie for slogging through all of this: Gather up any half-used gift cards you've got lying around and spend the suckers! The store gets to hang onto the cash that went to purchase the gift card for as long as you let it sit in your junk drawer, so dig it out and treat it like what it is: your money.
If this all seems like a long list, it is. Even the Times admits you're probably not going to get through all of it in one shot. But the more you winnow down that stack of tasks, the less insurmountable it'll seem the next time around. And that's the real lesson to take away from your fiscal health day: Do it regularly. Do it now, do it six months from now to finish up the stuff you didn't get to initially, and then check in with your finances once a year.
One final piece of advice: Get the names of every rep you speak with, and if you change anything (your insurance deductible, your cell phone plan), ask for a confirmation number and write everything down.